Intel Corp. (NASDAQ:INTC)

The analysis of the liquidity ratios over the periods presented reveals notable trends and shifts in the company's short-term financial health.

Current Ratio

The current ratio demonstrates an overall declining trend from early 2020 through 2025. Initially, there is some fluctuation with values peaking around 2.13 in early 2022. However, from that point onwards, a gradual decrease is observed, reducing to approximately 1.31 by the first quarter of 2025. This suggests a weakening in the company's ability to cover current liabilities with current assets over time.

Quick Ratio

The quick ratio, reflecting liquid assets excluding inventories, follows a similar downward trajectory. The ratio experiences some volatility but generally declines from a high of 1.56 in early 2022 to a low near 0.72 in the middle of 2024, with a slight recovery to 0.75 by early 2025. This indicates a reduced buffer of liquid assets available to pay immediate liabilities, representing a potential increase in liquidity risk.

Cash Ratio

The cash ratio exhibits a parallel pattern, with values peaking at 1.32 in early 2022 before decreasing steadily to levels around 0.62 to 0.65 by early 2025. The decline suggests diminishing cash and cash equivalents relative to current liabilities, which may impact the company's ability to satisfy short-term obligations without relying on the conversion of other current assets.

Collectively, the liquidity ratios portray a period of relative strength up to early 2022, followed by a consistent decrease through 2025. This trend implies increasing caution regarding liquidity management and may warrant further investigation into the underlying causes, such as changes in working capital management, asset composition, or shifts in current liabilities.

The analysis of the quarterly financial data reveals specific trends in the company's liquidity and working capital management over the observed periods.

Current Assets

The current assets exhibit fluctuations across the quarters. Starting at 41,501 million US dollars in March 2020, the value increased to a peak of 61,304 million in September 2021. Subsequently, a decline occurred, with values dropping to around 43,000 to 48,000 million range in 2023 and early 2024. The latest quarters show some volatility, ending at 42,134 million in March 2025, indicating a general downward trend from the peak experienced in late 2021.

Current Liabilities

Current liabilities follow a gradual upward trajectory throughout the period. From 23,895 million US dollars in March 2020, liabilities consistently increased with some seasonal fluctuations, reaching a high of 35,666 million in December 2024. This steady increase suggests a rising short-term obligation level, which may impact liquidity if not matched by assets.

Current Ratio

The current ratio demonstrates an overall decreasing trend in the firm's liquidity position. Initially, it stood at 1.74 in March 2020 and rose to a peak of 2.13 in April 2022, reflecting a strong liquidity position at that time. However, post-2022, the ratio declines steadily, reaching lows around 1.31 by December 2024 and March 2025. This decline, despite minor fluctuations, indicates a tightening liquidity situation, with current liabilities increasing at a faster rate than current assets in recent quarters.

In summary, the company experienced strong liquidity and asset growth up to late 2021 and early 2022, followed by a decline in current assets alongside increasing current liabilities. The progressive reduction in the current ratio suggests the firm’s short-term financial flexibility has diminished over the last few years. This trend warrants monitoring to ensure sufficient liquidity is maintained to meet short-term obligations efficiently.

Total Quick Assets

The total quick assets displayed fluctuations throughout the observed periods. Starting at 29,258 million USD in March 2020, the value increased to a peak of 43,035 million USD by September 2021. Following this peak, a generally decreasing trend emerged with some intermittent rises, notably in December 2022 (32,471 million USD) and June 2024 (32,404 million USD). However, overall, the asset base declined towards 24,112 million USD by March 2025, indicating a reduction in highly liquid assets over time.

Current Liabilities

Current liabilities showed a generally increasing trend over the period under review. Beginning at 23,895 million USD in March 2020, liabilities rose with some variability and reached consistently higher levels by the end of the series. Notable increments occurred from 32,155 million USD in December 2022 to a peak of 35,666 million USD in December 2024, before a slight decline to 32,174 million USD in March 2025. This upward trend suggests growing short-term obligations.

Quick Ratio

The quick ratio fluctuated within the range of 0.72 to 1.56 throughout the periods. Early values ranged between 1.15 and 1.48, indicating relatively strong liquidity positions. A peak quick ratio of 1.56 was observed in April 2022, signaling a high level of liquid assets relative to current liabilities at that time. However, subsequent quarters revealed a downward trajectory, with the quick ratio falling below 1.0 from July 2023 onwards and reaching a low of 0.72 in December 2024. The ratio slightly improved to 0.75 in March 2025 but remained below the threshold of 1, suggesting tighter short-term liquidity and potentially increased liquidity risk towards the later part of the timeline.

Overall Observations

The data indicate a period of asset growth in the first half of the timeline, followed by a contraction in quick assets in the latter periods. Concurrently, current liabilities trended upward, increasing the pressure on liquidity. This dynamic is reflected in the quick ratio trend, with strong liquidity initially deteriorating into suboptimal levels in recent quarters. The decreasing quick ratio, along with reduced quick assets and increasing liabilities, may point to a weakening short-term financial position and heightened liquidity risk that merits close monitoring.

The analysis of the quarterly financial data reveals several notable trends and patterns related to the company's liquidity position over the observed periods.

Total Cash Assets

The total cash assets exhibit a fluctuating pattern with an overall tendency to decline slightly towards the end of the period. Starting from approximately $20.8 billion in March 2020, cash assets experienced increases and decreases throughout subsequent quarters, reaching peaks such as $34.6 billion in September 2021 and $38.7 billion in April 2022. However, from early 2023 onwards, the values generally trend downward, culminating in about $21 billion by March 2025. These fluctuations suggest varying cash management and operational activities influencing liquidity.

Current Liabilities

Current liabilities display an upward trajectory from about $23.9 billion in March 2020 to a peak exceeding $35.6 billion in December 2024. There are consistent increases quarter over quarter, with only minor temporary declines, indicating rising short-term obligations. The increasing current liabilities could be reflective of growth in operational scale, accruals, or other short-term financial commitments.

Cash Ratio

The cash ratio, defined as cash and cash equivalents divided by current liabilities, has shown a gradual decline over time. Starting at 0.87 in early 2020, it experienced some fluctuations, with values occasionally exceeding 1, such as the 1.17 recorded in September 2021 and 1.32 in April 2022. Post this period, the ratio trends downward, reaching lows of 0.62 to 0.65 in late 2024 and early 2025. This decline indicates a reduction in the company's immediate liquidity relative to its short-term liabilities, which could signal increasing pressure on liquid assets to cover current obligations.

In summary, while the company maintained strong cash reserves through parts of the observed timeline, particularly around 2021 and early 2022, there is a discernible decrease in liquid assets relative to current liabilities in the more recent periods. The rising current liabilities combined with a declining cash ratio highlight potential liquidity constraints that may warrant closer monitoring and strategic financial management moving forward.