Analysis of Short-term (Operating) Activity Ratios
Quarterly Data
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
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- Statement of Comprehensive Income
- Balance Sheet: Assets
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Reportable Segments
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- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Operating Profit Margin since 2005
- Analysis of Debt
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Short-term Activity Ratios (Summary)
EMC Corp., short-term (operating) activity ratios (quarterly data)
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
The financial ratios presented over the analyzed periods exhibit notable trends in operational efficiency and working capital management. The inventory turnover ratio, after initial figures in the 7.7 range, generally declined to a low of around 6.13 before gradually improving again to approximately 7.66 by the end of the last period. This suggests fluctuations in inventory management efficiency, with periods of slower inventory movement followed by renewed improvement.
Receivables turnover shows significant variability, oscillating between values near 5.54 and a high above 8.49. This indicates fluctuating effectiveness in collecting receivables, with occasional periods demonstrating strong collection performance and other times indicating slower turnover.
Payables turnover similarly varies, with values ranging generally from about 5.42 up to 9.3. Such variation reflects changing payment policies or cash management strategies, possibly balancing supplier relationships and cash outflows.
The working capital turnover ratio displays considerable volatility, starting from higher levels close to 16.58, but then dropping sharply to around 3.35 before climbing back up to roughly 17.35 and eventually settling in the single digits again. These sharp movements imply significant changes in the utilization of working capital, potentially related to shifts in operational scale or asset management effectiveness.
Examining the average inventory processing period reveals a generally increasing trend from approximately 47 days to a peak around 60 days before reducing slightly toward 48 days again. This pattern indicates a lengthening in the time inventory remains before sale in the middle periods, with some recovery in later times.
The average receivable collection period shows considerable fluctuation between roughly 43 and 66 days without a clear sustained trend upwards or downwards. This variability suggests inconsistent credit collection practices or changes in customer payment behavior.
The operating cycle, which sums inventory processing and receivable collection periods, remains mostly stable, fluctuating between about 91 and 117 days. This relative stability amidst the individual variations implies that changes in inventory and receivables periods may partly offset each other.
Average payables payment period ranges broadly from approximately 39 to 67 days, indicating flexibility or shifts in payment terms with suppliers over the periods. This metric reflects changing strategies in cash outflow timing.
The cash conversion cycle generally fluctuates between 44 and 65 days, without a sustained trend but with some periods of improvement and deterioration. This ratio highlights the net time to convert resource outlays back into cash and is influenced by the combined changes in inventory, receivables, and payables periods.
Overall, the data suggests variability in asset and liability management with periods of both improvement and stress. The company appears to adjust operational practices regularly, reflecting responses to market conditions, internal strategies, or external factors affecting cash flow and operational efficiency.
Turnover Ratios
Average No. Days
Inventory Turnover
EMC Corp., inventory turnover calculation (quarterly data)
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Cost of revenues | |||||||||||||||||||||||||||||
| Inventories | |||||||||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Inventory turnover1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Inventory Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Applied Materials Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| Micron Technology Inc. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Qualcomm Inc. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Inventory turnover
= (Cost of revenuesQ2 2016
+ Cost of revenuesQ1 2016
+ Cost of revenuesQ4 2015
+ Cost of revenuesQ3 2015)
÷ Inventories
= ( + + + )
÷ =
2 Click competitor name to see calculations.
- Cost of Revenues
- The cost of revenues demonstrated a generally increasing trend over the observed periods. Starting at 1,909 million USD in March 2011, it fluctuated moderately until 2013, where values were around 2,090 to 2,457 million USD. From 2014 onward, costs consistently rose, peaking at 2,655 million USD in December 2015. However, there was a slight decline in the first half of 2016, with costs recorded at 2,215 and 2,281 million USD respectively.
- Inventories
- Inventories showed an upward movement from 921 million USD in March 2011, reaching a high of 1,421 million USD in March 2014. Following this peak, inventory levels generally stabilized, fluctuating between approximately 1,243 million and 1,390 million USD through mid-2016. Overall, the inventory levels increased by about 30% over the total period considered.
- Inventory Turnover Ratio
- The inventory turnover ratio started at 7.76 in mid-2011 and showed a declining trend through 2013, hitting a low around 6.13 in December 2013. From 2014 onwards, the ratio generally improved, reaching values as high as 7.84 by September 2015. It then stabilized around 7.66 to 7.83 in early to mid-2016. This improvement suggests increased efficiency in managing inventory during the latter periods.
- Summary Insights
- The consistent increase in cost of revenues indicates rising expenses related to product delivery or services over the analyzed timeframe. Meanwhile, inventory levels rose steadily before stabilizing, which alongside a recovering inventory turnover ratio, points to effective inventory management improvements post-2013. The higher turnover ratio in recent periods reflects faster inventory movement relative to inventory levels, which could imply enhanced operational efficiency or better demand forecasting.
Receivables Turnover
EMC Corp., receivables turnover calculation (quarterly data)
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||
| Accounts and notes receivable, less allowance for doubtful accounts | |||||||||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Receivables turnover1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Receivables Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Applied Materials Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| Micron Technology Inc. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Receivables turnover
= (RevenuesQ2 2016
+ RevenuesQ1 2016
+ RevenuesQ4 2015
+ RevenuesQ3 2015)
÷ Accounts and notes receivable, less allowance for doubtful accounts
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The financial data displays quarterly trends over a period extending from March 2011 to June 2016, focusing primarily on revenues, accounts and notes receivable net of doubtful accounts, and receivables turnover ratio.
- Revenues
- Revenues show a general upward trend during the period, with fluctuations across quarters. Starting at 4608 million USD in March 2011, revenues experienced a notable increase reaching a peak of 7049 million USD in December 2014. After peaking, revenues exhibit some volatility but maintain relatively high levels compared to the beginning period, ending at 6017 million USD in June 2016. Periodic dips can be observed, such as in March 2012 and again in early 2015, suggesting potential seasonal or market dynamics affecting sales.
- Accounts and Notes Receivable (net)
- The net accounts and notes receivable also display an increasing trend over the entire period. Beginning at 2379 million USD in March 2011, there is a consistent upward move with some cyclical variations, culminating at 4413 million USD in December 2014. Following this peak, the receivables decrease somewhat but remain elevated compared to the earlier quarters, recording 2896 million USD in June 2016. The rising trend in receivables alongside revenue growth indicates expanding sales on credit but may also imply increased collection risk or extended payment terms during peak periods.
- Receivables Turnover Ratio
- The receivables turnover ratio is available from June 2011 onwards and shows a variable yet generally steady performance. The ratio fluctuates between approximately 5.54 and 8.49, with higher ratios indicating improved efficiency in collections. Notably, the ratio dips to its lowest around March 2015 at 5.54, which corresponds with periods of high receivables balances, implying slower collection cycles at that time. Subsequent quarters show a recovery in the turnover ratio up to 8.49 by June 2016, suggesting enhanced collection efficiency or tightened credit policies.
Overall, the data suggests an expanding business with increasing revenue and receivable volumes, accompanied by fluctuating but mostly stable receivables management efficiency. Peaks in receivables followed by lower turnover ratios highlight periods requiring attention to credit and collection practices to maintain optimal cash flows and reduce credit risk.
Payables Turnover
EMC Corp., payables turnover calculation (quarterly data)
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Cost of revenues | |||||||||||||||||||||||||||||
| Accounts payable | |||||||||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Payables turnover1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Payables Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Qualcomm Inc. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Payables turnover
= (Cost of revenuesQ2 2016
+ Cost of revenuesQ1 2016
+ Cost of revenuesQ4 2015
+ Cost of revenuesQ3 2015)
÷ Accounts payable
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The financial data reveals several key trends in cost of revenues, accounts payable, and payables turnover for the analyzed periods.
- Cost of Revenues
- The cost of revenues exhibits a generally increasing trend over the observed quarters. Beginning at 1,909 million US dollars in March 2011, the cost shows moderate fluctuations but progresses upward, peaking at 2,655 million US dollars in December 2015. There are some temporary declines, such as between December 2013 and March 2014, and between December 2015 and March 2016; however, the overall direction is upward, suggesting growth in operational expenses or expanded production activities over the five-year span.
- Accounts Payable
- Accounts payable also generally increases over time but with notable volatility. Starting at 914 million US dollars in the first quarter of 2011, it frequently fluctuates, with some quarters showing sharp increases—for example, rising from 1,109 million in September 2014 to 1,696 million in December 2014. Such fluctuations may indicate changes in payment terms or supplier relationships. The peak is seen at 1,696 million in December 2014, with subsequent quarters showing decreases and minor rebounds, ending at 1,158 million in June 2016. The variability suggests dynamic management of liabilities or changes in procurement patterns.
- Payables Turnover Ratio
- The payables turnover ratio, measuring how quickly the company pays off its suppliers, demonstrates fluctuating behavior throughout the periods with no clear linear trend. Initial values near 7.12 (starting from June 2011) fluctuate between lows of around 5.42 (March 2015) and highs reaching 9.3 (June 2016). Lower turnover ratios indicate slower payment cycles, while higher ratios signify faster payment. The variability in this ratio suggests intermittent changes in the company’s payment policies or cash management strategies, potentially influenced by seasonal factors or shifts in working capital management.
Overall, the data point to an expanding scale of operations given the rise in cost of revenues, accompanied by fluctuating accounts payable and payables turnover ratio which reflect variable payment practices and supplier financing management throughout the timeframe.
Working Capital Turnover
EMC Corp., working capital turnover calculation (quarterly data)
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Current assets | |||||||||||||||||||||||||||||
| Less: Current liabilities | |||||||||||||||||||||||||||||
| Working capital | |||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Working capital turnover1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Working Capital Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Applied Materials Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| Micron Technology Inc. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Qualcomm Inc. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Working capital turnover
= (RevenuesQ2 2016
+ RevenuesQ1 2016
+ RevenuesQ4 2015
+ RevenuesQ3 2015)
÷ Working capital
= ( + + + )
÷ =
2 Click competitor name to see calculations.
- Working Capital
- The working capital demonstrated significant fluctuations over the analyzed periods. Initially, the working capital showed moderate values around the 500 to 800 million USD mark. A notable decline took place around September 2011, where it turned negative reaching -24 million USD, indicating potential liquidity constraints during this quarter. Subsequently, there was a sharp recovery and consistent growth into early 2012, peaking at over 2400 million USD by March 31, 2012. Following this peak, a general downward trend appeared, with values gradually decreasing towards the end of 2014 and early 2015. The lowest levels in this period were seen between March and September of 2015, with amounts close to or below 1600 million USD. After this trough, working capital rose again significantly through 2016, reaching levels above 3000 and eventually surpassing 5000 million USD by June 30, 2016.
- Revenues
- Revenues generally exhibited an upward trajectory over the period. Starting from approximately 4600 million USD in early 2011, revenues increased steadily with some periodic volatility. There were occasional dips, such as in early 2012 and early 2013, but the overall trend was positive. The highest quarterly revenue amounts were recorded toward the end of the observed span, particularly in late 2014 and throughout 2015, with figures climbing above 7000 million USD during some quarters. The trend indicates solid revenue growth with seasonal or cyclical variations. By mid-2016, revenue hovered around the 6000 million USD level, somewhat below the 2015 peak but generally higher than earlier years.
- Working Capital Turnover Ratio
- The working capital turnover ratio showed marked instability and notable variation across the quarters reported. Data before March 31, 2012, was not available or not reported. Starting from March 2012, the ratio exhibited a wide range of values, from a high of 16.58 to lows near 3.35 and 3.97, indicating varying efficiency in the use of working capital to generate revenues. An increasing trend is observed from mid to late 2014, with ratios climbing from approximately 4.83 to over 17 by late 2015, suggesting improving effectiveness in the utilization of working capital relative to revenue. However, after the peak in late 2015, the ratio decreased appreciably during 2016 to below 5 by mid-year, indicating a reduction in turnover efficiency, possibly due to changes in working capital or revenue dynamics during that period.
- Summary of Interrelations and Trends
- The data reveals a dynamic relationship between working capital levels, revenue generation, and their turnover efficiency. Periods of increasing working capital often align with periods of revenue growth, but not always proportionally, as indicated by the fluctuations in turnover ratio. The peak in working capital in early 2012 alongside a revenue increase suggests strategic liquidity buildup or operational scaling. Conversely, the sharp decline in turnover ratios in 2016 despite increased working capital may point to inventory accumulation, receivables buildup, or slower revenue growth efficiency. Overall, the company appears to experience cyclical shifts in the management and deployment of working capital, with revenue maintaining a generally positive growth trend across the analyzed periods.
Average Inventory Processing Period
EMC Corp., average inventory processing period calculation (quarterly data)
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Inventory turnover | |||||||||||||||||||||||||||||
| Short-term Activity Ratio (no. days) | |||||||||||||||||||||||||||||
| Average inventory processing period1 | |||||||||||||||||||||||||||||
| Benchmarks (no. days) | |||||||||||||||||||||||||||||
| Average Inventory Processing Period, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Applied Materials Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| Micron Technology Inc. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Qualcomm Inc. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly data on inventory turnover ratio and average inventory processing period reveals several notable trends and patterns over the observed periods.
- Inventory Turnover Ratio
- The inventory turnover ratio was first available from March 31, 2011, showing an initial value of 7.76. This ratio experienced a slight decline towards the end of 2011 and the beginning of 2012, reaching a low point of 6.9 by December 31, 2011, and 6.72 by March 31, 2013. Subsequently, the ratio exhibited fluctuations around the mid-6s through 2013 and early 2014, suggesting some volatility in how effectively inventory was being turned over during these periods.
- From mid-2014 onward, there was a general upward trend in the inventory turnover ratio, culminating in a peak of 7.84 around September 30, 2015. This increase indicates an improvement in the efficiency with which inventory was managed. Towards the latest periods, the ratio stabilized around 7.6 to 7.8, indicating consistent inventory turnover performance.
- Average Inventory Processing Period
- The average inventory processing period showed an inverse pattern relative to the inventory turnover ratio, which is consistent with the relationship between these two metrics. Initial values in early 2011 were around 47 days, increasing gradually to a peak of 60 days by December 31, 2012, meaning inventory was held longer during this period.
- Following this peak, the processing period showed a gradual decrease with occasional fluctuations, dropping back to approximately 47 days from March 31, 2015, and remaining relatively stable through June 30, 2016. This reduction corresponds to the periods where the inventory turnover ratio improved, reflecting enhanced inventory management and possibly better sales or supply chain efficiency.
In summary, there was a noticeable initial decline in inventory turnover ratio and a corresponding increase in average processing days around 2011-2012, indicating a less efficient inventory management phase. However, from 2014 onwards, the company demonstrated improvements leading to higher inventory turnover and shorter inventory processing periods, suggesting more effective utilization of inventory and possibly better operational control during these later periods.
Average Receivable Collection Period
EMC Corp., average receivable collection period calculation (quarterly data)
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Receivables turnover | |||||||||||||||||||||||||||||
| Short-term Activity Ratio (no. days) | |||||||||||||||||||||||||||||
| Average receivable collection period1 | |||||||||||||||||||||||||||||
| Benchmarks (no. days) | |||||||||||||||||||||||||||||
| Average Receivable Collection Period, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Applied Materials Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| Micron Technology Inc. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
The data reveals the quarterly trends in receivables turnover and the average receivable collection period from March 2011 through June 2016.
- Receivables Turnover
- This ratio shows some variability over the period but generally fluctuates within a range from approximately 5.54 to 8.49. Starting in March 2012, the turnover ratio increases from 6.81 and peaks in June 2016 at 8.49, indicating enhanced efficiency in collecting receivables over time. Notably, there are several dips below 6.5, such as around March 2014 (6.01) and March 2015 (5.54), which suggest periods of slower turnover. However, the subsequent recovery to higher levels indicates improvement in collection efforts or credit management.
- Average Receivable Collection Period
- This metric, expressed in number of days, tends to inversely mirror the receivables turnover ratio, as expected. The period generally oscillates between roughly 43 days and 66 days. Peaks in the collection period appear at March 2014 (61 days) and March 2015 (66 days), coinciding with troughs in the turnover ratio, reflecting slower collections during those quarters. Conversely, troughs in the collection period, such as 43 days at June 2016, align with higher turnover ratios, indicating more rapid conversion of receivables to cash.
- Overall Trends and Insights
- Over the analyzed timeframe, there is evidence of improved receivables management with a general trend toward higher turnover ratios and shorter collection periods in the later quarters. Seasonal or cyclical fluctuations are observed, possibly linked to operational or market conditions influencing customer payment behavior. The inverse relationship between the two metrics is consistent and confirms the reliability of the data. Periods of increased collection days highlight potential challenges in credit policy or customer payment delays, whereas quarters with high turnover ratios suggest effective collection practices.
Operating Cycle
EMC Corp., operating cycle calculation (quarterly data)
No. days
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Average inventory processing period | |||||||||||||||||||||||||||||
| Average receivable collection period | |||||||||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Operating cycle1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Operating Cycle, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Applied Materials Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| Micron Technology Inc. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= + =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several distinct trends in the company's operational efficiency metrics over the observed periods.
- Average Inventory Processing Period
- The average inventory processing period shows a generally fluctuating trend, beginning at 47 days in the earliest reported quarter and rising to a peak of 60 days by late 2013. Following this peak, there is a moderate decline to around 47-48 days by mid-2016. This indicates that the time inventory remains in stock before being processed increased initially but improved towards more efficient levels over the latter periods.
- Average Receivable Collection Period
- The average receivable collection period displays significant variability without a clearly consistent directional trend. Values range from a low of 43 days to a high of 66 days. Notably, there are intermittent spikes such as the 66 days reported in early 2015, amid generally lower values near the mid-40s throughout the dataset. This suggests inconsistencies in the company's accounts receivable management, impacting cash flow predictability.
- Operating Cycle
- The operating cycle, which combines the inventory and receivables periods, reflects similar fluctuations. It begins near 101 days, peaks around 117 days in late 2013 and early 2015, and subsequently demonstrates a downward trend concluding near 91 days by mid-2016. This overall reduction toward the end of the period observed suggests an improvement in the business's overall working capital management, reducing the total time required to convert raw materials into cash.
In summary, the company experienced some operational inefficiencies, particularly toward the end of 2013, marked by elevated inventory and receivable periods that extended the operating cycle. However, from 2014 onward, the trends indicate efforts leading to more efficient inventory turnover and receivables collection, culminating in a shorter operating cycle by mid-2016. These improvements potentially enhance liquidity and operational performance.
Average Payables Payment Period
EMC Corp., average payables payment period calculation (quarterly data)
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Payables turnover | |||||||||||||||||||||||||||||
| Short-term Activity Ratio (no. days) | |||||||||||||||||||||||||||||
| Average payables payment period1 | |||||||||||||||||||||||||||||
| Benchmarks (no. days) | |||||||||||||||||||||||||||||
| Average Payables Payment Period, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Qualcomm Inc. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
The payables turnover ratio and the average payables payment period demonstrate notable variations over the analyzed quarters. Beginning in March 2011, data is not available for the first four quarters, but from March 2012 onwards, observable trends emerge.
- Payables Turnover Ratio
- The ratio generally fluctuates between approximately 5.4 and 9.3 throughout the periods. There is an initial increase from 7.12 in March 2012 to a peak around 8.99 in September 2012, followed by a slight dip and recovery towards the end of 2012 and early 2013. The ratio decreases to about 6.1 in March 2013, then rebounds periodically, peaking again near 8.61 in September 2015. A notable trough appears at 5.42 in March 2015 and again around 5.91 in December 2015. The highest recorded turnover is 9.3 in June 2016, indicating improved efficiency in payables management at this point.
- Average Payables Payment Period (Days)
- There is an inverse trend relative to the payables turnover ratio, as expected. The payment period decreases from 51 days in March 2012 to a low near 41 days in September 2012, suggesting faster payments during this interval. Subsequently, the period oscillates, reaching highs such as 67 days in March 2015, which indicates slower payment cycles, and lowers sharply to 39 days in June 2016. These fluctuations reflect inconsistent payment scheduling, with some quarters showing significantly longer waiting periods.
The overall pattern indicates periods of both enhanced and reduced efficiency in managing payables. Peaks in payables turnover ratio correspond with shorter payment periods, implying strategic acceleration of payments during certain quarters. However, intermittent dips suggest episodes where payment processing slowed, potentially impacting the company's short-term liquidity and supplier relationships. The data culminates in the second quarter of 2016 with the highest turnover and the shortest payment period, potentially signifying a recent emphasis on optimizing payables management.
Cash Conversion Cycle
EMC Corp., cash conversion cycle calculation (quarterly data)
No. days
| Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Average inventory processing period | |||||||||||||||||||||||||||||
| Average receivable collection period | |||||||||||||||||||||||||||||
| Average payables payment period | |||||||||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Cash conversion cycle1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Cash Conversion Cycle, Competitors2 | |||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | |||||||||||||||||||||||||||||
| Analog Devices Inc. | |||||||||||||||||||||||||||||
| Broadcom Inc. | |||||||||||||||||||||||||||||
| Intel Corp. | |||||||||||||||||||||||||||||
| KLA Corp. | |||||||||||||||||||||||||||||
| Lam Research Corp. | |||||||||||||||||||||||||||||
| NVIDIA Corp. | |||||||||||||||||||||||||||||
| Texas Instruments Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= + – =
2 Click competitor name to see calculations.
- Average inventory processing period
- The average inventory processing period shows an overall upward trend from March 2012 to December 2013, increasing from 47 days to a peak of 60 days. After this peak, the period demonstrates some fluctuations but generally declines to stabilize around 47 to 48 days by mid-2016. This suggests initial increasing inventory holding times, potentially indicating slower inventory turnover, followed by improvements in managing inventory levels.
- Average receivable collection period
- The receivable collection period presents a fluctuating pattern without a clear consistent trend. It starts at 54 days in March 2012, dips to a low of 44 days in mid-2015 and again in mid-2016, and reaches highs near 66 days around March 2015. These variations indicate inconsistent efficiency in receivables collection, with occasional periods of improved collection and other times of lengthened collection duration.
- Average payables payment period
- The payables payment period also shows significant fluctuations, beginning at 51 days in March 2012 and moving downward to lows near 39 days by mid-2016. There is a notable spike around March 2015, reaching 67 days, which is the highest point in the given timeframe. This volatility suggests changing payment policies or cash flow management strategies, with periods of delaying payments counterbalanced by intervals of faster payment.
- Cash conversion cycle
- The cash conversion cycle generally fluctuates between 44 and 65 days, peaking at 65 days in March 2013. The metric shows no consistent downward or upward trend but instead oscillates within a moderate range over the examined period. The variability is influenced by the combined effects of inventory processing, receivables collection, and payables payment periods, implying variable working capital efficiency over time.