Apple Inc (AAPL)
Days of sales outstanding (DSO)
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 6.22 | 6.42 | 7.05 | 7.25 | 5.60 | |
| DSO | days | 58.68 | 56.82 | 51.77 | 50.31 | 65.15 |
September 30, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.22
= 58.68
Days of Sales Outstanding (DSO) is a crucial financial metric that measures the average number of days it takes for a company to collect payment after making a sale. Analyzing Apple Inc's DSO over the past five years reveals some interesting insights.
From 2019 to 2023, Apple's DSO has exhibited some fluctuations. The DSO increased from 64.26 days in 2019 to 58.08 days in 2023, with intermittent changes over the intervening years. Generally, a decrease in DSO indicates that the company is collecting receivables more efficiently, while an increase suggests a lengthening of the collection period.
The upward trend observed in Apple's DSO from 2019 to 2023 may raise concerns about the company's ability to efficiently convert sales into cash. This trend could be influenced by various factors, such as changes in the company's credit policies, the nature of its customer base, or potential operational inefficiencies within the collection process.
A high DSO may imply a longer cash conversion cycle, meaning the company has to wait longer to receive payment for its products, which can tie up working capital. On the other hand, a consistently low DSO indicates that the company is effectively managing its accounts receivable, and is able to convert sales into cash more quickly.
Overall, the analysis of Apple Inc's DSO suggests a need for further investigation into the underlying reasons for the fluctuations and trends observed, as it could have implications for the company's liquidity and working capital management.
Peer comparison
Sep 30, 2023