Apple Inc (AAPL)

Cash conversion cycle

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019
Days of inventory on hand (DOH)	days	11.25	9.61	9.76	10.02	9.67	11.07	11.19	10.12	7.26	8.13	8.22	9.00	10.22	8.36	8.81	9.06	7.82	7.69	6.58	8.09
Days of sales outstanding (DSO)	days	61.83	40.97	39.56	47.66	58.53	37.53	—	51.46	56.82	40.07	43.23	63.41	51.77	35.85	37.29	73.26	50.20	43.10	42.16	55.02
Number of days of payables	days	106.45	74.18	71.66	89.49	95.59	70.34	64.22	85.96	94.12	72.33	79.31	113.87	85.07	65.23	67.70	116.28	81.48	68.28	63.96	89.12
Cash conversion cycle	days	-33.37	-23.59	-22.34	-31.81	-27.39	-21.73	-53.03	-24.38	-30.04	-24.13	-27.86	-41.46	-23.09	-21.02	-21.61	-33.95	-23.46	-17.49	-15.22	-26.01

September 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 11.25 + 61.83 – 106.45
= -33.37

The cash conversion cycle of Apple Inc has been fluctuating over the past years, as shown by the data. The cash conversion cycle represents the time it takes for a company to convert its resources invested in inventory into cash flows from sales.

Analyzing the trend, we can observe that Apple Inc has experienced both positive and negative cash conversion cycles. A negative cash conversion cycle, which is the case for Apple, indicates that the company is efficient in managing its working capital and generating cash flows from operations.

Looking at the latest data as of September 30, 2024, the cash conversion cycle is -33.37 days, suggesting that Apple is efficiently managing its inventory, accounts receivable, and accounts payable to generate cash quickly. This improvement in efficiency can be attributed to Apple's strong sales and inventory management practices.

Overall, with a consistently negative cash conversion cycle, Apple Inc is effectively managing its working capital and cash flows, which is a positive indicator of the company's financial health and operational efficiency.