AbbVie Inc (ABBV)

Cash conversion cycle

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	40.60	41.14	42.83	38.51	36.61	32.31	36.34	39.22	35.19	34.42	36.97	36.88	44.07	51.26	88.92	68.38	88.96	94.44	93.85	83.00
Days of sales outstanding (DSO)	days	74.96	75.54	74.87	73.80	70.76	67.82	71.52	69.06	64.80	61.40	67.35	69.72	70.30	75.57	84.17	68.18	59.56	61.40	61.33	63.50
Number of days of payables	days	36.53	—	—	—	30.01	—	—	—	32.42	—	—	—	30.30	—	—	—	71.24	—	—	—
Cash conversion cycle	days	79.03	116.69	117.70	112.31	77.35	100.13	107.86	108.28	67.57	95.83	104.32	106.60	84.07	126.83	173.09	136.56	77.27	155.85	155.18	146.50

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 40.60 + 74.96 – 36.53
= 79.03

The cash conversion cycle of Abbvie Inc has fluctuated over the past eight quarters. In Q2 2023, the company experienced its longest cash conversion cycle of 159.84 days, indicating a slower turnaround time from purchasing inventory to receiving cash from sales. This was preceded by a significant improvement in Q4 2023, with a cycle of 82.31 days, suggesting more efficient management of cash flow.

Overall, the trend shows some variability in the cash conversion cycle, with periods of longer and shorter cycles. It is important for Abbvie Inc to closely monitor and manage this cycle to optimize working capital efficiency and ensure smooth operations.