ADEIA CORP (ADEA)

Cash conversion cycle

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Days of inventory on hand (DOH)	days	—	—	—	2.95	7.40
Days of sales outstanding (DSO)	days	134.14	107.56	109.96	206.53	175.74
Number of days of payables	days	15.63	17.71	5.24	0.26	9.83
Cash conversion cycle	days	118.51	89.85	104.72	209.22	173.31

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 134.14 – 15.63
= 118.51

ADEIA CORP's cash conversion cycle has shown fluctuations over the past years. In 2020, the cycle was 173.31 days, indicating the number of days it takes for the company to convert its investments in inventory and other resources into cash flows from sales. The cycle increased to 209.22 days by the end of 2021, suggesting a potential delay in converting resources to cash.

However, by the end of 2022, there was a significant improvement in the cash conversion cycle, decreasing to 104.72 days. This reduction implies ADEIA CORP was able to streamline its operations and manage its working capital more efficiently.

In 2023, the cycle decreased further to 89.85 days, showcasing a continued improvement in the company's ability to convert its resources into cash more quickly. Despite a slight increase to 118.51 days by the end of 2024, the cycle remains relatively efficient compared to previous years, indicating ADEIA CORP's continued efforts in optimizing its cash conversion processes.

Overall, ADEIA CORP has demonstrated progress in managing its cash conversion cycle over the years, with a trend towards more efficient working capital management leading to quicker cash conversions.