Allegro Microsystems Inc (ALGM)

Days of sales outstanding (DSO)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 23, 2022	Sep 23, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021
Receivables turnover		8.80	10.53	14.73	8.81	9.36	8.98	8.48	6.86	7.07	7.08	6.58	6.70	7.00	7.26	6.44
DSO	days	41.47	34.65	24.78	41.45	38.98	40.65	43.03	53.20	51.65	51.53	55.51	54.47	52.13	50.26	56.71

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 8.80
= 41.47

Allegro Microsystems Inc's Days Sales Outstanding (DSO) is a key metric used to assess the efficiency of the company's accounts receivable management. DSO represents the average number of days it takes for the company to collect payment from its customers after making a sale.

Based on the provided data, we observed fluctuations in Allegro Microsystems Inc's DSO over the analyzed periods. The trend shows a general decrease in DSO from June 30, 2021, to December 31, 2023, indicating an improvement in the collection efficiency of the company. However, it is important to note that DSO increased slightly on March 31, 2024, and then significantly decreased on June 30, 2024.

The lowest DSO recorded was on June 30, 2024, at 24.78 days, suggesting that the company was able to collect payments from its customers at a faster rate during that period. Conversely, the highest DSO was on June 30, 2023, at 56.71 days, signifying a longer collection period compared to other periods.

The decreasing trend in DSO reflects positively on Allegro Microsystems Inc's ability to manage its accounts receivable efficiently and indicates a potential improvement in cash flow generation. However, it is essential for the company to continue monitoring and managing its DSO to ensure timely collections and optimize its working capital management.