Align Technology Inc (ALGN)

Days of sales outstanding (DSO)

		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
Receivables turnover		3.69	4.21	4.11	4.19	3.73	4.50	4.28	4.24	4.41	4.39	4.30	3.92	3.73	3.57	4.37	4.26	4.01	4.08	3.87	4.34
DSO	days	98.96	86.69	88.72	87.14	97.75	81.20	85.25	86.10	82.85	83.09	84.90	93.20	97.91	102.23	83.57	85.64	90.98	89.41	94.31	84.16

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 3.69
= 98.96

Days Sales Outstanding (DSO) is a key metric used to assess the average number of days it takes for a company to collect revenue after a sale is made. A lower DSO value indicates that the company is collecting payments more quickly, which is generally favorable. Analyzing the DSO trend for Align Technology, Inc. over the past eight quarters reveals the following insights:

- In Q4 2023, the DSO was 85.38 days, showing an improvement from the previous quarter's 98.57 days. This reduction suggests a more efficient collection of accounts receivable, which could positively impact cash flow.

- The DSO fluctuated over the past two years, ranging from a low of 84.02 days in Q4 2022 to a high of 102.12 days in Q2 2023. These fluctuations may indicate seasonal variations or changes in the company's credit policies and customer payment behavior.

- Despite some variability, the general trend in recent quarters shows a relative stability in DSO levels, hovering around the 90-100 day range. This consistency implies that Align Technology has been effective in managing its accounts receivable turnover and maintaining a steady collection process.

Overall, the trend analysis of Align Technology's DSO highlights the company's efforts in optimizing cash flow by efficiently managing its accounts receivable. Continued monitoring and potential improvements in DSO can contribute to the company's financial health and operational efficiency.