Applied Materials Inc (AMAT)

Days of sales outstanding (DSO)

		Jan 28, 2024	Oct 29, 2023	Jul 30, 2023	Apr 30, 2023	Jan 29, 2023	Oct 30, 2022	Jul 31, 2022	May 1, 2022	Jan 30, 2022	Oct 31, 2021	Aug 1, 2021	May 2, 2021	Jan 31, 2021	Oct 25, 2020	Jul 26, 2020	Apr 26, 2020	Jan 26, 2020	Oct 27, 2019	Jul 28, 2019	Apr 28, 2019
Receivables turnover		5.25	4.71	4.66	4.45	4.45	3.92	4.50	—	5.00	4.13	—	—	5.67	5.50	5.49	5.61	5.37	5.56	5.95	6.53
DSO	days	69.52	77.48	78.33	81.98	82.00	93.13	81.08	—	73.06	88.47	—	—	64.41	66.31	66.52	65.01	67.96	65.69	61.32	55.88

January 28, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 5.25
= 69.52

To analyze Applied Materials Inc.'s days of sales outstanding (DSO) based on the provided data, it is evident that there has been a fluctuation in DSO over the past eight quarters. DSO measures the average number of days a company takes to collect payment after a sale has been made.

From Q1 2022 to Q4 2022, the DSO decreased from 85.90 days to 71.90 days, indicating an improvement in the company's collection efficiency. However, in Q1 2023, there was a slight increase to 74.87 days, followed by a further increase in Q2 2023 to 75.58 days, suggesting a potential delay in receivables collection.

The company showed a slight improvement in Q3 2023 with a DSO of 71.92 days, but it increased again in Q4 2023 to 71.09 days. Notably, in Q1 2024, there was a significant decrease in DSO to 64.77 days, which may suggest a more efficient collection process or possibly better credit policies.

Overall, Applied Materials Inc. should continue to monitor its DSO closely to ensure timely collection of accounts receivable, which can impact its liquidity and overall financial health.