Advanced Micro Devices Inc (AMD)

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		3.54	4.39	5.09	—	4.53	5.24	5.31	5.12	5.41	6.64	6.56	5.20	4.43	4.01	4.18	3.75	3.23	3.74	3.36	3.67
DSO	days	103.18	83.15	71.70	—	80.65	69.59	68.69	71.28	67.49	54.96	55.66	70.17	82.39	91.04	87.33	97.37	112.97	97.72	108.75	99.53

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 3.54
= 103.18

Days of Sales Outstanding (DSO) is a key financial metric that indicates the average number of days it takes for a company to collect its accounts receivable. A lower DSO value is generally preferred as it signifies that the company is able to collect its receivables more quickly.

Analyzing the DSO trend of Advanced Micro Devices Inc over the past few quarters, we can observe fluctuations in the collection efficiency of the company.

- In the most recent quarter ending December 31, 2023, the DSO stood at 103.18 days, which represents a significant increase compared to the previous quarter where the DSO was 83.15 days. This uptick in DSO could indicate potential challenges in collecting receivables promptly, which may impact the company's cash flow and liquidity position.

- Looking back further, we see a mixed trend in DSO values with fluctuations in collection efficiency. The company experienced a high DSO of 112.97 days in the fourth quarter of 2019, which improved to 54.96 days in the third quarter of 2021, reflecting a positive trend.

- However, there was a subsequent increase in DSO to 99.53 days in the first quarter of 2022, indicating a slowdown in receivables collection efficiency.

Overall, careful monitoring of DSO is crucial for Advanced Micro Devices Inc to ensure timely collections and maintain a healthy cash flow position. Any persistent increase in DSO could raise concerns about the company's credit policies, customer payment behavior, or potential liquidity challenges.