A10 Network (ATEN)

Cash conversion cycle

		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
Days of inventory on hand (DOH)	days	52.41	52.17	44.96	44.58	42.57	45.63	47.12	45.23	50.12	44.50	45.61	47.75	49.48	71.18	69.69	62.17	64.51	44.38	44.89	40.07
Days of sales outstanding (DSO)	days	107.76	82.19	91.72	88.31	94.92	98.10	93.06	69.89	90.21	70.56	78.58	82.87	82.62	70.00	76.36	72.42	92.05	77.46	74.54	70.15
Number of days of payables	days	15.65	18.19	14.08	12.91	14.54	12.96	11.96	10.84	15.29	8.72	13.53	11.04	11.58	22.96	21.54	11.79	21.88	11.55	15.45	15.56
Cash conversion cycle	days	144.51	116.17	122.60	119.98	122.95	130.77	128.21	104.28	125.04	106.33	110.65	119.58	120.52	118.22	124.51	122.80	134.68	110.29	103.99	94.66

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 52.41 + 107.76 – 15.65
= 144.51

A10 Networks Inc's cash conversion cycle has varied over the past eight quarters. In Q4 2023, the company's cash conversion cycle reached 233.31 days, representing the number of days it takes to convert its investments in inventory and other resources into cash collected from customers. This extended duration indicates that A10 Networks Inc may be facing challenges in efficiently managing its liquidity and working capital.

Comparing the latest quarter to the prior periods, there has been a fluctuation in the cash conversion cycle. While Q3 2023 showed an improvement at 194.35 days, Q2 2023 increased to 186.98 days, then slightly rose in Q1 2023 to 186.35 days. The trend has been somewhat volatile, suggesting potential inconsistencies in the company's operational efficiency in converting sales back into cash.

Furthermore, when looking at the year-on-year trend, the cash conversion cycle in Q4 2023 was higher than the same quarter in 2022, which stood at 178.24 days. This indicates a deterioration in A10 Networks Inc's ability to efficiently manage its working capital over the one-year period.

Overall, the company's cash conversion cycle analysis highlights the importance of monitoring and improving operational effectiveness and working capital management to enhance its overall financial health and performance.