Booking Holdings Inc (BKNG)

Cash conversion cycle

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Days of inventory on hand (DOH)	days	—	17.69	20.57	19.30	—
Days of sales outstanding (DSO)	days	52.33	45.13	43.60	20.19	30.55
Number of days of payables	days	104.75	92.97	80.75	42.10	128.70
Cash conversion cycle	days	-52.42	-30.15	-16.58	-2.60	-98.15

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 52.33 – 104.75
= -52.42

The cash conversion cycle for Booking Holdings Inc has exhibited fluctuations over the past five years. In 2023, the cash conversion cycle increased to 55.57 days from 47.61 days in 2022, indicating that the company took longer to convert its investments in inventory and receivables into cash during the latest period. This suggests a potential inefficiency in managing working capital compared to the previous year.

Looking back, the trend shows an improving cash conversion cycle in 2021 compared to 2020, with a decrease from 45.23 days to 28.41 days, indicating a more efficient management of the company's short-term assets and liabilities in converting them into cash. However, in 2019, the cash conversion cycle increased to 40.70 days, signifying a slightly less efficient working capital management compared to 2021.

Overall, Booking Holdings Inc's cash conversion cycle has experienced fluctuations, with improvements seen in some years and deteriorations in others. Monitoring and analyzing this metric can provide insights into the company's efficiency in managing its working capital and cash flow conversion processes.