Bristol-Myers Squibb Company (BMY)

Cash conversion cycle

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	29.47	40.37	37.99	37.43	34.53	31.35	30.38	33.68	30.02	25.53	26.48	25.99	25.33	32.25	38.73	45.24	64.30	62.65	81.76	104.39
Days of sales outstanding (DSO)	days	81.21	84.84	89.65	83.74	88.57	83.70	81.68	80.04	78.17	75.07	70.10	66.15	73.72	74.22	74.15	73.84	72.98	74.70	82.24	97.59
Number of days of payables	days	41.51	42.03	46.32	44.37	42.27	36.20	39.44	41.29	39.01	31.95	35.63	36.36	35.66	40.18	65.41	68.84	84.11	78.46	97.81	112.97
Cash conversion cycle	days	69.17	83.18	81.32	76.80	80.83	78.85	72.62	72.43	69.18	68.66	60.95	55.78	63.40	66.28	47.47	50.23	53.17	58.88	66.19	89.01

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 29.47 + 81.21 – 41.51
= 69.17

The cash conversion cycle of Bristol-Myers Squibb Company has exhibited fluctuations over the observed periods. The company's cash conversion cycle, a key indicator of efficiency in managing working capital, decreased from 89.01 days as of March 31, 2020, to a low of 47.47 days on June 30, 2021, signaling an improvement in converting its investments in inventory and accounts receivable into cash within a shorter period.

However, the trend reversed in the subsequent quarters, with the cash conversion cycle increasing to 83.18 days as of September 30, 2024. This rise indicates that Bristol-Myers Squibb Company took longer to convert its resources invested in inventory and accounts receivable into cash during that period, signaling a potential liquidity challenge or inefficiency in working capital management.

It is essential for the company to closely monitor its cash conversion cycle to ensure optimal utilization of its working capital and efficiency in cash flow management. Further analysis and potential strategic adjustments may be necessary to address any prolonged cash conversion cycles to enhance the company's financial performance and liquidity position.