Cadence Design Systems Inc (CDNS)

Days of inventory on hand (DOH)

		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
Inventory turnover		1.52	1.50	2.89	2.40	2.42	2.59	2.88	3.12	2.90	3.04	3.17	2.91	2.65	3.06	3.50	4.11	4.02	6.36	6.47	4.46
DOH	days	239.51	243.84	126.41	152.00	150.69	140.78	126.59	116.91	125.72	119.93	115.28	125.37	137.60	119.28	104.34	88.75	90.75	57.36	56.46	81.82

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 1.52
= 239.51

Cadence Design Systems Inc's days of inventory on hand (DOH) has shown fluctuations over the period from March 31, 2020, to December 31, 2024. The DOH measures the number of days a company holds its average inventory before selling it.

The trend in Cadence's DOH indicates some variability in managing its inventory levels efficiently. The company started with 81.82 days on hand in March 2020 and reduced it to 56.46 days by June 2020, showing an improvement in inventory turnover efficiency. However, the DOH increased to 90.75 days by December 2020, suggesting a delay in converting inventory into sales.

Throughout 2021 and 2022, the DOH remained elevated, ranging from 104.34 days to 125.72 days. This prolonged period suggests potential issues related to inventory management or a slower rate of inventory turnover.

In the subsequent periods, from March 2023 to December 2024, there were significant spikes in the DOH, reaching a high of 243.84 days in September 2024. Such high levels could indicate excess inventory or challenges in selling products efficiently.

Overall, the analysis of Cadence Design Systems Inc's DOH reveals fluctuations and potential inefficiencies in managing inventory levels, which can impact the company's working capital and overall profitability. Further investigation into the reasons behind these fluctuations would be necessary to address any underlying issues and improve operational effectiveness.