Cadence Design Systems Inc (CDNS)

Activity ratios

Short-term

Turnover ratios

	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
Receivables turnover	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Payables turnover	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Working capital turnover	1.75	1.80	6.28	8.78	10.61	7.00	8.51	7.12	9.92	8.31	5.34	4.07	4.01	4.68	5.45	5.03	3.94	4.08	4.99	6.14

Cadence Design Systems Inc's inventory turnover ratio has shown fluctuations over the reporting periods, ranging from a high of 6.47 in June 2020 to a low of 1.50 in September 2024. The downward trend in recent periods may indicate potential issues with managing and selling inventory efficiently.

The receivables turnover ratio data is not available, suggesting that the company may not have disclosed information relating to the efficiency of its accounts receivable collection process. This lack of transparency can make it difficult to assess the effectiveness of the company's credit policies and collection procedures.

Similarly, information regarding the payables turnover ratio is also unavailable, making it challenging to evaluate how effectively Cadence Design Systems manages its trade payables and vendor relationships.

The working capital turnover ratio has displayed significant variability, with values ranging from 1.75 in December 2024 to a high of 10.61 in December 2023. This indicates fluctuations in how efficiently the company is using its working capital to generate sales revenue. The sharp decline in the ratio towards the end of the period may raise concerns about the company's ability to utilize its working capital effectively.

In conclusion, while the inventory turnover and working capital turnover ratios provide some insights into Cadence Design Systems Inc's operational efficiency, the lack of data on receivables and payables turnover ratios limits a comprehensive analysis of the company's overall working capital management and liquidity position.

Average number of days

		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	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
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—

The analysis of Cadence Design Systems Inc's activity ratios reveals interesting trends over time.

Days of Inventory on Hand (DOH):
The DOH ratio measures how many days it takes for the company to sell its average inventory. In the case of Cadence Design Systems Inc, we observe fluctuations in this ratio from a low of 56.46 days in June 2020 to a high of 243.84 days in September 2024. The company's inventory management seems to have deteriorated significantly towards the end of the period, with the DOH increasing drastically. This could indicate potential issues with inventory control or demand forecasting.

Days of Sales Outstanding (DSO):
Unfortunately, data for the DSO ratio is not available for Cadence Design Systems Inc across the entire period. This ratio typically measures how long it takes for a company to collect its accounts receivable. The absence of data for this ratio makes it challenging to assess the company's efficiency in collecting outstanding payments from customers.

Number of Days of Payables:
Similar to DSO, information on the number of days of payables is not provided for Cadence Design Systems Inc. This ratio indicates the number of days it takes a company to pay off its suppliers. Without data for this ratio, it is difficult to evaluate the company's payment practices and liquidity management.

In conclusion, while the analysis of Cadence Design Systems Inc's activity ratios provides some insights into its inventory management, the lack of data for DSO and payables ratios limits our ability to comprehensively assess the company's overall efficiency in managing its working capital and cash flow.

Long-term

	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
Fixed asset turnover	—	—	—	—	—	10.33	10.27	9.87	9.59	9.86	10.37	10.15	9.77	9.81	9.57	9.18	8.62	8.75	8.61	8.45
Total asset turnover	0.52	0.47	0.58	0.71	0.72	0.72	0.74	0.71	0.69	0.69	0.75	0.72	0.68	0.71	0.70	0.70	0.68	0.61	0.61	0.63

Cadence Design Systems Inc's fixed asset turnover ratio has shown an increasing trend over the years, starting at 8.45 in March 2020 and reaching 10.37 in June 2022. However, there was a slight decline in the ratio to 9.59 by December 2022. The ratio then increased again to 10.33 by September 2023 but remained stagnant at 10.33 by December 2023. Unfortunately, data for the later periods was unavailable.

On the other hand, the total asset turnover ratio of Cadence Design Systems Inc has fluctuated, with values ranging from 0.58 in June 2024 to 0.75 in June 2022. The ratio was highest during this period and lowest in the most recent data available for June 2024. These fluctuations suggest variations in how efficiently the company is generating sales from its total assets over the years.

Overall, while the fixed asset turnover ratio demonstrates a generally increasing trend, the total asset turnover ratio has been more volatile, showing fluctuations over the years. Both ratios provide insights into Cadence Design Systems Inc's efficiency in utilizing its assets to generate sales.