Salesforce.com Inc (CRM)

Days of sales outstanding (DSO)

		Jan 31, 2024	Jan 31, 2023	Jan 31, 2022	Jan 31, 2021	Jan 31, 2020
Receivables turnover		3.05	2.90	2.89	2.83	2.81
DSO	days	119.48	125.77	126.22	129.02	130.10

January 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 3.05
= 119.48

The Days Sales Outstanding (DSO) is a measure of how long it takes a company to collect payment from its customers after making a sale. A lower DSO indicates that a company is collecting payments more quickly, which is generally seen as a positive indicator of efficient cash flow management.

Analyzing the trend of DSO for Salesforce Inc over the past five years, we observe a fluctuating pattern. The DSO decreased from 131.80 days in January 2020 to 119.52 days in January 2024. This decrease suggests that Salesforce Inc has improved its efficiency in collecting payments from customers over the period.

However, it is worth noting that the DSO increased in the intervening years, reaching a peak of 134.18 days in January 2022, before trending downwards again. This fluctuation may indicate some variability in Salesforce Inc's customer payment behavior or changes in its sales and collection processes.

Overall, while the recent decrease in DSO is a positive sign for Salesforce Inc's cash flow management, it is important for the company to monitor and manage its DSO effectively to ensure timely collection of payments and maintain healthy liquidity levels.