Crowdstrike Holdings Inc (CRWD)

Cash conversion cycle

		Jan 31, 2024	Jan 31, 2023	Jan 31, 2022	Jan 31, 2021	Jan 31, 2020
Days of inventory on hand (DOH)	days	—	37.08	37.46	35.87	29.41
Days of sales outstanding (DSO)	days	97.96	100.29	93.70	99.53	122.91
Number of days of payables	days	4.46	9.00	14.07	5.35	0.92
Cash conversion cycle	days	93.50	128.36	117.09	130.05	151.40

January 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 97.96 – 4.46
= 93.50

Crowdstrike Holdings Inc's cash conversion cycle has shown fluctuations over the past five years. In the most recent period as of January 31, 2024, the company's cash conversion cycle stands at 93.50 days, reflecting an improvement compared to the prior year. This indicates that Crowdstrike is managing its cash flow more efficiently, converting its investments in inventory and accounts receivable into cash at a faster rate.

Looking back over the last five years, the trend in the cash conversion cycle shows some variability. In 2023, there was a significant increase in the cash conversion cycle to 128.36 days, suggesting a longer period required to convert investments into cash. However, the company then managed to reduce this cycle in 2024, potentially indicating stronger working capital management practices.

Comparing to the earlier years, Crowdstrike's cash conversion cycle was notably higher in 2020 at 151.40 days, which implies the company took a longer time to convert its resources into cash during that period. Subsequent years witnessed some improvements in efficiency, with the cycle generally trending downwards.

Overall, Crowdstrike Holdings Inc appears to be making progress in optimizing its cash conversion cycle, indicating more effective management of its working capital and potentially enhancing its overall financial health and liquidity position. However, continued monitoring and analysis of this metric will be essential to ensure sustained operational efficiency and financial performance.