Cisco Systems Inc (CSCO)

Cash conversion cycle

		Jul 27, 2024	Jul 29, 2023	Jul 30, 2022	Jul 31, 2021	Jul 25, 2020
Days of inventory on hand (DOH)	days	36.44	38.66	30.41	18.71	15.93
Days of sales outstanding (DSO)	days	67.92	59.58	74.63	74.53	78.40
Number of days of payables	days	24.89	24.54	27.01	28.35	27.56
Cash conversion cycle	days	79.47	73.70	78.03	64.89	66.77

July 27, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 36.44 + 67.92 – 24.89
= 79.47

The cash conversion cycle of Cisco Systems Inc has displayed fluctuations over the past five years. In the most recent year ending July 27, 2024, the cycle stood at 79.47 days, showing an increase from the previous year's 73.70 days. This indicates that the company took longer to convert its investments in inventory and accounts receivable into cash during the most recent fiscal year. However, compared to two years ago, the cycle has decreased from 78.03 days to the current level, suggesting an improvement in efficiency during the interim period. In contrast, when compared to the fiscal years ending July 31, 2021, and July 25, 2020, the cash conversion cycle has increased from 64.89 days and 66.77 days, respectively, indicating a longer cash conversion period.

Overall, Cisco Systems Inc's cash conversion cycle has experienced variability in recent years, with fluctuations impacting its ability to efficiently manage its working capital. Further analysis of the underlying factors contributing to these variations would provide additional insights into the company's operational and financial performance.