Cognizant Technology Solutions Corp Class A (CTSH)

Days of sales outstanding (DSO)

		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
Receivables turnover		4.86	4.62	4.85	5.05	5.03	5.10	5.16	5.22	5.12	5.25	5.09	5.17	5.20	5.10	5.09	5.21	5.39	5.37	5.22	5.25
DSO	days	75.07	79.08	75.27	72.28	72.59	71.50	70.67	69.90	71.32	69.47	71.76	70.62	70.15	71.52	71.67	70.10	67.66	67.94	69.88	69.55

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 4.86
= 75.07

Days of Sales Outstanding (DSO) is a key financial ratio that measures the average number of days it takes for a company to collect payment after making a sale. In the case of Cognizant Technology Solutions Corp Class A, the DSO has shown some fluctuations over the years based on the data provided.

From March 31, 2020, to December 31, 2023, the DSO remained relatively stable, fluctuating within a range of mid to high 60s days. However, from March 31, 2024, onwards, there was a noticeable increase in the DSO, reaching a peak of 79.08 days on September 30, 2024.

The increase in DSO may indicate that Cognizant is taking longer to collect payments from its customers, which could potentially have negative implications for cash flow and working capital management. It could be a signal of changes in customer payment behavior, sales terms, or collection efficiency within the organization.

Overall, monitoring the trend of DSO can provide insights into the company's accounts receivable management efficiency and its ability to convert sales into cash. Further analysis and comparison with industry benchmarks would be useful to assess the effectiveness of Cognizant's credit and collection policies.