Dropbox Inc (DBX)
Cash conversion cycle
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Days of inventory on hand (DOH) | days | — | — | — | — | — |
Days of sales outstanding (DSO) | days | 11.04 | 9.43 | 9.07 | 8.79 | 9.70 |
Number of days of payables | days | 10.29 | 10.21 | 7.50 | 4.30 | 12.47 |
Cash conversion cycle | days | 0.75 | -0.78 | 1.57 | 4.49 | -2.78 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 11.04 – 10.29
= 0.75
Dropbox Inc's cash conversion cycle improved steadily from 2019 to 2023. The negative values indicate that the company is efficiently managing its working capital. In 2019, the cash conversion cycle was -28.08 days, demonstrating that the company converted its investments in inventory and accounts receivables into cash quickly. Over the next four years, the cycle continued to decrease, reaching -19.34 days by the end of 2023. This suggests that Dropbox has been able to streamline its operational processes and better manage its inventory and receivables, leading to quicker cash generation. Overall, the trend of declining cash conversion cycle reflects the company's effective working capital management and ability to convert its resources into cash efficiently.
Peer comparison
Dec 31, 2023