DexCom Inc (DXCM)
Cash conversion cycle
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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
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Days of inventory on hand (DOH) | days | 80.62 | 74.41 | 66.27 | 60.92 | 54.10 | 58.95 | 68.20 | 74.15 | 82.41 | 87.50 | 84.36 | 80.07 | 67.49 | 60.42 | 51.69 | 45.77 | 40.90 | 43.71 | 51.87 | 56.75 |
Days of sales outstanding (DSO) | days | 100.03 | 85.13 | 86.85 | 79.34 | 95.03 | 79.53 | 85.93 | 80.20 | 80.44 | 87.52 | 85.74 | 84.54 | 85.75 | 76.97 | 65.20 | 70.58 | 73.24 | 65.85 | 66.79 | 67.40 |
Number of days of payables | days | 39.82 | 36.18 | 42.35 | 44.31 | 41.96 | 37.55 | 44.11 | 32.52 | 45.20 | 52.30 | 43.83 | 42.07 | 46.96 | 44.44 | 33.90 | 35.55 | 34.93 | 36.81 | 42.72 | 50.69 |
Cash conversion cycle | days | 140.83 | 123.37 | 110.77 | 95.95 | 107.16 | 100.93 | 110.01 | 121.83 | 117.64 | 122.72 | 126.27 | 122.54 | 106.28 | 92.96 | 83.00 | 80.80 | 79.22 | 72.75 | 75.94 | 73.46 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 80.62 + 100.03 – 39.82
= 140.83
The cash conversion cycle of Dexcom Inc has shown some fluctuations over the past eight quarters. In Q4 2023, the company's cash conversion cycle increased to 177.03 days, reflecting a prolonged time taken to convert resources invested in inventory back into cash. This increase in the cash conversion cycle may indicate challenges in managing inventory levels efficiently or delays in collecting receivables.
However, in Q3 2023, the cash conversion cycle decreased to 160.64 days, suggesting an improvement in the company's ability to manage working capital effectively. This reduction may have been driven by better inventory management practices or faster collection of receivables during the quarter.
Looking back further, in Q2 2023 and Q1 2023, the cash conversion cycle continued to decrease, reaching 134.36 days and 112.69 days, respectively. These improvements indicate a trend towards more efficient working capital management, possibly through tighter control over inventory levels and faster collection of receivables.
Comparing these recent quarters to the same periods in the previous year, it is evident that Dexcom Inc has made progress in shortening its cash conversion cycle. For example, in Q4 2022, the cash conversion cycle was 118.81 days, which was lower than the corresponding quarter in 2023, indicating a significant improvement year over year.
Overall, Dexcom Inc's cash conversion cycle has shown both improvements and fluctuations in recent quarters, highlighting the company's efforts to optimize working capital management but also facing challenges that may impact its cash flow efficiency in certain periods.
Peer comparison
Dec 31, 2023