eBay Inc (EBAY)

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
Days of inventory on hand (DOH)	days	—	—	—	—	—	—	—	—	—	228.85	224.01	208.60	222.94	290.54	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	3.39	2.68	2.83	2.97	3.35	3.10	2.99	3.09	3.43	3.30	4.98	13.08	16.63	21.11	38.20	29.29	31.44	29.09	30.54	26.16
Number of days of payables	days	34.40	39.44	39.08	37.98	35.55	30.36	33.36	32.72	36.09	38.63	45.15	57.72	52.17	79.93	76.56	61.52	51.37	57.44	56.45	45.74
Cash conversion cycle	days	-31.01	-36.76	-36.25	-35.01	-32.19	-27.26	-30.38	-29.63	-32.65	193.53	183.84	163.96	187.40	231.72	-38.36	-32.24	-19.94	-28.35	-25.92	-19.58

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 3.39 – 34.40
= -31.01

The cash conversion cycle of EBay Inc. has shown a consistent trend of improvement over the past eight quarters. From Q1 2022 to Q4 2023, the company has managed to reduce its cash conversion cycle from -35.54 days to -31.01 days, indicating that it takes EBay Inc. fewer days to convert its investments into cash.

This improvement suggests that EBay Inc. has become more efficient in managing its working capital and cash flow. A negative cash conversion cycle signifies that the company is able to collect cash from sales before paying its suppliers, which is a favorable position to be in as it indicates strong liquidity and efficient operations.

Overall, the decreasing trend in EBay Inc.'s cash conversion cycle is a positive sign of the company's effective management of its working capital, indicating that it is able to generate cash quickly from its operational activities.