First Solar Inc (FSLR)

Days of sales outstanding (DSO)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Receivables turnover		2.49	2.47	8.08	6.81	9.26
DSO	days	146.36	147.64	45.20	53.62	39.41

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 2.49
= 146.36

The Days Sales Outstanding (DSO) ratio measures the average number of days it takes for a company to collect revenue after a sale is made. In the case of First Solar Inc, the DSO has shown varying trends over the past five years based on the provided data.

As of December 31, 2020, the DSO stood at 39.41 days, indicating that on average, the company collected revenue relatively quickly after making a sale. However, by December 31, 2021, the DSO had increased to 53.62 days, suggesting a slight delay in collecting revenue compared to the previous year.

In the subsequent years, the DSO fluctuated further. By December 31, 2022, the DSO decreased to 45.20 days, showing some improvement in the collection of revenue. However, there was a significant spike in the DSO by December 31, 2023, soaring to 147.64 days, which could indicate potential challenges in collecting payments promptly.

The trend continued in December 31, 2024, with the DSO remaining high at 146.36 days, reflecting a continued delay in collecting revenue. It's important for First Solar to closely monitor and potentially improve its credit and collection policies to ensure timely cash inflows and efficient working capital management.