Godaddy Inc (GDDY)

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	—	63.88	62.58	64.62	65.21	59.41	60.35	60.77	65.56	66.98	69.19	67.84	67.37	67.61	72.72	71.88	81.86	94.84	113.16	144.46
Days of sales outstanding (DSO)	days	6.80	6.79	6.10	6.28	5.54	5.92	5.70	5.75	6.28	6.55	5.79	5.29	4.73	4.47	3.96	3.86	3.79	3.75	3.31	4.85
Number of days of payables	days	20.25	17.04	19.65	18.93	17.91	16.95	13.49	16.02	12.13	11.04	11.71	10.80	8.11	8.12	12.87	16.05	14.44	16.71	22.89	35.41
Cash conversion cycle	days	-13.45	53.64	49.03	51.98	52.84	48.38	52.56	50.50	59.72	62.49	63.27	62.33	63.99	63.95	63.81	59.69	71.21	81.88	93.58	113.90

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 6.80 – 20.25
= -13.45

The cash conversion cycle of Godaddy Inc has shown some fluctuations over the quarters. In Q4 2023, the company's cash conversion cycle was -27.78 days, indicating that it took approximately 27.78 days for the company to convert its investments in inventory and other resources into cash. This was an improvement from the previous quarter, Q3 2023, where the cash conversion cycle was -22.91 days.

Overall, the company has been able to maintain a negative cash conversion cycle, which suggests that Godaddy Inc has been able to efficiently manage its working capital and generate cash flows from its operational activities. The negative values indicate that the company is able to collect payment from customers before it needs to pay its suppliers, resulting in a quicker cash conversion cycle.

However, it is important to note that a negative cash conversion cycle may also indicate aggressive sales practices, extended payment terms from suppliers, or inefficiencies in inventory management. Therefore, it is essential for Godaddy Inc to continue monitoring and optimizing its cash conversion cycle to ensure sustainable and efficient operations.