Alphabet Inc Class C (GOOG)

Cash conversion cycle

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	—	—	—	—	—	8.23	6.31	6.64	7.72	9.30	6.01	4.29	3.85	4.48	3.39	3.61	3.14	3.83	3.91	4.33
Days of sales outstanding (DSO)	days	54.76	52.94	52.64	51.44	57.32	50.81	49.22	46.45	52.20	46.76	48.70	48.15	57.13	53.32	54.64	53.11	63.04	54.41	47.62	52.10
Number of days of payables	days	19.93	17.96	15.88	16.58	20.51	16.16	15.03	12.00	14.83	18.58	13.38	10.77	19.86	16.20	17.62	19.50	24.08	20.12	19.49	19.98
Cash conversion cycle	days	34.84	34.99	36.76	34.86	36.80	42.89	40.50	41.09	45.09	37.49	41.33	41.67	41.12	41.60	40.42	37.21	42.10	38.12	32.04	36.45

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 54.76 – 19.93
= 34.84

The cash conversion cycle for Alphabet Inc Class C has shown fluctuations over the provided periods. The cycle represents the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales.

From March 31, 2020, to December 31, 2024, the cycle ranged from a low of 32.04 days in June 2020 to a high of 45.09 days in December 2022. Generally, a lower cash conversion cycle indicates that the company is efficiently managing its working capital and converting its investments into cash quickly.

However, the cycle saw increases in certain periods, such as the upward trend from September 2020 to December 2022, indicating potential inefficiencies in managing inventory, accounts receivable, or accounts payable. Conversely, a decreasing trend from December 2022 to December 2024 suggests improvements in managing working capital and streamlining operations to convert investments into cash more effectively.

Overall, tracking the cash conversion cycle provides insights into Alphabet Inc Class C's operational efficiency and working capital management over time, highlighting areas for improvement or potential strengths in its financial performance.