Garmin Ltd (GRMN)

Days of sales outstanding (DSO)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Receivables turnover		6.39	6.45	7.39	5.85	4.93
DSO	days	57.15	56.63	49.42	62.35	73.98

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.39
= 57.15

The Days Sales Outstanding (DSO) is a measure of how long it takes for a company to collect its accounts receivable. For Garmin Ltd, the trend in DSO over the past five years shows a decrease from 73.98 days as of December 31, 2020, to 62.35 days as of December 31, 2021, indicating an improvement in their collection efficiency.

However, there was a slight increase in DSO to 56.63 days as of December 31, 2023, followed by a relatively stable DSO of 57.15 days as of December 31, 2024. Overall, Garmin Ltd has managed to keep their DSO at relatively healthy levels, although there was a slight fluctuation in the middle years.

A lower DSO typically indicates that the company is collecting accounts receivable more quickly, which can be a positive sign of strong cash flow management and effective credit policies. It is important for Garmin Ltd to continue monitoring their DSO to ensure efficient collection of receivables and maintain a healthy cash flow position.