Hewlett Packard Enterprise Co (HPE)
Days of sales outstanding (DSO)
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 4.06 | 4.15 | 6.95 | 6.98 | 7.97 | |
| DSO | days | 89.90 | 88.00 | 52.53 | 52.27 | 45.80 |
October 31, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 4.06
= 89.90
Analyzing Hewlett Packard Enterprise Co's Days of Sales Outstanding (DSO) over the past five years reveals fluctuations in the efficiency of their accounts receivable management. The DSO indicates the average number of days it takes for the company to collect revenue after making a sale.
The trend of increasing DSO from 45.80 days in 2020 to 89.90 days in 2024 is a cause for concern as it suggests a potential slowdown in collecting payments from customers. This increase may lead to cash flow challenges and indicate difficulties in managing accounts receivable efficiently.
The spike in DSO in 2024 compared to the previous years could be attributed to changes in credit policies, customer payment behavior, or issues with collection processes. It is essential for Hewlett Packard Enterprise Co to address this trend promptly to prevent liquidity issues and ensure a healthy cash flow.
The comparatively lower DSO figures in 2020 and 2021 (45.80 and 52.27 days, respectively) indicate a more efficient collection process during those periods. However, the subsequent increase in 2022, 2023, and 2024 raises concerns about potential challenges in managing accounts receivable effectively.
Overall, the analysis of Hewlett Packard Enterprise Co's DSO highlights the importance of closely monitoring and managing accounts receivable to maintain healthy cash flow and financial stability. Addressing the reasons behind the increasing DSO trend will be crucial for improving the company's overall financial performance and sustainability.
Peer comparison
Oct 31, 2024
See also:
Hewlett Packard Enterprise Co Average Receivable Collection Period