InterDigital Inc (IDCC)
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 | — | 62.85 | — | — | 99.69 | 127.13 | 161.60 | — | — | 114.23 | 101.53 | 67.00 | 264.75 | 58.40 | 66.40 | 90.25 | — | — | — | — |
| Days of sales outstanding (DSO) | days | 87.30 | 121.98 | 126.05 | 106.22 | 96.69 | 54.96 | 60.19 | 49.04 | 106.73 | 56.13 | 51.76 | 47.36 | 79.12 | 47.05 | 51.07 | 74.71 | 75.40 | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 87.30 | 184.84 | 126.05 | 106.22 | 196.38 | 182.10 | 221.79 | 49.04 | 106.73 | 170.36 | 153.29 | 114.36 | 343.87 | 105.45 | 117.47 | 164.97 | 75.40 | 0.00 | 0.00 | 0.00 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 87.30 – —
= 87.30
The cash conversion cycle of InterDigital Inc has shown fluctuations over the periods under consideration. In December 2020, the company had a cash conversion cycle of 75.40 days, indicating that it takes approximately 75 days for the company to convert its investments in inventory and other resources into cash inflows from sales. This period extended significantly in the following quarters, reaching a peak of 343.87 days in December 2021, before gradually decreasing to 87.30 days in December 2024.
A shorter cash conversion cycle is generally preferred as it indicates a more efficient management of working capital. The significant increase in the cash conversion cycle in 2021 could be indicative of issues such as slower collection of receivables, managing inventory levels effectively, or delays in paying suppliers.
It is essential for InterDigital Inc to closely monitor its cash conversion cycle to ensure optimal management of its working capital and cash flow. Strategies to improve this metric could include more efficient inventory management, timely collection of receivables, and negotiation of favorable payment terms with suppliers.
Peer comparison
Dec 31, 2024