Keysight Technologies Inc (KEYS)

Cash conversion cycle

		Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020
Days of inventory on hand (DOH)	days	107.50	107.61	92.90	87.13	92.38
Days of sales outstanding (DSO)	days	75.65	65.67	64.25	56.51	56.99
Number of days of payables	days	32.92	31.25	37.68	32.18	27.34
Cash conversion cycle	days	150.23	142.03	119.47	111.46	122.03

October 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 107.50 + 75.65 – 32.92
= 150.23

The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash from sales. Keysight Technologies Inc's cash conversion cycle has exhibited some fluctuation over the past five years.

In 2024, the cash conversion cycle increased to 150.23 days, indicating a longer period for the company to convert its investments into cash. This may suggest potential inefficiencies in managing inventory, collecting receivables, or paying payables.

Comparing this to the previous year, the cash conversion cycle was relatively shorter at 142.03 days in 2023. However, there was a significant improvement in efficiency in 2022 with a cycle of 119.47 days, indicating the company was managing its working capital more effectively.

The trend continued in 2021 with a cash conversion cycle of 111.46 days, showing further improvement in operational efficiency. In 2020, the cycle increased slightly to 122.03 days, but still remained better than the most recent year.

Overall, while there have been fluctuations in the cash conversion cycle of Keysight Technologies Inc, the general trend has shown improvements in working capital management efficiency, particularly in the earlier years. The company may need to focus on optimizing its processes to maintain or improve its cash conversion cycle in the future.