Lam Research Corp (LRCX)

Cash conversion cycle

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Days of inventory on hand (DOH)	days	166.28	196.05	182.14	154.75	125.51
Days of sales outstanding (DSO)	days	66.88	61.69	59.13	91.40	75.53
Number of days of payables	days	—	28.54	38.24	39.45	38.72
Cash conversion cycle	days	233.16	229.21	203.02	206.69	162.31

June 30, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 166.28 + 66.88 – —
= 233.16

The cash conversion cycle (CCC) of Lam Research Corp has exhibited an overall increasing trend over the period from June 30, 2021, to June 30, 2025. Specifically, the CCC was 162.31 days as of June 30, 2021. This metric increased markedly to 206.69 days by June 30, 2022, reflecting a significant elongation in the time it takes the company to convert its investments in inventory and receivables into cash flows after accounting for its payables. The upward trend continued, albeit at a marginally slower pace, reaching 203.02 days by June 30, 2023. Subsequently, there was a further increase to 229.21 days as of June 30, 2024, and this rise persisted to 233.16 days by June 30, 2025.

The consistent increase in the CCC over this four-year span suggests a lengthening of the company's working capital cycle. This trend may indicate longer inventory holding periods, extended receivable collection times, or shifts in payable management strategies, potentially impacting the company's liquidity and operational efficiency. The prolonged cycle indicates that the company is now taking more time to recover cash from its core operating activities, which could influence its working capital management and overall cash flow performance in the analyzed period.