Southwest Airlines Company (LUV)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		76.73	71.54	19.62	11.67	157.93
DSO	days	4.76	5.10	18.60	31.26	2.31

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 76.73
= 4.76

Southwest Airlines Co's days of sales outstanding (DSO) have shown fluctuations over the past five years. In 2023, the DSO was 16.14 days, slightly higher compared to the previous year's DSO of 15.94 days. This indicates that the company takes around 16 days on average to collect its accounts receivable.

In 2021, Southwest Airlines Co's DSO was 31.37 days, significantly higher than in the preceding years. The increase in DSO in 2021 suggests that the company took longer to collect its accounts receivable, possibly due to changes in customer payment behaviors, economic conditions, or internal credit and collection policies.

Comparing to 2020, where the DSO was 45.58 days, the significant decrease in 2021 indicates improvement in the company's ability to collect payments from customers more promptly.

In 2019, the DSO was 17.67 days, showing a slight increase in 2023. Overall, Southwest Airlines Co's DSO has shown some variability over the past five years, reflecting changes in the company's efficiency in managing its accounts receivable and collecting payments from customers.