Microchip Technology Inc (MCHP)

Days of sales outstanding (DSO)

		Mar 31, 2025	Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Receivables turnover		6.38	6.68	6.46	6.36	5.45
DSO	days	57.19	54.68	56.46	57.40	66.96

March 31, 2025 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.38
= 57.19

Based on the data provided for Microchip Technology Inc's Days Sales Outstanding (DSO) over the past five years, there has been a consistent downward trend in the DSO metric.

As of March 31, 2021, the DSO was reported at 66.96 days, which decreased to 57.40 days by March 31, 2022. This downward trend continued over the following years with the DSO decreasing to 56.46 days as of March 31, 2023, further dropping to 54.68 days by March 31, 2024, and slightly increasing to 57.19 days by March 31, 2025.

The decreasing trend in DSO indicates that Microchip Technology Inc has been able to collect its accounts receivable more efficiently over the years. A lower DSO value typically suggests that the company is collecting payments from its customers at a faster rate, which can improve cash flow and overall liquidity.

Overall, the trend in DSO for Microchip Technology Inc reflects positively on its accounts receivable management and indicates effective credit and collection policies in place. It is important for the company to continue monitoring and managing its DSO to ensure healthy cash flow and efficient working capital management.