MaxLinear Inc (MXL)

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	198.95	193.03	167.69	142.93	118.55	110.98	105.93	116.35	124.55	134.82	123.98	124.31	121.22	115.60	91.59	101.26	134.35	203.30	92.52	80.36
Days of sales outstanding (DSO)	days	86.52	44.43	69.18	85.31	89.83	67.27	56.39	62.35	55.71	60.32	48.97	48.45	48.97	46.48	64.47	51.04	51.43	108.66	54.54	55.51
Number of days of payables	days	69.10	61.55	63.08	48.17	25.57	43.64	38.54	42.45	53.20	73.79	61.93	53.83	48.76	57.77	49.73	42.92	44.97	98.42	48.12	35.15
Cash conversion cycle	days	216.37	175.92	173.80	180.08	182.81	134.61	123.77	136.25	127.05	121.34	111.03	118.92	121.43	104.32	106.34	109.38	140.81	213.54	98.94	100.72

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 198.95 + 86.52 – 69.10
= 216.37

The cash conversion cycle of MaxLinear Inc has shown some fluctuations over the years. The trend indicates that the company's ability to convert its resources into cash has varied.

From March 31, 2020, to December 31, 2024, the cash conversion cycle ranged from a low of 98.94 days to a high of 216.37 days. Generally, a shorter cash conversion cycle is more favorable as it indicates that the company is efficient in managing its working capital and converting its inventories into cash quickly.

In the analyzed period, there were periods where the cash conversion cycle increased significantly, such as in September 30, 2020, when it spiked to 213.54 days. This increase may indicate potential issues in managing accounts receivable, inventory, and accounts payable efficiently.

On the other hand, there were periods where the cash conversion cycle decreased, which could signal improvements in working capital management. For instance, the cycle decreased from 182.81 days on December 31, 2023, to 173.80 days on June 30, 2024.

Overall, the company should aim to maintain a lower cash conversion cycle consistently to enhance its liquidity position and operational efficiency. Regular monitoring and strategic adjustments to working capital management practices can help improve the cash conversion cycle and strengthen the company's financial health.