MaxLinear Inc (MXL)

Cash conversion cycle

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	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	76.93	87.05	97.29	93.10
Days of sales outstanding (DSO)	days	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	58.01	61.42	60.82	60.67
Number of days of payables	days	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	32.82	31.30	38.57	28.97
Cash conversion cycle	days	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	102.13	117.18	119.55	124.79

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 118.55 + 89.83 – 25.57
= 182.81

The cash conversion cycle (CCC) of MaxLinear Inc has shown some fluctuations over the past few quarters. The CCC measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A shorter CCC is generally preferred as it indicates that the company is effectively managing its working capital and minimizing the time between spending and receiving cash.

Looking at the data, we can observe that the CCC has fluctuated between 111.03 days and 182.81 days over the past eight quarters. A longer CCC, such as the one observed at the end of 2023, indicates that MaxLinear Inc is taking a longer time to convert its investments into cash, which may signify inefficiencies in inventory management or slower collection of receivables. On the other hand, the shorter CCC observed in the middle of 2022 suggests improved efficiency in working capital management.

It is important for investors and analysts to closely monitor the trend of the CCC, as consistently high or increasing values could potentially indicate financial stress or operational inefficiencies. Additionally, comparing the company's CCC to industry benchmarks can provide further insights into its working capital management relative to its peers.

Overall, the fluctuations in MaxLinear Inc's CCC over the past quarters highlight the importance of maintaining efficient working capital management to support the company's financial performance and liquidity.