Netflix Inc (NFLX)

Days of sales outstanding (DSO) is a financial ratio that measures the average number of days it takes a company to collect payment after making a sale. A lower DSO indicates a more efficient collection process and better liquidity, while a higher DSO may signal potential issues with receivables management or customer creditworthiness.

Analyzing the DSO trend of Netflix Inc over the past few quarters, we observe fluctuations in the collection period. From March 31, 2020, to December 31, 2022, Netflix maintained a relatively stable DSO range between 8.62 days to 27.99 days. However, in the subsequent quarters, there was a noticeable increase in DSO, reaching its peak at 27.99 days on December 31, 2022. This significant rise could indicate difficulties in collecting payments promptly or changes in customer payment behavior.

The DSO declined in the following quarters but remained elevated compared to previous periods, indicating continued challenges in the collection process. It is essential for Netflix to closely monitor and address the increase in DSO to ensure efficient cash flow management and timely collections. A prolonged high DSO could potentially impact the company's liquidity and working capital, highlighting the need for proactive measures to improve receivables management.