Nike Inc (NKE)
Cash conversion cycle
| May 31, 2025 | Feb 28, 2025 | Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 103.08 | 102.44 | 107.35 | 109.19 | 96.38 | 98.14 | 100.83 | 109.20 | 106.68 | 114.34 | 125.10 | 136.95 | 121.81 | 111.58 | 94.90 | 96.74 | 101.79 | 111.82 | 101.78 | 115.30 |
| Days of sales outstanding (DSO) | days | 37.18 | 34.28 | 39.51 | 34.77 | 31.46 | 32.03 | 33.86 | 33.68 | 29.44 | 32.54 | 40.41 | 38.40 | 36.47 | 29.83 | 29.53 | 34.30 | 36.58 | 34.78 | 35.43 | 37.28 |
| Number of days of payables | days | 47.88 | 42.20 | 43.78 | 44.41 | 36.54 | 29.73 | 34.23 | 34.38 | 36.12 | 34.35 | 37.69 | 47.78 | 48.58 | 40.14 | 40.77 | 30.83 | 42.12 | 37.71 | 36.00 | 34.10 |
| Cash conversion cycle | days | 92.37 | 94.51 | 103.08 | 99.54 | 91.30 | 100.45 | 100.46 | 108.51 | 100.00 | 112.53 | 127.82 | 127.57 | 109.70 | 101.27 | 83.66 | 100.21 | 96.25 | 108.89 | 101.21 | 118.47 |
May 31, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 103.08 + 37.18 – 47.88
= 92.37
The analysis of Nike Inc's cash conversion cycle (CCC) over the period from August 2020 to May 2025 reveals notable fluctuations and a general trend toward stabilization in recent periods. The CCC measures the time (in days) it takes for the company to convert its investments in inventory and other resource inputs into cash flows from sales, combining three key components: days inventory outstanding (DIO), days sales outstanding (DSO), and days payable outstanding (DPO).
Initially, in August 2020, the CCC stood at approximately 118.47 days. This figure decreased significantly over the subsequent periods, reaching its lowest point in May 2023 at 100.00 days. The period from August 2020 through May 2023 exhibits a downward trend in the CCC, driven by improvements in inventory management and receivables collection, as well as a possible extension of payables.
Following the May 2023 low, there was a slight increase in the CCC, peaking at 127.82 days in November 2022 before decreasing again. From May 2023 onwards, the CCC stabilized around the 100-day mark, ending at 92.37 days in May 2025.
The overall trend indicates that Nike Inc has been progressively optimizing its working capital management, reducing the time it takes to convert inventory into cash. The decline in CCC suggests increased efficiency in inventory turnover, faster receivables collection, or a strategic extension of payables. The stabilization in recent periods reflects a balanced approach to managing these components, aligning the company's cash flow cycle with operational efficiency.
In conclusion, Nike Inc's cash conversion cycle has generally shortened over the observed period, illustrating improved operational cash flow efficiency. The recent stabilization around the low 90s days suggests a mature and steady working capital management strategy, which likely enhances liquidity and financial flexibility.
Peer comparison
May 31, 2025