Qualcomm Incorporated (QCOM)

Cash conversion cycle

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Days of inventory on hand (DOH)	days	137.42	147.71	124.20	82.61	102.46
Days of sales outstanding (DSO)	days	22.32	19.97	34.75	24.19	41.85
Number of days of payables	days	55.28	43.98	74.35	70.38	88.66
Cash conversion cycle	days	104.46	123.71	84.60	36.43	55.65

September 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 137.42 + 22.32 – 55.28
= 104.46

The cash conversion cycle of Qualcomm Incorporated has fluctuated over the past five years. In the most recent period ending on September 30, 2024, the company's cash conversion cycle was 104.46 days, indicating that it took approximately 104 days for Qualcomm to convert its investments in inventory and accounts receivable into cash from sales.

Comparing this to prior years, we observe an upward trend from 2021 to 2023, where the cash conversion cycle increased significantly from 36.43 days to 123.71 days. This suggests potential challenges in managing working capital efficiency during these years.

In 2020 and 2022, there were improvements in the cash conversion cycle, showing better efficiency in the company's cash conversion process. However, the cycle increased again in 2023, indicating possible issues with inventory management or accounts receivable collection during that period.

Overall, Qualcomm's cash conversion cycle has experienced fluctuations, indicating varying degrees of efficiency in managing cash flows from operational activities over the past five years. Further analysis of specific components contributing to the cycle could provide insights into areas for potential improvement in working capital management practices.