Rambus Inc (RMBS)

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 127.60 112.12 105.82 81.77 70.91 56.22 40.44 29.82 43.98 44.64 46.69 58.23 86.92 83.87 71.26 64.12 71.66 58.64 62.21 56.65
Days of sales outstanding (DSO) days 105.91 102.36 123.55 124.26 145.32 155.38 195.19 187.10 199.76 226.21 244.08 252.62 247.04 258.56 280.12 322.41 366.29 344.94 325.66 348.01
Number of days of payables days 63.79 50.79 55.69 56.59 84.19 81.01 88.36 75.19 58.48 73.33 52.04 45.77 54.03 78.59 86.44 102.41 67.84 56.11 51.99 57.22
Cash conversion cycle days 169.72 163.68 173.68 149.45 132.03 130.59 147.27 141.73 185.25 197.52 238.73 265.08 279.92 263.84 264.93 284.11 370.10 347.46 335.88 347.44

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 127.60 + 105.91 – 63.79
= 169.72

The cash conversion cycle of Rambus Inc. has shown some variability over the past eight quarters. In Q4 2023, the company's cash conversion cycle was 179.32 days, which increased from the previous quarter Q3 2023 at 172.40 days. This suggests that it took Rambus Inc. longer to convert its investments in inventory and receivables into cash in Q4 2023 than in the previous quarter.

Looking at the trend over the past two years, we see that the cash conversion cycle has generally been increasing, indicating potential inefficiencies in managing inventory and collecting receivables. The highest point in the cycle was in Q2 2023 at 180.73 days, while the lowest point was in Q4 2022 at 130.06 days.

The cash conversion cycle measures how long it takes for a company to convert its resources expended into cash inflows. A longer cycle may indicate liquidity issues, poor inventory management, or difficulties in collecting receivables. Rambus Inc. should focus on optimizing its inventory levels and enhancing its accounts receivable collection processes to shorten its cash conversion cycle, thereby improving its overall financial efficiency.


Peer comparison

Dec 31, 2023