ResMed Inc (RMD)

Cash conversion cycle

		Jun 30, 2025	Mar 31, 2025	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	161.91	151.21	155.36	162.85	156.87	159.43	180.93	192.09	195.08	210.33	221.58	201.63	174.75	156.89	144.55	128.23	122.86	136.61	134.18	138.13
Days of sales outstanding (DSO)	days	66.63	68.29	71.10	61.59	67.22	63.99	61.02	59.66	60.93	62.38	65.20	62.49	58.75	52.45	55.75	62.73	70.14	61.99	60.13	56.04
Number of days of payables	days	48.55	39.01	38.80	44.22	45.35	34.11	39.24	35.49	29.47	33.67	43.92	42.31	37.41	35.34	39.88	43.96	37.10	33.08	34.52	33.98
Cash conversion cycle	days	180.00	180.48	187.66	180.22	178.74	189.32	202.71	216.26	226.54	239.04	242.87	221.81	196.09	173.99	160.42	147.00	155.90	165.53	159.79	160.19

June 30, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 161.91 + 66.63 – 48.55
= 180.00

The analysis of ResMed Inc.'s cash conversion cycle (CCC) over the given periods reveals notable fluctuations and a general trend toward stabilization in recent quarters. The CCC measures the time (in days) it takes for the company to convert its investments in inventory and other resources into cash flows from sales, encompassing the stages of inventory turnover, receivables collection, and payables deferral.

Between September 30, 2020, and September 30, 2021, the CCC exhibited some variability, decreasing from approximately 160 days in September 2020 to a low of around 147 days in September 2021, indicating improvement in operational efficiency and cash flow management during that period. However, subsequent quarters manifested a rising trend, reaching a peak of approximately 242.87 days as of December 2022, which suggests a lengthening of the cash conversion cycle and potential challenges in inventory, receivables, or payables management.

From the end of 2022 through March 2023, the CCC remained elevated at around 239 days, then gradually declined over the following quarters, reaching approximately 178.74 days by June 30, 2024. This downward movement signifies an improvement in cash flow management, potentially through better inventory turnover, faster receivables collection, or more favorable payables terms.

As of the most recent data available, the CCC stood at approximately 180.22 days on September 30, 2024, and further edged down to about 180 days in June 2025. This stabilization near the 180-day mark indicates a balanced cycle, signifying that ResMed's operational efficiencies may have improved and stabilized over the recent periods.

Overall, the temporal pattern depicts a period of increased CCC from late 2021 through 2022, followed by a strategic correction and stabilization from 2023 through mid-2025. These dynamics suggest adjustments in working capital management, possibly reflecting strategic responses to market conditions, supply chain factors, or company-specific operational changes aimed at optimizing cash flow and liquidity.