Silicon Laboratories Inc (SLAB)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 141.66 | 220.47 | 96.06 | 60.91 | 80.85 |
| Days of sales outstanding (DSO) | days | 34.03 | 13.67 | 25.46 | 49.78 | 67.99 |
| Number of days of payables | days | 56.92 | 65.24 | 85.96 | 58.46 | 92.82 |
| Cash conversion cycle | days | 118.76 | 168.89 | 35.56 | 52.23 | 56.01 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 141.66 + 34.03 – 56.92
= 118.76
The cash conversion cycle of Silicon Laboratories Inc has shown fluctuations over the years based on the data provided.
As of December 31, 2020, the company had a cash conversion cycle of 56.01 days, indicating the average number of days it takes for the company to convert its investments in inventory into cash flows from sales.
By December 31, 2021, Silicon Laboratories Inc had improved its cash conversion cycle to 52.23 days, suggesting more efficient management of its working capital and inventory.
The trend continued positively by December 31, 2022, with the company achieving a significantly reduced cash conversion cycle of 35.56 days, indicating further improvements in its operational efficiency and cash flow management.
However, there was a noteworthy reversal in the trend by December 31, 2023, when the cash conversion cycle increased substantially to 168.89 days. This significant increase may indicate challenges in managing inventory, collecting receivables, or paying suppliers efficiently.
By the end of December 31, 2024, Silicon Laboratories Inc managed to reduce its cash conversion cycle to 118.76 days, but the cycle still remains higher compared to previous years, reflecting ongoing challenges in optimizing working capital management processes.
Overall, the analysis of the cash conversion cycle of Silicon Laboratories Inc highlights the company's efforts to enhance operational efficiency and working capital management, although fluctuations in the cycle indicate the need for continued focus on optimizing cash flow processes.
Peer comparison
Dec 31, 2024