Super Micro Computer Inc (SMCI)
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 | 116.39 | 122.79 | 90.34 | 104.60 | 94.99 | 126.58 | 128.33 | 146.00 | 141.32 | 131.61 | 125.69 | 114.88 | 107.63 | 101.73 | 110.48 | 114.44 | 93.33 | 88.51 | 81.41 | 96.63 |
| Days of sales outstanding (DSO) | days | 59.29 | 41.77 | 58.84 | 37.31 | 42.19 | 44.68 | 59.21 | 53.59 | 43.54 | 43.68 | 48.48 | 45.25 | 37.84 | 35.82 | 45.08 | 39.12 | 42.20 | 41.02 | 42.45 | 37.25 |
| Number of days of payables | days | 59.52 | 64.85 | 48.55 | 43.58 | 37.41 | 57.24 | 54.42 | 71.65 | 70.49 | 62.73 | 73.94 | 59.10 | 52.82 | 43.82 | 54.19 | 61.15 | 52.01 | 42.91 | 43.79 | 42.15 |
| Cash conversion cycle | days | 116.16 | 99.71 | 100.63 | 98.33 | 99.77 | 114.02 | 133.12 | 127.94 | 114.37 | 112.56 | 100.24 | 101.03 | 92.64 | 93.73 | 101.37 | 92.42 | 83.53 | 86.62 | 80.07 | 91.73 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 116.39 + 59.29 – 59.52
= 116.16
Super Micro Computer Inc's cash conversion cycle has fluctuated over the past eight quarters, indicating variations in efficiency in managing its working capital. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources to cash flows from sales.
In Q2 2024, the company's cash conversion cycle was 116.16 days, an increase from the previous quarter's 99.71 days. This suggests that Super Micro Computer Inc took longer to convert its investments into cash during that quarter. However, the cycle was still more efficient compared to two quarters ago when it reached 123.12 days.
The lowest cash conversion cycle was recorded in Q1 2024 at 99.71 days, indicating an improvement in working capital management efficiency. Conversely, the highest cycle was observed in Q4 2022 at 142.23 days, reflecting a longer period to convert investments into cash flows.
Overall, Super Micro Computer Inc should focus on better inventory management and optimizing its accounts receivable and accounts payable processes to shorten its cash conversion cycle. This would help improve liquidity, optimize working capital, and enhance overall financial performance.
Peer comparison
Dec 31, 2023
See also:
Super Micro Computer Inc Cash Conversion Cycle (Quarterly Data)