Synopsys Inc (SNPS)

Cash conversion cycle

		Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020	Jan 31, 2020	Oct 31, 2019	Jul 31, 2019	Apr 30, 2019
Days of inventory on hand (DOH)	days	110.26	97.24	88.03	82.37	73.89	72.72	78.96	82.08	85.33	97.00	103.34	100.02	104.07	88.34	77.48	81.38	71.77	68.60	74.42	79.93
Days of sales outstanding (DSO)	days	63.36	62.91	44.01	53.83	73.06	60.50	50.34	55.45	84.18	52.45	51.73	56.09	75.40	82.37	66.38	68.15	86.43	64.30	50.52	59.49
Number of days of payables	days	22.13	46.56	20.72	27.11	23.50	12.90	25.87	28.62	11.70	11.61	17.70	19.19	11.44	13.78	18.00	25.31	12.88	9.61	7.12	15.00
Cash conversion cycle	days	151.49	113.59	111.33	109.09	123.45	120.33	103.43	108.90	157.80	137.84	137.36	136.93	168.03	156.93	125.86	124.23	145.32	123.30	117.81	124.42

January 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 110.26 + 63.36 – 22.13
= 151.49

The cash conversion cycle of Synopsys, Inc. has shown fluctuations over the past eight quarters. In Q1 2024, the company's cash conversion cycle increased to 151.49 days, which is higher compared to the previous quarter. This indicates that Synopsys took longer to convert its investments in inventory and accounts receivable into cash during this period.

In contrast, the cash conversion cycle decreased to 109.84 days in Q4 2023, showing an improvement in the company's efficiency in managing its working capital compared to the previous quarter. However, this improvement was not sustained in Q3 2023, where the cash conversion cycle increased to 111.33 days.

Overall, there seems to be some variability in Synopsys' cash conversion cycle, with fluctuations observed across the different quarters. It is crucial for the company to closely monitor and manage its working capital components to ensure optimal cash flow efficiency and stability moving forward.