Skyworks Solutions Inc (SWKS)

Cash conversion cycle

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Days of inventory on hand (DOH)	days	116.58	153.35	113.81	103.32	142.98
Days of sales outstanding (DSO)	days	44.45	66.10	73.43	54.17	38.99
Number of days of payables	days	25.52	21.80	25.75	27.55	40.25
Cash conversion cycle	days	135.51	197.65	161.50	129.93	141.72

September 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 116.58 + 44.45 – 25.52
= 135.51

Analyzing the cash conversion cycle of Skyworks Solutions Inc over the past five years reveals fluctuations in the efficiency of the company's working capital management. The trend shows that in 2023, the cash conversion cycle was at its highest level at 197.65 days, indicating a longer time taken by the company to convert its investment in inventory and receivables into cash. This was followed by a notable decrease in 2024 to 135.51 days, suggesting an improvement in efficiency.

Comparing the latest figure to previous years, it can be observed that while the cash conversion cycle in 2024 has improved compared to 2023, it is still higher than that of 2021 (129.93 days) and 2020 (141.72 days). This implies that Skyworks Solutions Inc is taking a slightly longer time to convert its investments in inventory and receivables into cash in 2024 compared to the previous two years.

Overall, fluctuations in the cash conversion cycle indicate changes in the company's working capital management efficiency, and further analysis of the underlying factors driving these changes would be necessary to understand the specific areas of improvement or concern for Skyworks Solutions Inc.