AT&T Inc (T)

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	9.47	13.76	10.62	12.58	13.62	21.59	17.04	15.79	17.15	13.01	11.72	13.54	14.58	62.05	64.20	60.01	12.77	58.99	52.47	52.01
Days of sales outstanding (DSO)	days	30.68	26.87	27.96	30.77	34.66	34.48	34.10	49.15	47.85	49.62	43.96	45.50	51.58	40.91	39.86	40.56	45.60	45.88	44.51	49.06
Number of days of payables	days	118.85	—	—	—	135.60	—	—	—	146.11	—	—	—	129.22	—	—	—	132.18	—	—	—
Cash conversion cycle	days	-78.70	40.62	38.58	43.34	-87.32	56.07	51.14	64.93	-81.12	62.64	55.69	59.04	-63.06	102.96	104.06	100.58	-73.81	104.87	96.99	101.07

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 9.47 + 30.68 – 118.85
= -78.70

The cash conversion cycle for AT&T, Inc. fluctuated significantly over the past eight quarters. In Q4 2023 and Q4 2022, the company had negative cash conversion cycles, indicating that it was able to convert its invested resources back into cash quickly. This may suggest efficient management of working capital during those quarters.

However, in Q1-Q3 2023 and Q1-Q3 2022, the cash conversion cycle was positive, with an average of around 51.26 days. This suggests that the company took longer to convert its investments in inventory and accounts receivable into cash. A longer cash conversion cycle may indicate inefficiencies in managing working capital or potential issues with inventory turnover or accounts receivable collection.

Overall, AT&T, Inc. should aim to minimize its cash conversion cycle to improve its liquidity position and optimize its working capital management. Monitoring and analyzing the components of the cash conversion cycle, such as inventory turnover and accounts receivable collection efficiency, can help the company identify areas for improvement and enhance its cash flow performance.