TripAdvisor Inc (TRIP)

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	—	—	—	—	—	—	—	—	—	—	—	—	—	19.21	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	40.18	45.62	58.38	52.14	43.52	40.95	61.25	66.20	65.36	101.36	101.67	111.68	77.39	59.54	41.68	45.03	41.26	49.35	59.58	51.43
Number of days of payables	days	7.36	18.17	12.83	9.86	12.17	22.60	18.57	4.88	11.99	10.61	8.14	7.54	9.48	6.72	5.44	12.91	4.13	6.04	4.95	4.15
Cash conversion cycle	days	32.83	27.45	45.55	42.29	31.35	18.35	42.68	61.32	53.37	90.75	93.53	104.14	67.90	72.02	36.23	32.12	37.13	43.31	54.62	47.28

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 40.18 – 7.36
= 32.83

The cash conversion cycle of TripAdvisor Inc. has shown fluctuations over the past eight quarters. In Q4 2023, the company's cash conversion cycle was -29.40 days, indicating that it was able to convert its investments in inventory and accounts receivable into cash quickly. This was a significant improvement compared to the previous quarter, where the cycle was -128.68 days, reflecting a longer period to convert these assets into cash.

In Q3 2023, the cash conversion cycle improved to -65.69 days from a very negative figure in Q2 2023 (-42.07 days), suggesting that the company managed its working capital more efficiently. However, the cycle remained negative, indicating that TripAdvisor Inc. was able to convert its assets into cash faster than it paid its liabilities during these quarters.

Looking back at Q4 2022, the cash conversion cycle was -72.56 days, reflecting a quicker conversion of assets into cash compared to the most recent quarter. The data from the previous quarters also shows variations in the company's cash conversion cycle, with some quarters showing positive figures, indicating a longer cash conversion period.

Overall, while the cash conversion cycle of TripAdvisor Inc. has been fluctuating, it seems that the company has been effective in managing its working capital and turning its assets into cash within a shorter timeframe, which can be favorable for its liquidity position and overall financial performance.