Twilio Inc (TWLO)

Cash conversion cycle

Jun 30, 2025 Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Days of inventory on hand (DOH) days — — — — — — — — 11.06 — — — — — — — — — — —
Days of sales outstanding (DSO) days 45.38 46.00 48.19 46.34 46.26 47.07 49.45 49.57 54.03 53.09 52.23 48.85 50.64 47.47 49.86 49.55 48.81 47.37 52.04 48.16
Number of days of payables days 11.52 16.98 16.40 11.92 10.47 13.85 19.97 17.49 15.75 20.78 22.06 19.13 20.22 20.21 21.97 20.35 32.35 23.36 24.76 18.78
Cash conversion cycle days 33.85 29.02 31.78 34.42 35.79 33.22 29.48 32.08 49.34 32.31 30.16 29.72 30.41 27.26 27.89 29.20 16.46 24.01 27.28 29.38

June 30, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 45.38 – 11.52
= 33.85

The analysis of Twilio Inc.'s cash conversion cycle (CCC) from September 2020 through June 2025 reveals notable fluctuations over the period, reflecting shifts in the company's operational efficiency and working capital management.

During the initial period (September 2020 to June 2021), the CCC demonstrated a downward trend, decreasing from approximately 29.38 days to a low of 16.46 days in June 2021. This suggests that the company was effectively managing its receivables and payables, resulting in shorter cycles and improved cash flow efficiency.

However, starting from September 2021, the CCC exhibited relative stability around the mid-20s days, oscillating between approximately 24 and 30 days until the end of 2022. This phase indicates consistent operational efficiency and balanced working capital management.

A significant change occurred in June 2023, when the CCC sharply increased to approximately 49.34 days. This elongation implies a substantial deterioration in cash flow efficiency, possibly due to longer receivables collection periods, delays in payables, or a combination thereof. Such an expansion could exert pressure on liquidity and working capital resources.

Following this peak, the CCC partially contracted in the subsequent quarters, decreasing to around 31.78 days by December 2024. This gradual reduction indicates efforts to restore operational efficiency, although the cycle remained somewhat elevated compared to earlier periods.

Throughout the period, the CCC fluctuated within a range generally from about 16 to 49 days, with the most extended period observed in mid-2023. The overall trend underscores periods of operational improvement interspersed with phases of increased cycle length. Continuous monitoring of factors influencing receivables, payables, and inventory management will be essential to understand ongoing liquidity and operational efficiency dynamics.