Ultra Clean Holdings Inc (UCTT)

Days of sales outstanding (DSO)

		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
Receivables turnover		9.59	10.89	11.51	11.79	9.36	10.27	—	—	8.40	7.98	7.92	8.90	9.61	9.04	8.69	9.96	9.46	9.40	—	9.39
DSO	days	38.05	33.53	31.70	30.96	39.00	35.55	—	—	43.44	45.72	46.10	41.01	37.97	40.37	42.02	36.66	38.58	38.85	—	38.88

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 9.59
= 38.05

Ultra Clean Holdings Inc's Days Sales Outstanding (DSO) measures the average number of days it takes for the company to collect its accounts receivable. A lower DSO indicates that the company is collecting its receivables more quickly, which is generally seen as positive for cash flow and liquidity.

Analyzing the DSO trend for Ultra Clean Holdings Inc over the past few quarters, we observe a decreasing trend from 39.00 days in Dec 2022 to 30.96 days in Mar 2023. This indicates an improvement in the efficiency of the company in collecting its outstanding receivables. The subsequent slight increase to 31.70 days in Jun 2023 needs to be monitored to ensure it does not reverse the positive trend seen earlier.

Looking at historical data, DSO has ranged between 30.96 days to 46.10 days over the past few quarters. It is noteworthy that the DSO has been well below 45 days in recent quarters, suggesting that Ultra Clean Holdings Inc has been effective in managing its accounts receivable and converting them into cash.

Overall, the decreasing trend in DSO indicates that Ultra Clean Holdings Inc has been successful in managing its accounts receivable efficiently and collecting cash from its customers in a timely manner. This is a positive sign for the company's liquidity and working capital management.