Western Digital Corporation (WDC)

Cash conversion cycle

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Days of inventory on hand (DOH)	days	80.85	121.28	129.40	102.78	106.43
Days of sales outstanding (DSO)	days	70.55	60.80	47.35	54.46	48.68
Number of days of payables	days	79.29	62.56	55.46	62.78	68.64
Cash conversion cycle	days	72.11	119.52	121.29	94.47	86.47

June 30, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 80.85 + 70.55 – 79.29
= 72.11

The cash conversion cycle (CCC) of Western Digital Corporation has exhibited notable fluctuations over the specified period from June 30, 2021, to June 30, 2025.

As of June 30, 2021, the CCC stood at approximately 86.47 days. This metric increased significantly during the subsequent year, reaching approximately 94.47 days by June 30, 2022. The upward trend continued into June 30, 2023, with the CCC escalating further to approximately 121.29 days. This indicates a period of growing operational and liquidity management challenges, suggesting that the company's cash conversion efficiency was declining, possibly due to extended inventory turnover, longer receivables collection period, or delayed payables.

By June 30, 2024, the CCC slightly decreased to roughly 119.52 days. Although this reflects a marginal improvement, the level remained substantially higher than the values recorded in 2021 and 2022, highlighting persistent issues in cash flow management or working capital cycles.

A significant positive shift is observed approaching the most recent period, with the CCC declining sharply to approximately 72.11 days by June 30, 2025. This reduction suggests an improved ability to convert investments in inventory and receivables into cash more rapidly, possibly attributable to enhanced operational efficiency, supply chain optimization, or better receivables management.

Overall, the trend indicates a period of expansion and contraction in the company's cash conversion cycle, with notable peaks in 2023 followed by a substantial reduction in 2025. This progression reflects factors influencing inventory management, receivables collection, and payables periods, which are critical components affecting the company's liquidity and operational flexibility over the analyzed timeframe.