Wolfspeed Inc (WOLF)

Days of sales outstanding (DSO)

		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	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019
Receivables turnover		4.07	4.66	4.85	4.39	5.09	4.88	4.68	4.79	2.41	4.67	4.69	4.61	5.27	6.72	7.83	7.19	7.43	5.64	7.24	8.47
DSO	days	89.76	78.38	75.20	83.12	71.64	74.74	77.95	76.13	151.29	78.19	77.83	79.13	69.20	54.35	46.64	50.76	49.12	64.77	50.44	43.08

June 30, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 4.07
= 89.76

The Days Sales Outstanding (DSO) ratio for Wolfspeed Inc has shown fluctuating trends over the past several quarters. DSO measures the average number of days it takes for a company to collect revenue after a sale has been made. A lower DSO indicates that the company is able to collect its accounts receivable more quickly, which is generally seen as positive as it indicates a strong cash collection process.

Looking at the data provided, we can see that Wolfspeed Inc experienced a significant increase in DSO in the fourth quarter of 2021, with a DSO of 151.29 days. This suggests that the company took much longer to collect its accounts receivable during that period, which could indicate issues with the company's credit policies, collection efforts, or the quality of its customers.

Subsequently, there was a notable improvement in DSO in the first quarter of 2022, with the ratio dropping to 77.83 days. This improvement continued in the second quarter of 2022, with a DSO of 78.19 days. However, there was a slight increase in the third quarter of 2022 to 76.13 days.

In the most recent quarter, Jun 30, 2024, the DSO stood at 89.76 days, which indicates a slight decline in efficiency in collecting accounts receivable compared to the previous quarter. It is essential for Wolfspeed Inc to closely monitor its DSO ratio to ensure efficient management of accounts receivable and maintain healthy cash flows.

Overall, while there have been fluctuations in Wolfspeed Inc's DSO ratio over the analyzed periods, the company should focus on strategies to reduce DSO to ensure timely collection of accounts receivable and improve its overall working capital management.