XPO Logistics Inc (XPO)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		7.96	8.09	3.42	2.14	4.27
DSO	days	45.86	45.12	106.68	170.78	85.43

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.96
= 45.86

XPO Inc's Days Sales Outstanding (DSO) has exhibited fluctuations over the past five years. The DSO figure was 45.86 days as of December 31, 2023, showing a marginal increase from 45.12 days in the previous year. This indicates that, on average, XPO Inc takes approximately 45.86 days to collect its accounts receivable balance.

Compared to the DSO of 60.00 days in 2021 and 64.82 days in 2020, the current DSO of 45.86 days reflects an improvement in the efficiency of the company's account receivable collection process. Lower DSO signifies that XPO Inc is collecting payments from its customers at a faster rate, which can improve its overall cash flow and liquidity position.

In contrast, the DSO was lower at 54.81 days in 2019 compared to the current year, indicating that XPO Inc's collection period has increased over the years. It is essential for the company to closely monitor its DSO trend and strive to consistently improve its account receivable collection efficiency to optimize working capital management.

Overall, a decreasing trend in DSO suggests that XPO Inc is effectively managing its accounts receivable and capturing revenues efficiently. This metric is critical for assessing the company's financial health and operational effectiveness in managing its receivables turnover cycle.