ZoomInfo Technologies Inc (ZI)

Cash conversion cycle

		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
Days of inventory on hand (DOH)	days	—	—	—	—	—	—	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	84.41	70.32	68.41	73.52	79.40	64.33	69.95	80.15	100.70	70.58	74.64	92.73
Number of days of payables	days	16.25	9.02	10.41	11.95	17.43	12.21	11.71	11.52	11.44	20.67	19.28	12.51
Cash conversion cycle	days	68.16	61.30	58.00	61.57	61.97	52.12	58.24	68.64	89.25	49.91	55.35	80.21

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 84.41 – 16.25
= 68.16

The cash conversion cycle for ZoomInfo Technologies Inc. fluctuated significantly over the past eight quarters. In Q4 2023, the company's cash conversion cycle was negative, indicating that it was able to convert its inventory and accounts receivable into cash quickly. This was a notable improvement from the previous quarter, where the cash conversion cycle was positive at 14.91 days.

Comparing year-over-year performance, there was a significant improvement in the cash conversion cycle from Q4 2022 to Q4 2023, where the cycle moved from negative 16.72 days to negative 9.29 days. This positive trend suggests that ZoomInfo Technologies Inc. has been managing its inventory and receivables more efficiently.

It is worth noting that the cash conversion cycle in Q3 2022 was also negative, indicating a strong performance in converting assets into cash. However, the cycle increased in Q1 2022, reaching its peak at 18.96 days.

Overall, fluctuations in the cash conversion cycle demonstrate the company's ability to manage its working capital effectively. A shorter cash conversion cycle indicates quicker cash generation, which is generally considered a positive sign for the company's financial health and operational efficiency.