Analysis of Short-term (Operating) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Short-term Activity Ratios (Summary)
Cadence Design Systems Inc., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Cadence Design Systems Inc. inventory turnover ratio deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Cadence Design Systems Inc. receivables turnover ratio improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Cadence Design Systems Inc. payables turnover ratio decreased from 2022 to 2023 but then increased from 2023 to 2024 exceeding 2022 level. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Cadence Design Systems Inc. working capital turnover ratio improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. | Cadence Design Systems Inc. number of days of inventory outstanding deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024. |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Cadence Design Systems Inc. number of days of receivables outstanding improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Cadence Design Systems Inc. operating cycle deteriorated from 2022 to 2023 and from 2023 to 2024. |
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | Cadence Design Systems Inc. number of days of payables outstanding increased from 2022 to 2023 but then decreased significantly from 2023 to 2024. |
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. | Cadence Design Systems Inc. cash conversion cycle improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
Inventory Turnover
Cadence Design Systems Inc., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of revenue | 647,502) | 435,041) | 371,623) | 307,006) | 305,498) | |
| Inventories | 257,711) | 181,661) | 128,005) | 115,721) | 75,956) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 2.51 | 2.39 | 2.90 | 2.65 | 4.02 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| International Business Machines Corp. | 21.10 | 23.74 | 17.94 | 15.68 | 20.69 | |
| Microsoft Corp. | 59.48 | 26.35 | 16.74 | 19.81 | 24.32 | |
| Oracle Corp. | 45.34 | 45.52 | 28.27 | 55.32 | 37.62 | |
| Synopsys Inc. | 3.44 | 3.75 | 5.02 | 3.76 | 4.13 | |
| Inventory Turnover, Sector | ||||||
| Software & Services | 52.71 | 38.61 | 26.87 | 28.22 | 31.90 | |
| Inventory Turnover, Industry | ||||||
| Information Technology | 7.86 | 8.01 | 8.61 | 10.44 | 11.17 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Inventory turnover = Cost of revenue ÷ Inventories
= 647,502 ÷ 257,711 = 2.51
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Cadence Design Systems Inc. inventory turnover ratio deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024. |
Receivables Turnover
Cadence Design Systems Inc., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | 4,641,264) | 4,089,986) | 3,561,718) | 2,988,244) | 2,682,891) | |
| Receivables, net | 680,460) | 489,224) | 486,710) | 337,596) | 338,487) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 6.82 | 8.36 | 7.32 | 8.85 | 7.93 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Accenture PLC | 5.47 | 6.00 | 5.87 | 5.74 | 6.16 | |
| Adobe Inc. | 10.38 | 8.73 | 8.53 | 8.41 | 9.20 | |
| CrowdStrike Holdings Inc. | 3.58 | 3.58 | 3.94 | 3.66 | 2.92 | |
| International Business Machines Corp. | 9.22 | 8.57 | 9.25 | 8.49 | 10.32 | |
| Intuit Inc. | 35.63 | 35.48 | 28.53 | 24.64 | 51.54 | |
| Microsoft Corp. | 4.31 | 4.35 | 4.48 | 4.42 | 4.47 | |
| Oracle Corp. | 6.73 | 7.22 | 7.13 | 7.48 | 7.04 | |
| Palantir Technologies Inc. | 4.98 | 6.10 | 7.38 | 8.08 | 6.96 | |
| Palo Alto Networks Inc. | 3.07 | 2.80 | 2.57 | 3.43 | 3.29 | |
| Salesforce Inc. | 3.05 | 2.92 | 2.72 | 2.73 | 2.77 | |
| ServiceNow Inc. | 4.90 | 4.41 | 4.20 | 4.24 | 4.48 | |
| Synopsys Inc. | 6.56 | 6.17 | 6.38 | 7.40 | 4.72 | |
| Workday Inc. | 4.43 | 3.96 | 4.14 | 4.18 | 4.13 | |
| Receivables Turnover, Sector | ||||||
| Software & Services | 5.06 | 5.13 | 5.20 | 5.23 | 5.58 | |
| Receivables Turnover, Industry | ||||||
| Information Technology | 6.98 | 7.46 | 7.43 | 7.53 | 7.92 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Receivables turnover = Revenue ÷ Receivables, net
= 4,641,264 ÷ 680,460 = 6.82
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Cadence Design Systems Inc. receivables turnover ratio improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
Payables Turnover
Cadence Design Systems Inc., payables turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of revenue | 647,502) | 435,041) | 371,623) | 307,006) | 305,498) | |
| Trade accounts payable | 5,555) | 91,194) | 47,113) | —) | —) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 116.56 | 4.77 | 7.89 | — | — | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Accenture PLC | 15.94 | 17.41 | 16.37 | 15.03 | 22.48 | |
| Adobe Inc. | 6.53 | 7.50 | 5.71 | 5.98 | 5.63 | |
| CrowdStrike Holdings Inc. | 26.82 | 13.25 | 8.05 | 19.03 | 105.30 | |
| International Business Machines Corp. | 6.75 | 6.67 | 6.87 | 6.54 | 7.75 | |
| Intuit Inc. | 4.81 | 4.93 | 3.26 | 2.70 | 4.52 | |
| Microsoft Corp. | 3.37 | 3.64 | 3.30 | 3.44 | 3.68 | |
| Oracle Corp. | 6.42 | 11.27 | 6.74 | 10.54 | 12.46 | |
| Palantir Technologies Inc. | 5,495.05 | 35.56 | 9.12 | 4.53 | 21.55 | |
| Palo Alto Networks Inc. | 17.71 | 14.43 | 13.43 | 22.41 | 15.72 | |
| Salesforce Inc. | — | — | — | — | — | |
| ServiceNow Inc. | 33.63 | 15.25 | 5.74 | 15.20 | 28.83 | |
| Synopsys Inc. | 6.01 | 7.84 | 28.30 | 31.44 | 26.49 | |
| Workday Inc. | 22.71 | 11.16 | 25.74 | 15.85 | 18.51 | |
| Payables Turnover, Sector | ||||||
| Software & Services | 5.62 | 6.25 | 5.57 | 5.75 | 6.64 | |
| Payables Turnover, Industry | ||||||
| Information Technology | 4.27 | 4.79 | 4.25 | 4.63 | 4.91 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Payables turnover = Cost of revenue ÷ Trade accounts payable
= 647,502 ÷ 5,555 = 116.56
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Cadence Design Systems Inc. payables turnover ratio decreased from 2022 to 2023 but then increased from 2023 to 2024 exceeding 2022 level. |
Working Capital Turnover
Cadence Design Systems Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Current assets | 4,016,079) | 1,976,217) | 1,706,767) | 1,715,769) | 1,478,587) | |
| Less: Current liabilities | 1,370,105) | 1,590,867) | 1,347,696) | 971,225) | 796,808) | |
| Working capital | 2,645,974) | 385,350) | 359,071) | 744,544) | 681,779) | |
| Revenue | 4,641,264) | 4,089,986) | 3,561,718) | 2,988,244) | 2,682,891) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 1.75 | 10.61 | 9.92 | 4.01 | 3.94 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Accenture PLC | 34.49 | 11.93 | 15.07 | 12.77 | 8.71 | |
| Adobe Inc. | 30.25 | 6.85 | 20.28 | 9.09 | 4.89 | |
| CrowdStrike Holdings Inc. | 1.48 | 1.46 | 1.25 | 0.61 | 0.71 | |
| International Business Machines Corp. | 46.83 | — | — | — | — | |
| Intuit Inc. | 7.45 | 8.13 | 8.98 | 3.85 | 1.73 | |
| Microsoft Corp. | 7.12 | 2.65 | 2.66 | 1.76 | 1.30 | |
| Oracle Corp. | — | — | 3.50 | 1.29 | 1.12 | |
| Palantir Technologies Inc. | 0.58 | 0.66 | 0.78 | 0.70 | 0.66 | |
| Palo Alto Networks Inc. | — | — | — | — | 1.40 | |
| Salesforce Inc. | 14.27 | 62.21 | 24.95 | 5.11 | 15.29 | |
| ServiceNow Inc. | 13.25 | 21.77 | 11.16 | 21.76 | 5.76 | |
| Synopsys Inc. | 1.60 | 13.12 | 21.34 | 10.65 | 9.00 | |
| Workday Inc. | 1.49 | 1.79 | 35.15 | 8.31 | 28.97 | |
| Working Capital Turnover, Sector | ||||||
| Software & Services | 10.34 | 5.14 | 4.74 | 2.76 | 2.18 | |
| Working Capital Turnover, Industry | ||||||
| Information Technology | 8.94 | 5.77 | 6.47 | 4.33 | 3.30 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Working capital turnover = Revenue ÷ Working capital
= 4,641,264 ÷ 2,645,974 = 1.75
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Cadence Design Systems Inc. working capital turnover ratio improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
Average Inventory Processing Period
Cadence Design Systems Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 2.51 | 2.39 | 2.90 | 2.65 | 4.02 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 145 | 152 | 126 | 138 | 91 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| International Business Machines Corp. | 17 | 15 | 20 | 23 | 18 | |
| Microsoft Corp. | 6 | 14 | 22 | 18 | 15 | |
| Oracle Corp. | 8 | 8 | 13 | 7 | 10 | |
| Synopsys Inc. | 106 | 97 | 73 | 97 | 88 | |
| Average Inventory Processing Period, Sector | ||||||
| Software & Services | 7 | 9 | 14 | 13 | 11 | |
| Average Inventory Processing Period, Industry | ||||||
| Information Technology | 46 | 46 | 42 | 35 | 33 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 2.51 = 145
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. | Cadence Design Systems Inc. number of days of inventory outstanding deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024. |
Average Receivable Collection Period
Cadence Design Systems Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 6.82 | 8.36 | 7.32 | 8.85 | 7.93 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 54 | 44 | 50 | 41 | 46 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Accenture PLC | 67 | 61 | 62 | 64 | 59 | |
| Adobe Inc. | 35 | 42 | 43 | 43 | 40 | |
| CrowdStrike Holdings Inc. | 102 | 102 | 93 | 100 | 125 | |
| International Business Machines Corp. | 40 | 43 | 39 | 43 | 35 | |
| Intuit Inc. | 10 | 10 | 13 | 15 | 7 | |
| Microsoft Corp. | 85 | 84 | 81 | 83 | 82 | |
| Oracle Corp. | 54 | 51 | 51 | 49 | 52 | |
| Palantir Technologies Inc. | 73 | 60 | 49 | 45 | 52 | |
| Palo Alto Networks Inc. | 119 | 130 | 142 | 106 | 111 | |
| Salesforce Inc. | 120 | 125 | 134 | 134 | 132 | |
| ServiceNow Inc. | 74 | 83 | 87 | 86 | 82 | |
| Synopsys Inc. | 56 | 59 | 57 | 49 | 77 | |
| Workday Inc. | 82 | 92 | 88 | 87 | 88 | |
| Average Receivable Collection Period, Sector | ||||||
| Software & Services | 72 | 71 | 70 | 70 | 65 | |
| Average Receivable Collection Period, Industry | ||||||
| Information Technology | 52 | 49 | 49 | 48 | 46 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 6.82 = 54
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Cadence Design Systems Inc. number of days of receivables outstanding improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |
Operating Cycle
Cadence Design Systems Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 145 | 152 | 126 | 138 | 91 | |
| Average receivable collection period | 54 | 44 | 50 | 41 | 46 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 199 | 196 | 176 | 179 | 137 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| International Business Machines Corp. | 57 | 58 | 59 | 66 | 53 | |
| Microsoft Corp. | 91 | 98 | 103 | 101 | 97 | |
| Oracle Corp. | 62 | 59 | 64 | 56 | 62 | |
| Synopsys Inc. | 162 | 156 | 130 | 146 | 165 | |
| Operating Cycle, Sector | ||||||
| Software & Services | 79 | 80 | 84 | 83 | 76 | |
| Operating Cycle, Industry | ||||||
| Information Technology | 98 | 95 | 91 | 83 | 79 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 145 + 54 = 199
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Cadence Design Systems Inc. operating cycle deteriorated from 2022 to 2023 and from 2023 to 2024. |
Average Payables Payment Period
Cadence Design Systems Inc., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 116.56 | 4.77 | 7.89 | — | — | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 3 | 77 | 46 | — | — | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Accenture PLC | 23 | 21 | 22 | 24 | 16 | |
| Adobe Inc. | 56 | 49 | 64 | 61 | 65 | |
| CrowdStrike Holdings Inc. | 14 | 28 | 45 | 19 | 3 | |
| International Business Machines Corp. | 54 | 55 | 53 | 56 | 47 | |
| Intuit Inc. | 76 | 74 | 112 | 135 | 81 | |
| Microsoft Corp. | 108 | 100 | 111 | 106 | 99 | |
| Oracle Corp. | 57 | 32 | 54 | 35 | 29 | |
| Palantir Technologies Inc. | 0 | 10 | 40 | 81 | 17 | |
| Palo Alto Networks Inc. | 21 | 25 | 27 | 16 | 23 | |
| Salesforce Inc. | — | — | — | — | — | |
| ServiceNow Inc. | 11 | 24 | 64 | 24 | 13 | |
| Synopsys Inc. | 61 | 47 | 13 | 12 | 14 | |
| Workday Inc. | 16 | 33 | 14 | 23 | 20 | |
| Average Payables Payment Period, Sector | ||||||
| Software & Services | 65 | 58 | 66 | 63 | 55 | |
| Average Payables Payment Period, Industry | ||||||
| Information Technology | 85 | 76 | 86 | 79 | 74 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 116.56 = 3
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | Cadence Design Systems Inc. number of days of payables outstanding increased from 2022 to 2023 but then decreased significantly from 2023 to 2024. |
Cash Conversion Cycle
Cadence Design Systems Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 145 | 152 | 126 | 138 | 91 | |
| Average receivable collection period | 54 | 44 | 50 | 41 | 46 | |
| Average payables payment period | 3 | 77 | 46 | — | — | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 196 | 119 | 130 | — | — | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| International Business Machines Corp. | 3 | 3 | 6 | 10 | 6 | |
| Microsoft Corp. | -17 | -2 | -8 | -5 | -2 | |
| Oracle Corp. | 5 | 27 | 10 | 21 | 33 | |
| Synopsys Inc. | 101 | 109 | 117 | 134 | 151 | |
| Cash Conversion Cycle, Sector | ||||||
| Software & Services | 14 | 22 | 18 | 20 | 21 | |
| Cash Conversion Cycle, Industry | ||||||
| Information Technology | 13 | 19 | 5 | 4 | 5 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 145 + 54 – 3 = 196
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. | Cadence Design Systems Inc. cash conversion cycle improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024. |