Stock Analysis on Net

Cadence Design Systems Inc. (NASDAQ:CDNS)

Analysis of Short-term (Operating) Activity Ratios
Quarterly Data

Microsoft Excel

Short-term Activity Ratios (Summary)

Cadence Design Systems Inc., short-term (operating) activity ratios (quarterly data)

Microsoft Excel
Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Oct 1, 2022 Jul 2, 2022 Apr 2, 2022 Dec 31, 2021 Oct 2, 2021 Jul 3, 2021 Apr 3, 2021 Dec 31, 2020 Sep 26, 2020 Jun 27, 2020 Mar 28, 2020
Turnover Ratios
Inventory turnover 3.06 2.51 1.81 2.79 2.35 2.39 2.59 2.88 3.12 2.90 3.04 3.17 2.91 2.65 3.06 3.50 4.11 4.02
Receivables turnover 8.39 6.82 7.76 7.37 10.46 8.36 9.19 8.62 7.54 7.32 8.78 8.38 8.72 8.85 9.09 7.41 7.21 7.93
Working capital turnover 1.81 1.75 1.80 6.28 8.78 10.61 7.00 8.51 7.12 9.92 8.31 5.34 4.07 4.01 4.68 5.45 5.03 3.94
Average No. Days
Average inventory processing period 119 145 201 131 156 152 141 127 117 126 120 115 125 138 119 104 89 91
Add: Average receivable collection period 43 54 47 50 35 44 40 42 48 50 42 44 42 41 40 49 51 46
Operating cycle 162 199 248 181 191 196 181 169 165 176 162 159 167 179 159 153 140 137

Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-10-01), 10-Q (reporting date: 2022-07-02), 10-Q (reporting date: 2022-04-02), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-10-02), 10-Q (reporting date: 2021-07-03), 10-Q (reporting date: 2021-04-03), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-26), 10-Q (reporting date: 2020-06-27), 10-Q (reporting date: 2020-03-28).


Inventory Turnover
The inventory turnover ratio shows a general downward trend over the observed periods. Starting from 4.02, it declines progressively to a low near 1.81 before rising again to 3.06 by the end of the timeline. This suggests that the company’s inventory is being converted to sales more slowly over time, with some improvement occurring towards the end.
Receivables Turnover
The receivables turnover ratio fluctuates throughout the periods, without a clear upward or downward trend. Initial values around 7.93 decrease and then increase intermittently, peaking around 10.46 before declining again towards 6.82 and ending at 8.39. This indicates variability in the efficiency of collecting receivables over the quarters.
Working Capital Turnover
The working capital turnover ratio demonstrates significant variability. It starts at 3.94, rises to a peak of 10.61, and then drops sharply to values near 1.75 towards the latter periods. This volatility may reflect fluctuations in the company’s operational efficiency or changes in working capital management.
Average Inventory Processing Period
The average inventory processing period gradually increases from 91 days to a peak of 201 days before declining again to 119 days. The lengthening period suggests slower inventory movement during the middle periods, indicating potential issues with inventory management or changes in demand, with some recovery in later periods.
Average Receivable Collection Period
The receivable collection period varies between 35 and 54 days without a definitive trend, showing alternating shorter and longer collection times. This indicates some inconsistency in the efficiency of accounts receivable collections, possibly influenced by customer payment behaviors or credit policies.
Operating Cycle
The operating cycle lengthens from 137 days to a high of 248 days before decreasing again to 162 days. This overall increase signals a longer duration between inventory purchase and cash collection, potentially impacting liquidity and cash flow. The later decline suggests some improvement in operational timing.

Turnover Ratios


Average No. Days


Inventory Turnover

Cadence Design Systems Inc., inventory turnover calculation (quarterly data)

Microsoft Excel
Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Oct 1, 2022 Jul 2, 2022 Apr 2, 2022 Dec 31, 2021 Oct 2, 2021 Jul 3, 2021 Apr 3, 2021 Dec 31, 2020 Sep 26, 2020 Jun 27, 2020 Mar 28, 2020
Selected Financial Data (US$ in thousands)
Cost of revenue 167,133 219,991 163,044 139,270 125,197 104,130 109,581 96,858 124,472 93,515 87,600 92,665 97,843 69,693 76,587 76,759 83,967 73,536 82,284 75,215 74,463
Inventories 225,621 257,711 293,350 171,508 185,784 181,661 163,693 139,576 127,566 128,005 114,283 106,372 110,213 115,721 101,575 90,479 76,592 75,956 47,979 43,924 60,575
Short-term Activity Ratio
Inventory turnover1 3.06 2.51 1.81 2.79 2.35 2.39 2.59 2.88 3.12 2.90 3.04 3.17 2.91 2.65 3.06 3.50 4.11 4.02
Benchmarks
Inventory Turnover, Competitors2
International Business Machines Corp. 18.86 21.10 19.90 22.19 22.72 23.74 19.66 18.29 17.30 17.94 15.59 16.30 14.96 15.68 15.08 17.43 18.90 20.69
Microsoft Corp. 47.92 59.48 54.62 42.63 22.24 26.35 22.77 21.81 15.10 16.74 18.27 19.09 16.09 19.81 22.53 25.21 17.25 24.32 26.86 23.78 16.56
Synopsys Inc. 2.98 3.44 3.12 3.23 3.18 3.75 4.15 4.43 4.94 5.02 4.62 4.45 4.28 3.76 3.53 3.65 3.51 4.13 4.71 4.49 5.09

Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-10-01), 10-Q (reporting date: 2022-07-02), 10-Q (reporting date: 2022-04-02), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-10-02), 10-Q (reporting date: 2021-07-03), 10-Q (reporting date: 2021-04-03), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-26), 10-Q (reporting date: 2020-06-27), 10-Q (reporting date: 2020-03-28).

1 Q1 2025 Calculation
Inventory turnover = (Cost of revenueQ1 2025 + Cost of revenueQ4 2024 + Cost of revenueQ3 2024 + Cost of revenueQ2 2024) ÷ Inventories
= (167,133 + 219,991 + 163,044 + 139,270) ÷ 225,621 = 3.06

2 Click competitor name to see calculations.


Cost of Revenue
The cost of revenue shows a fluctuating yet generally increasing trend over the observed periods. Initially, from March 2020 to December 2020, costs experienced moderate variation with values ranging roughly between 73,500 and 82,200 thousand USD. Starting from early 2021, the figures exhibit some volatility but with an upwards tendency, peaking significantly in March 2024 at approximately 219,991 thousand USD. Thereafter, a notable reduction occurs by March 2025, declining to 167,133 thousand USD. This pattern indicates heightened costs in recent quarters, potentially reflecting expansion, increased production expenses, or supply chain variations.
Inventories
Inventories have steadily increased over the time span covered. From an initial figure around 60,575 thousand USD in March 2020, inventory values generally rose, showing some short-term decreases but maintaining an upward trajectory overall. The most remarkable increases occurred between late 2022 and early 2024, reaching a maximum of approximately 293,350 thousand USD by September 2024. A subsequent decrease is observed by March 2025, lowering inventories to about 225,621 thousand USD. This escalation could reflect stockpiling, increased production input, or anticipation of future demand, while recent declines may indicate inventory optimization or changes in sales.
Inventory Turnover Ratio
The inventory turnover ratio fluctuates considerably, with available data starting from December 2020. Initially, the ratio remained above 3.0, indicating relatively efficient inventory management. However, from early 2021 onward, a downward trend is evident, with the ratio declining to a low of approximately 1.81 by September 2024. Following this low point, a recovery occurs, increasing again to around 3.06 by March 2025. These shifts suggest periods of slower inventory movement or accumulation followed by improved asset utilization and sales efficacy towards the end of the period examined.

Receivables Turnover

Cadence Design Systems Inc., receivables turnover calculation (quarterly data)

Microsoft Excel
Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Oct 1, 2022 Jul 2, 2022 Apr 2, 2022 Dec 31, 2021 Oct 2, 2021 Jul 3, 2021 Apr 3, 2021 Dec 31, 2020 Sep 26, 2020 Jun 27, 2020 Mar 28, 2020
Selected Financial Data (US$ in thousands)
Revenue 1,242,366 1,355,981 1,215,499 1,060,681 1,009,103 1,068,623 1,023,094 976,579 1,021,690 899,877 902,554 857,521 901,766 773,036 750,895 728,285 736,028 759,909 666,607 638,418 617,957
Receivables, net 580,887 680,460 560,973 564,851 389,865 489,224 426,505 440,915 488,237 486,710 391,181 391,738 361,789 337,596 327,191 389,986 388,666 338,487 300,413 312,758 284,093
Short-term Activity Ratio
Receivables turnover1 8.39 6.82 7.76 7.37 10.46 8.36 9.19 8.62 7.54 7.32 8.78 8.38 8.72 8.85 9.09 7.41 7.21 7.93
Benchmarks
Receivables Turnover, Competitors2
Adobe Inc. 11.17 10.38 11.62 12.67 9.69 8.73 10.20 10.94 9.99 8.53 9.98 10.51 9.58 8.41 9.77 9.74 9.00 9.20 9.44 8.82 8.40
CrowdStrike Holdings Inc. 4.67 3.58 5.07 4.90 5.30 3.58 4.19 4.38 4.43 3.94 4.54 4.27 4.73 3.66 4.41 4.38 3.91 2.92
Fair Isaac Corp. 5.06 4.03 3.78 3.42 4.22 3.90 3.83 4.21 4.54 4.27 4.76 4.95 5.10 4.22 4.83 5.03 4.21 3.87 4.04 3.99 4.25
International Business Machines Corp. 10.73 9.22 11.61 10.81 10.27 8.57 11.48 10.67 10.52 9.25 10.95 10.17 9.79 8.49 9.23 9.57 10.72 10.32
Intuit Inc. 38.94 35.63 20.02 16.27 39.65 35.48 19.62 15.15 34.68 28.53 17.44 12.84 25.10 24.64 16.04 16.60 79.16 51.54 31.31 11.82 66.66
Microsoft Corp. 5.76 4.31 5.37 5.31 5.91 4.35 5.55 5.70 6.49 4.48 5.90 5.52 6.44 4.42 6.08 5.61 6.44 4.47 6.11 5.71 6.80
Oracle Corp. 6.71 6.73 7.20 7.59 7.82 7.22 7.72 7.43 7.44 7.13 9.12 9.28 9.11 7.48 8.56 8.91 8.57 7.04
Palantir Technologies Inc. 4.30 4.98 3.96 3.76 4.79 6.10 4.94 5.44 7.81 7.38 5.33 6.56 6.42 8.08
Palo Alto Networks Inc. 7.32 3.07 4.54 3.97 5.10 2.80 4.50 4.82 4.70 2.57 4.17 5.10 5.61 3.43 5.20 5.65 5.30 3.29 4.88 5.78 6.04
Salesforce Inc. 8.36 3.05 7.00 6.12 6.95 2.92 7.09 6.18 7.07 2.72 6.22 5.78 7.04 2.73 6.12 5.63 5.93 2.77
ServiceNow Inc. 8.44 4.90 8.00 6.56 7.26 4.41 7.26 7.33 6.87 4.20 7.71 7.74 7.59 4.24 7.13 6.62 7.49 4.48
Synopsys Inc. 6.80 6.56 7.56 7.25 5.63 6.17 8.29 6.78 5.00 6.38 7.25 6.58 4.34 7.40 7.06 6.51 4.84 4.72 5.50 5.36 4.22
Workday Inc. 6.68 4.43 5.70 5.28 5.94 3.96 5.71 5.13 6.94 4.14 5.66 5.35 6.91 4.18 5.60 5.75 6.54 4.13

Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-10-01), 10-Q (reporting date: 2022-07-02), 10-Q (reporting date: 2022-04-02), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-10-02), 10-Q (reporting date: 2021-07-03), 10-Q (reporting date: 2021-04-03), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-26), 10-Q (reporting date: 2020-06-27), 10-Q (reporting date: 2020-03-28).

1 Q1 2025 Calculation
Receivables turnover = (RevenueQ1 2025 + RevenueQ4 2024 + RevenueQ3 2024 + RevenueQ2 2024) ÷ Receivables, net
= (1,242,366 + 1,355,981 + 1,215,499 + 1,060,681) ÷ 580,887 = 8.39

2 Click competitor name to see calculations.


The revenue of the company demonstrates a generally upward trend over the entire period analyzed, with periodic fluctuations. Starting at approximately $618 million in the first quarter of 2020, revenue increased steadily and reached peaks above $1 billion in several later quarters, particularly notable in March 2023, September 2024, and December 2024. Some quarters show slight declines or plateaus, such as mid-2022 and mid-2023, but the overall direction is positive, indicating growth in sales or service income.

Net receivables display a more volatile pattern over the same timeframe. Initial values hovered around $284 million in early 2020 and generally increased, reaching values above $680 million in late 2024. This trend points toward an increasing outstanding balance owed to the company, possibly due to extended credit terms or slower collection cycles. There are notable spikes in receivables, for example at the end of 2022 and mid to late 2024, which may warrant further scrutiny regarding credit management or customer payment behavior.

The receivables turnover ratio, calculated as the number of times receivables are collected within a period, fluctuates significantly throughout the analyzed quarters. The ratio values range approximately from 6.82 to 10.46. Higher turnover ratios are observed sporadically, such as in December 2020, December 2021, September 2023, and June 2024, indicating efficient collection processes during these times. Conversely, lower turnover values are recorded in quarters like March 2022, September 2024, and December 2024, suggesting slower collections. This variability suggests inconsistency in the company's ability to convert receivables to cash promptly over the periods analyzed.

In summary, the company shows robust revenue growth with some cyclical variability, increasing net receivables which may indicate changes in credit policies or customer payment patterns, and a fluctuating receivables turnover ratio that points to varying efficiency in cash collection practices. These insights collectively suggest areas for potential operational focus, notably in managing accounts receivable to maintain or improve liquidity alongside revenue expansion.


Working Capital Turnover

Cadence Design Systems Inc., working capital turnover calculation (quarterly data)

Microsoft Excel
Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Oct 1, 2022 Jul 2, 2022 Apr 2, 2022 Dec 31, 2021 Oct 2, 2021 Jul 3, 2021 Apr 3, 2021 Dec 31, 2020 Sep 26, 2020 Jun 27, 2020 Mar 28, 2020
Selected Financial Data (US$ in thousands)
Current assets 3,998,087 4,016,079 4,099,923 2,196,388 1,929,932 1,976,217 1,824,463 1,643,050 1,698,544 1,706,767 1,670,483 1,657,620 1,734,897 1,715,769 1,543,013 1,457,067 1,349,729 1,478,587 1,736,482 1,639,783 1,399,507
Less: Current liabilities 1,300,767 1,370,105 1,674,994 1,533,722 1,465,743 1,590,867 1,264,167 1,196,300 1,181,381 1,347,696 1,256,994 1,042,491 960,826 971,225 907,196 926,716 792,341 796,808 1,117,889 1,151,887 1,012,429
Working capital 2,697,320 2,645,974 2,424,929 662,666 464,189 385,350 560,296 446,750 517,163 359,071 413,489 615,129 774,071 744,544 635,817 530,351 557,388 681,779 618,593 487,896 387,078
 
Revenue 1,242,366 1,355,981 1,215,499 1,060,681 1,009,103 1,068,623 1,023,094 976,579 1,021,690 899,877 902,554 857,521 901,766 773,036 750,895 728,285 736,028 759,909 666,607 638,418 617,957
Short-term Activity Ratio
Working capital turnover1 1.81 1.75 1.80 6.28 8.78 10.61 7.00 8.51 7.12 9.92 8.31 5.34 4.07 4.01 4.68 5.45 5.03 3.94
Benchmarks
Working Capital Turnover, Competitors2
Accenture PLC 8.28 34.49 22.48 15.40 11.18 11.93 10.11 13.40 14.81 15.07 13.41 15.55 15.85 12.77 7.71 8.35 7.70 8.71 10.32 10.56 9.98
Adobe Inc. 13.02 30.25 19.54 13.19 42.33 6.85 9.10 14.68 19.89 20.28 16.36 31.92 57.86 9.09 6.22 7.44 8.67 4.89 5.51 8.11 9.50
CrowdStrike Holdings Inc. 1.52 1.48 1.65 1.45 1.50 1.46 1.47 1.38 1.32 1.25 1.15 1.02 0.95 0.61 1.19 0.92 0.81 0.71
Fair Isaac Corp. 6.71 7.24 5.63 4.92 11.73 8.02 8.09 9.61 10.86 8.99 15.25 13.60 9.46 111.99 25.98 11.15 10.83 53.70 318.71 63.09
International Business Machines Corp. 273.18 46.83 37.03 17.08 14.55 31.12 12.14
Intuit Inc. 7.87 7.45 5.15 13.92 11.94 8.13 6.30 15.31 10.83 8.98 5.68 21.87 4.39 3.85 3.40 5.45 1.74 1.73 3.19 4.80 4.93
Microsoft Corp. 7.32 7.12 8.26 8.63 2.64 2.65 2.65 2.68 2.77 2.66 2.52 1.91 1.88 1.76 1.71 1.44 1.37 1.30 1.24 1.25 1.20
Oracle Corp. 3.50 3.86 3.39 1.70 1.29 1.69 1.58 1.26 1.12
Palantir Technologies Inc. 0.59 0.58 0.60 0.62 0.63 0.66 0.68 0.71 0.75 0.78 0.81 0.78 0.73 0.70
Palo Alto Networks Inc. 3.52 2.15 1.40 4.81 1.80 1.89
Salesforce Inc. 14.56 14.27 42.02 99.31 90.67 62.21 30.85 25.15 54.57 24.95 27.10 4.36 5.11 7.48 10.29 9.75 15.29
ServiceNow Inc. 11.33 13.25 11.50 11.73 27.96 21.77 19.04 9.59 7.83 11.16 6.63 11.21 10.61 21.76 11.15 16.31 5.62 5.76
Synopsys Inc. 1.53 1.60 2.35 2.82 7.85 13.12 10.27 12.83 17.05 21.34 14.02 7.78 9.47 10.65 9.50 9.18 16.88 9.00 27.06
Workday Inc. 1.70 1.49 1.54 1.60 1.69 1.79 1.83 1.93 2.03 35.15 11.69 24.99 8.31 12.50 3.44 5.62 28.97

Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-10-01), 10-Q (reporting date: 2022-07-02), 10-Q (reporting date: 2022-04-02), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-10-02), 10-Q (reporting date: 2021-07-03), 10-Q (reporting date: 2021-04-03), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-26), 10-Q (reporting date: 2020-06-27), 10-Q (reporting date: 2020-03-28).

1 Q1 2025 Calculation
Working capital turnover = (RevenueQ1 2025 + RevenueQ4 2024 + RevenueQ3 2024 + RevenueQ2 2024) ÷ Working capital
= (1,242,366 + 1,355,981 + 1,215,499 + 1,060,681) ÷ 2,697,320 = 1.81

2 Click competitor name to see calculations.


Working Capital
The working capital exhibited a general upward trend from March 2020 through the end of 2021, increasing from approximately $387 million to around $745 million. This growth was interrupted by a notable decline throughout 2022, with working capital decreasing to about $359 million by December of that year. However, in 2023, working capital showed recovery, rising again to $560 million in September before falling to approximately $385 million by December. Notably, a sharp and substantial increase occurred in the first three quarters of 2024, with working capital surging from around $464 million in June to nearly $2.7 billion by March 2025, indicating a significant shift in the company's liquidity position at the end of the observed period.
Revenue
Revenue demonstrated steady growth over the analyzed periods, starting at roughly $618 million in March 2020 and reaching a peak of approximately $1.36 billion in September 2024. Minor fluctuations were observed, such as a decline in mid-2022 and slight volatility in 2023, but the overall trajectory remained positive. The revenue initially accelerated consistently in 2020, maintained strong performance through 2021, and continued an upward trend with some short-term variations in 2022 and early 2023. The final quarters of 2024 show robust revenue levels, reflecting sustained growth and potential increased market demand or enhanced sales effectiveness.
Working Capital Turnover Ratio
The working capital turnover ratio, available from December 2020 onward, displayed fluctuating behavior. It started at 3.94 and consequently increased to 5.45 by October 2021, suggesting improving efficiency in using working capital to generate revenue. This ratio then declined to 4.01 by December 2021, followed by an increase that peaked significantly at 10.61 in June 2024. Subsequently, the ratio dropped sharply to values near 1.8 by the end of 2024 and early 2025. The initial rising trend indicates increased operational efficiency, but the sharp decline towards the period end correlates with the substantial growth in working capital, implying that while liquidity expanded considerably, revenue growth did not keep pace proportionally, leading to decreased turnover efficiency at that time.
Summary Insights
The data reveals that the company experienced consistent revenue growth, alongside varying levels of liquidity and capital efficiency across the analyzed periods. The sharp increase in working capital towards the end of the timeline, coupled with a declining turnover ratio, suggests a possible strategic accumulation of current assets or changes in operational capital management. The company's ability to grow revenue steadily indicates positive operational momentum, though the efficiency of working capital use fluctuated, peaking mid-2024 before declining markedly in the last observed quarters. This pattern may warrant further examination of the underlying causes such as changes in receivables, inventories, or payables that impact working capital.

Average Inventory Processing Period

Cadence Design Systems Inc., average inventory processing period calculation (quarterly data)

Microsoft Excel
Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Oct 1, 2022 Jul 2, 2022 Apr 2, 2022 Dec 31, 2021 Oct 2, 2021 Jul 3, 2021 Apr 3, 2021 Dec 31, 2020 Sep 26, 2020 Jun 27, 2020 Mar 28, 2020
Selected Financial Data
Inventory turnover 3.06 2.51 1.81 2.79 2.35 2.39 2.59 2.88 3.12 2.90 3.04 3.17 2.91 2.65 3.06 3.50 4.11 4.02
Short-term Activity Ratio (no. days)
Average inventory processing period1 119 145 201 131 156 152 141 127 117 126 120 115 125 138 119 104 89 91
Benchmarks (no. days)
Average Inventory Processing Period, Competitors2
International Business Machines Corp. 19 17 18 16 16 15 19 20 21 20 23 22 24 23 24 21 19 18
Microsoft Corp. 8 6 7 9 16 14 16 17 24 22 20 19 23 18 16 14 21 15 14 15 22
Synopsys Inc. 123 106 117 113 115 97 88 82 74 73 79 82 85 97 103 100 104 88 77 81 72

Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-10-01), 10-Q (reporting date: 2022-07-02), 10-Q (reporting date: 2022-04-02), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-10-02), 10-Q (reporting date: 2021-07-03), 10-Q (reporting date: 2021-04-03), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-26), 10-Q (reporting date: 2020-06-27), 10-Q (reporting date: 2020-03-28).

1 Q1 2025 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 3.06 = 119

2 Click competitor name to see calculations.


Inventory Turnover
The inventory turnover ratio exhibits a fluctuating downward trend starting from the first available data point of 4.02 in December 2020, declining to a low of 1.81 by September 2024. This indicates a gradual slowdown in the frequency with which inventory is sold and replaced over the periods analyzed. There is a modest recovery toward the end of the data timeline, with the ratio rising again to 3.06 in December 2024 and March 2025.
Average Inventory Processing Period
The average inventory processing period, measured in days, shows an inverse pattern to the inventory turnover ratio. Beginning at 91 days in December 2020, the period extends progressively to a peak of 201 days in September 2024, suggesting that inventory remains in stock for a significantly longer duration. Post this peak, there is a notable reduction to 145 days in December 2024 and further down to 119 days by March 2025, indicating improved inventory management efficiencies in the final quarters.
Combined Insights
The inverse relationship between inventory turnover and processing period is consistent throughout the periods analyzed. Periods of decreasing turnover ratio correspond with increasing days in inventory, highlighting potential challenges in selling inventory promptly. However, the late-period trend reversal suggests operational adjustments or market conditions that have improved inventory movement and reduced holding periods, enhancing turnover rates and reducing inventory aging risks.

Average Receivable Collection Period

Cadence Design Systems Inc., average receivable collection period calculation (quarterly data)

Microsoft Excel
Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Oct 1, 2022 Jul 2, 2022 Apr 2, 2022 Dec 31, 2021 Oct 2, 2021 Jul 3, 2021 Apr 3, 2021 Dec 31, 2020 Sep 26, 2020 Jun 27, 2020 Mar 28, 2020
Selected Financial Data
Receivables turnover 8.39 6.82 7.76 7.37 10.46 8.36 9.19 8.62 7.54 7.32 8.78 8.38 8.72 8.85 9.09 7.41 7.21 7.93
Short-term Activity Ratio (no. days)
Average receivable collection period1 43 54 47 50 35 44 40 42 48 50 42 44 42 41 40 49 51 46
Benchmarks (no. days)
Average Receivable Collection Period, Competitors2
Adobe Inc. 33 35 31 29 38 42 36 33 37 43 37 35 38 43 37 37 41 40 39 41 43
CrowdStrike Holdings Inc. 78 102 72 75 69 102 87 83 82 93 80 85 77 100 83 83 93 125
Fair Isaac Corp. 72 91 97 107 86 94 95 87 80 85 77 74 72 87 76 73 87 94 90 91 86
International Business Machines Corp. 34 40 31 34 36 43 32 34 35 39 33 36 37 43 40 38 34 35
Intuit Inc. 9 10 18 22 9 10 19 24 11 13 21 28 15 15 23 22 5 7 12 31 5
Microsoft Corp. 63 85 68 69 62 84 66 64 56 81 62 66 57 83 60 65 57 82 60 64 54
Oracle Corp. 54 54 51 48 47 51 47 49 49 51 40 39 40 49 43 41 43 52
Palantir Technologies Inc. 85 73 92 97 76 60 74 67 47 49 68 56 57 45
Palo Alto Networks Inc. 50 119 80 92 72 130 81 76 78 142 88 72 65 106 70 65 69 111 75 63 60
Salesforce Inc. 44 120 52 60 53 125 52 59 52 134 59 63 52 134 60 65 62 132
ServiceNow Inc. 43 74 46 56 50 83 50 50 53 87 47 47 48 86 51 55 49 82
Synopsys Inc. 54 56 48 50 65 59 44 54 73 57 50 55 84 49 52 56 75 77 66 68 86
Workday Inc. 55 82 64 69 61 92 64 71 53 88 65 68 53 87 65 63 56 88

Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-10-01), 10-Q (reporting date: 2022-07-02), 10-Q (reporting date: 2022-04-02), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-10-02), 10-Q (reporting date: 2021-07-03), 10-Q (reporting date: 2021-04-03), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-26), 10-Q (reporting date: 2020-06-27), 10-Q (reporting date: 2020-03-28).

1 Q1 2025 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 8.39 = 43

2 Click competitor name to see calculations.


Receivables Turnover Ratio
The receivables turnover ratio demonstrates variability over the observed periods, with values fluctuating between approximately 6.82 and 10.46. After an initial reading around 7.93 to 7.21, a peak is noted at 9.19 in the period ending September 30, 2023, and another notable high at 10.46 in June 30, 2024. Toward the latter periods, the ratio shows a marginal decrease but remains above earlier lower points. This variability indicates changes in the efficiency with which receivables are collected over time.
Average Receivable Collection Period
The average receivable collection period, expressed in days, generally shows an inverse trend to the receivables turnover ratio, reflecting the expected relationship. Starting from 46 days, the period extends slightly to 51 days, with fluctuations including a drop to a low of 35 days by June 30, 2024. Some increases follow, reaching up to 54 days by September 30, 2024. The decreasing values at certain points suggest periods of improved efficiency in collection, while increases indicate slower collections. The overall trend highlights fluctuating collection speeds within the company's accounts receivable cycle.
Insight on Relationship Between Metrics
The inverse relationship between the receivables turnover ratio and the average collection period remains consistent, with periods of higher turnover corresponding to shorter collection periods and vice versa. The fluctuations in both metrics suggest periodic changes in credit management practices, customer payment behavior, or possible seasonal trends affecting receivables management.
Overall Assessment
The data reflects a dynamic environment in receivables management, with no steady upward or downward trend but rather oscillations indicating varying efficiency. Periods of heightened efficiency may suggest successful collection efforts or favorable customer payment patterns, while increased collection periods could signal challenges in receivables turnover. Continued monitoring is advised to identify underlying causes for these fluctuations and to implement measures for optimizing receivables collection.

Operating Cycle

Cadence Design Systems Inc., operating cycle calculation (quarterly data)

No. days

Microsoft Excel
Mar 31, 2025 Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Oct 1, 2022 Jul 2, 2022 Apr 2, 2022 Dec 31, 2021 Oct 2, 2021 Jul 3, 2021 Apr 3, 2021 Dec 31, 2020 Sep 26, 2020 Jun 27, 2020 Mar 28, 2020
Selected Financial Data
Average inventory processing period 119 145 201 131 156 152 141 127 117 126 120 115 125 138 119 104 89 91
Average receivable collection period 43 54 47 50 35 44 40 42 48 50 42 44 42 41 40 49 51 46
Short-term Activity Ratio
Operating cycle1 162 199 248 181 191 196 181 169 165 176 162 159 167 179 159 153 140 137
Benchmarks
Operating Cycle, Competitors2
International Business Machines Corp. 53 57 49 50 52 58 51 54 56 59 56 58 61 66 64 59 53 53
Microsoft Corp. 71 91 75 78 78 98 82 81 80 103 82 85 80 101 76 79 78 97 74 79 76
Synopsys Inc. 177 162 165 163 180 156 132 136 147 130 129 137 169 146 155 156 179 165 143 149 158

Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-10-01), 10-Q (reporting date: 2022-07-02), 10-Q (reporting date: 2022-04-02), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-10-02), 10-Q (reporting date: 2021-07-03), 10-Q (reporting date: 2021-04-03), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-26), 10-Q (reporting date: 2020-06-27), 10-Q (reporting date: 2020-03-28).

1 Q1 2025 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 119 + 43 = 162

2 Click competitor name to see calculations.


Average inventory processing period
The average inventory processing period demonstrates an overall upward trend starting from 91 days in early 2021 to 201 days by mid-2024, indicating a lengthening time required to process inventory. This period peaks at 201 days in June 2024, followed by a decline to 119 days by March 2025, suggesting recent improvements in inventory turnover. Fluctuations are evident throughout, with intermittent decreases notably in early 2022 and early 2025, but the general trajectory over the entire span shows an increase in inventory holding duration.
Average receivable collection period
The average receivable collection period reveals variability without a consistent trend. It begins near 46 days in early 2021, fluctuates with minor peaks and troughs, and reaches a low of 35 days in June 2024 before rising again to 54 days by September 2024, then falling to 43 days by March 2025. This oscillation indicates occasional changes in the efficiency of receivables collection, with no sustained improvement or deterioration over the analyzed timeframe.
Operating cycle
The operating cycle, which combines inventory processing and receivables collection periods, largely follows the pattern of the inventory processing period due to its dominant duration. It increases from 137 days in early 2021 to a peak of 248 days in June 2024, reflecting a general lengthening of the time required to convert inventory and receivables into cash. After reaching this high, the operating cycle shortens to 162 days by March 2025. The extended operating cycle through mid-2024 could imply challenges in working capital management, while the subsequent reduction suggests efforts toward improving operational efficiency.