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)
Microsoft Corp., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Microsoft Corp. inventory turnover ratio improved from 2022 to 2023 and from 2023 to 2024. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Microsoft Corp. receivables turnover ratio deteriorated from 2022 to 2023 and from 2023 to 2024. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Microsoft Corp. payables turnover ratio increased from 2022 to 2023 but then slightly decreased from 2023 to 2024 not reaching 2022 level. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Microsoft Corp. working capital turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level. |
| 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. | Microsoft Corp. number of days of inventory outstanding improved from 2022 to 2023 and from 2023 to 2024. |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Microsoft Corp. number of days of receivables outstanding deteriorated from 2022 to 2023 and from 2023 to 2024. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Microsoft Corp. operating cycle improved 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. | Microsoft Corp. number of days of payables outstanding decreased from 2022 to 2023 but then increased from 2023 to 2024 not reaching 2022 level. |
| 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. | Microsoft Corp. cash conversion cycle deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level. |
Inventory Turnover
Microsoft Corp., inventory turnover calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Cost of revenue | 74,114) | 65,863) | 62,650) | 52,232) | 46,078) | 42,910) | |
| Inventories | 1,246) | 2,500) | 3,742) | 2,636) | 1,895) | 2,063) | |
| Short-term Activity Ratio | |||||||
| Inventory turnover1 | 59.48 | 26.35 | 16.74 | 19.81 | 24.32 | 20.80 | |
| Benchmarks | |||||||
| Inventory Turnover, Competitors2 | |||||||
| Cadence Design Systems Inc. | — | 2.39 | 2.90 | 2.65 | 4.02 | 4.77 | |
| International Business Machines Corp. | — | 23.74 | 17.94 | 15.68 | 20.69 | 25.11 | |
| Oracle Corp. | 45.34 | 45.52 | 28.27 | 55.32 | 37.62 | 24.98 | |
| Synopsys Inc. | — | 3.75 | 5.02 | 3.76 | 4.13 | 5.32 | |
| Inventory Turnover, Sector | |||||||
| Software & Services | — | 38.24 | 26.63 | 27.97 | 31.64 | 31.12 | |
| Inventory Turnover, Industry | |||||||
| Information Technology | — | 7.40 | 8.17 | 9.78 | 10.43 | 10.62 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Inventory turnover = Cost of revenue ÷ Inventories
= 74,114 ÷ 1,246 = 59.48
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. | Microsoft Corp. inventory turnover ratio improved from 2022 to 2023 and from 2023 to 2024. |
Receivables Turnover
Microsoft Corp., receivables turnover calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Revenue | 245,122) | 211,915) | 198,270) | 168,088) | 143,015) | 125,843) | |
| Accounts receivable, net of allowance for doubtful accounts | 56,924) | 48,688) | 44,261) | 38,043) | 32,011) | 29,524) | |
| Short-term Activity Ratio | |||||||
| Receivables turnover1 | 4.31 | 4.35 | 4.48 | 4.42 | 4.47 | 4.26 | |
| Benchmarks | |||||||
| Receivables Turnover, Competitors2 | |||||||
| Accenture PLC | 5.47 | 6.00 | 5.87 | 5.74 | 6.16 | 5.79 | |
| Adobe Inc. | — | 8.73 | 8.53 | 8.41 | 9.20 | 7.28 | |
| Autodesk Inc. | 6.28 | 5.21 | 6.13 | 5.89 | 5.02 | 5.42 | |
| Cadence Design Systems Inc. | — | 8.36 | 7.32 | 8.85 | 7.93 | 7.67 | |
| CrowdStrike Holdings Inc. | 3.58 | 3.58 | 3.94 | 3.66 | 2.92 | — | |
| International Business Machines Corp. | — | 8.57 | 9.25 | 8.49 | 10.32 | 9.80 | |
| Intuit Inc. | 35.63 | 35.48 | 28.53 | 24.64 | 51.54 | 77.98 | |
| Oracle Corp. | 6.73 | 7.22 | 7.13 | 7.48 | 7.04 | 7.69 | |
| Palo Alto Networks Inc. | 3.07 | 2.80 | 2.57 | 3.43 | 3.29 | 4.98 | |
| Salesforce Inc. | 3.05 | 2.92 | 2.72 | 2.73 | 2.77 | 2.70 | |
| ServiceNow Inc. | — | 4.41 | 4.20 | 4.24 | 4.48 | 4.14 | |
| Synopsys Inc. | — | 6.17 | 6.38 | 7.40 | 4.72 | 6.07 | |
| Receivables Turnover, Sector | |||||||
| Software & Services | — | 5.15 | 5.21 | 5.24 | 5.59 | 5.59 | |
| Receivables Turnover, Industry | |||||||
| Information Technology | — | 7.37 | 7.42 | 7.55 | 8.00 | 7.59 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Receivables turnover = Revenue ÷ Accounts receivable, net of allowance for doubtful accounts
= 245,122 ÷ 56,924 = 4.31
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. | Microsoft Corp. receivables turnover ratio deteriorated from 2022 to 2023 and from 2023 to 2024. |
Payables Turnover
Microsoft Corp., payables turnover calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Cost of revenue | 74,114) | 65,863) | 62,650) | 52,232) | 46,078) | 42,910) | |
| Accounts payable | 21,996) | 18,095) | 19,000) | 15,163) | 12,530) | 9,382) | |
| Short-term Activity Ratio | |||||||
| Payables turnover1 | 3.37 | 3.64 | 3.30 | 3.44 | 3.68 | 4.57 | |
| Benchmarks | |||||||
| Payables Turnover, Competitors2 | |||||||
| Accenture PLC | 15.94 | 17.41 | 16.37 | 15.03 | 22.48 | 18.16 | |
| Adobe Inc. | — | 7.50 | 5.71 | 5.98 | 5.63 | 7.98 | |
| Autodesk Inc. | 5.11 | 4.71 | 3.46 | 2.75 | 3.88 | 2.81 | |
| Cadence Design Systems Inc. | — | 4.77 | 7.89 | — | — | — | |
| CrowdStrike Holdings Inc. | 26.82 | 13.25 | 8.05 | 19.03 | 105.30 | — | |
| International Business Machines Corp. | — | 6.67 | 6.87 | 6.54 | 7.75 | 8.30 | |
| Intuit Inc. | 4.81 | 4.93 | 3.26 | 2.70 | 4.52 | 4.26 | |
| Oracle Corp. | 6.42 | 11.27 | 6.74 | 10.54 | 12.46 | 13.78 | |
| Palo Alto Networks Inc. | 17.71 | 14.43 | 13.43 | 22.41 | 15.72 | 11.03 | |
| Salesforce Inc. | — | — | — | — | — | — | |
| ServiceNow Inc. | — | 15.25 | 5.74 | 15.20 | 28.83 | 15.04 | |
| Synopsys Inc. | — | 7.84 | 28.30 | 31.44 | 26.49 | 38.00 | |
| Payables Turnover, Sector | |||||||
| Software & Services | — | 6.20 | 5.52 | 5.71 | 6.58 | 7.58 | |
| Payables Turnover, Industry | |||||||
| Information Technology | — | 4.87 | 4.54 | 4.99 | 5.35 | 5.27 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Payables turnover = Cost of revenue ÷ Accounts payable
= 74,114 ÷ 21,996 = 3.37
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. | Microsoft Corp. payables turnover ratio increased from 2022 to 2023 but then slightly decreased from 2023 to 2024 not reaching 2022 level. |
Working Capital Turnover
Microsoft Corp., working capital turnover calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Current assets | 159,734) | 184,257) | 169,684) | 184,406) | 181,915) | 175,552) | |
| Less: Current liabilities | 125,286) | 104,149) | 95,082) | 88,657) | 72,310) | 69,420) | |
| Working capital | 34,448) | 80,108) | 74,602) | 95,749) | 109,605) | 106,132) | |
| Revenue | 245,122) | 211,915) | 198,270) | 168,088) | 143,015) | 125,843) | |
| Short-term Activity Ratio | |||||||
| Working capital turnover1 | 7.12 | 2.65 | 2.66 | 1.76 | 1.30 | 1.19 | |
| Benchmarks | |||||||
| Working Capital Turnover, Competitors2 | |||||||
| Accenture PLC | 34.49 | 11.93 | 15.07 | 12.77 | 8.71 | 9.85 | |
| Adobe Inc. | — | 6.85 | 20.28 | 9.09 | 4.89 | — | |
| Autodesk Inc. | — | — | — | — | — | — | |
| Cadence Design Systems Inc. | — | 10.61 | 9.92 | 4.01 | 3.94 | 4.70 | |
| CrowdStrike Holdings Inc. | 1.48 | 1.46 | 1.25 | 0.61 | 0.71 | — | |
| International Business Machines Corp. | — | — | — | — | — | 107.30 | |
| Intuit Inc. | 7.45 | 8.13 | 8.98 | 3.85 | 1.73 | 4.17 | |
| Oracle Corp. | — | — | 3.50 | 1.29 | 1.12 | 1.42 | |
| Palo Alto Networks Inc. | — | — | — | — | 1.40 | 1.80 | |
| Salesforce Inc. | 14.27 | 62.21 | 24.95 | 5.11 | 15.29 | — | |
| ServiceNow Inc. | — | 21.77 | 11.16 | 21.76 | 5.76 | 46.69 | |
| Synopsys Inc. | — | 13.12 | 21.34 | 10.65 | 9.00 | — | |
| Working Capital Turnover, Sector | |||||||
| Software & Services | — | 5.54 | 4.91 | 2.81 | 2.20 | 2.37 | |
| Working Capital Turnover, Industry | |||||||
| Information Technology | — | 5.24 | 5.71 | 3.86 | 2.86 | 3.06 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Working capital turnover = Revenue ÷ Working capital
= 245,122 ÷ 34,448 = 7.12
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. | Microsoft Corp. working capital turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level. |
Average Inventory Processing Period
Microsoft Corp., average inventory processing period calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Inventory turnover | 59.48 | 26.35 | 16.74 | 19.81 | 24.32 | 20.80 | |
| Short-term Activity Ratio (no. days) | |||||||
| Average inventory processing period1 | 6 | 14 | 22 | 18 | 15 | 18 | |
| Benchmarks (no. days) | |||||||
| Average Inventory Processing Period, Competitors2 | |||||||
| Cadence Design Systems Inc. | — | 152 | 126 | 138 | 91 | 76 | |
| International Business Machines Corp. | — | 15 | 20 | 23 | 18 | 15 | |
| Oracle Corp. | 8 | 8 | 13 | 7 | 10 | 15 | |
| Synopsys Inc. | — | 97 | 73 | 97 | 88 | 69 | |
| Average Inventory Processing Period, Sector | |||||||
| Software & Services | — | 10 | 14 | 13 | 12 | 12 | |
| Average Inventory Processing Period, Industry | |||||||
| Information Technology | — | 49 | 45 | 37 | 35 | 34 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 59.48 = 6
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. | Microsoft Corp. number of days of inventory outstanding improved from 2022 to 2023 and from 2023 to 2024. |
Average Receivable Collection Period
Microsoft Corp., average receivable collection period calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Receivables turnover | 4.31 | 4.35 | 4.48 | 4.42 | 4.47 | 4.26 | |
| Short-term Activity Ratio (no. days) | |||||||
| Average receivable collection period1 | 85 | 84 | 81 | 83 | 82 | 86 | |
| Benchmarks (no. days) | |||||||
| Average Receivable Collection Period, Competitors2 | |||||||
| Accenture PLC | 67 | 61 | 62 | 64 | 59 | 63 | |
| Adobe Inc. | — | 42 | 43 | 43 | 40 | 50 | |
| Autodesk Inc. | 58 | 70 | 60 | 62 | 73 | 67 | |
| Cadence Design Systems Inc. | — | 44 | 50 | 41 | 46 | 48 | |
| CrowdStrike Holdings Inc. | 102 | 102 | 93 | 100 | 125 | — | |
| International Business Machines Corp. | — | 43 | 39 | 43 | 35 | 37 | |
| Intuit Inc. | 10 | 10 | 13 | 15 | 7 | 5 | |
| Oracle Corp. | 54 | 51 | 51 | 49 | 52 | 47 | |
| Palo Alto Networks Inc. | 119 | 130 | 142 | 106 | 111 | 73 | |
| Salesforce Inc. | 120 | 125 | 134 | 134 | 132 | 135 | |
| ServiceNow Inc. | — | 83 | 87 | 86 | 82 | 88 | |
| Synopsys Inc. | — | 59 | 57 | 49 | 77 | 60 | |
| Average Receivable Collection Period, Sector | |||||||
| Software & Services | — | 71 | 70 | 70 | 65 | 65 | |
| Average Receivable Collection Period, Industry | |||||||
| Information Technology | — | 50 | 49 | 48 | 46 | 48 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 4.31 = 85
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. | Microsoft Corp. number of days of receivables outstanding deteriorated from 2022 to 2023 and from 2023 to 2024. |
Operating Cycle
Microsoft Corp., operating cycle calculation, comparison to benchmarks
No. days
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Average inventory processing period | 6 | 14 | 22 | 18 | 15 | 18 | |
| Average receivable collection period | 85 | 84 | 81 | 83 | 82 | 86 | |
| Short-term Activity Ratio | |||||||
| Operating cycle1 | 91 | 98 | 103 | 101 | 97 | 104 | |
| Benchmarks | |||||||
| Operating Cycle, Competitors2 | |||||||
| Cadence Design Systems Inc. | — | 196 | 176 | 179 | 137 | 124 | |
| International Business Machines Corp. | — | 58 | 59 | 66 | 53 | 52 | |
| Oracle Corp. | 62 | 59 | 64 | 56 | 62 | 62 | |
| Synopsys Inc. | — | 156 | 130 | 146 | 165 | 129 | |
| Operating Cycle, Sector | |||||||
| Software & Services | — | 81 | 84 | 83 | 77 | 77 | |
| Operating Cycle, Industry | |||||||
| Information Technology | — | 99 | 94 | 85 | 81 | 82 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 6 + 85 = 91
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. | Microsoft Corp. operating cycle improved from 2022 to 2023 and from 2023 to 2024. |
Average Payables Payment Period
Microsoft Corp., average payables payment period calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Payables turnover | 3.37 | 3.64 | 3.30 | 3.44 | 3.68 | 4.57 | |
| Short-term Activity Ratio (no. days) | |||||||
| Average payables payment period1 | 108 | 100 | 111 | 106 | 99 | 80 | |
| Benchmarks (no. days) | |||||||
| Average Payables Payment Period, Competitors2 | |||||||
| Accenture PLC | 23 | 21 | 22 | 24 | 16 | 20 | |
| Adobe Inc. | — | 49 | 64 | 61 | 65 | 46 | |
| Autodesk Inc. | 71 | 78 | 105 | 133 | 94 | 130 | |
| Cadence Design Systems Inc. | — | 77 | 46 | — | — | — | |
| CrowdStrike Holdings Inc. | 14 | 28 | 45 | 19 | 3 | — | |
| International Business Machines Corp. | — | 55 | 53 | 56 | 47 | 44 | |
| Intuit Inc. | 76 | 74 | 112 | 135 | 81 | 86 | |
| Oracle Corp. | 57 | 32 | 54 | 35 | 29 | 26 | |
| Palo Alto Networks Inc. | 21 | 25 | 27 | 16 | 23 | 33 | |
| Salesforce Inc. | — | — | — | — | — | — | |
| ServiceNow Inc. | — | 24 | 64 | 24 | 13 | 24 | |
| Synopsys Inc. | — | 47 | 13 | 12 | 14 | 10 | |
| Average Payables Payment Period, Sector | |||||||
| Software & Services | — | 59 | 66 | 64 | 55 | 48 | |
| Average Payables Payment Period, Industry | |||||||
| Information Technology | — | 75 | 80 | 73 | 68 | 69 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 3.37 = 108
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. | Microsoft Corp. number of days of payables outstanding decreased from 2022 to 2023 but then increased from 2023 to 2024 not reaching 2022 level. |
Cash Conversion Cycle
Microsoft Corp., cash conversion cycle calculation, comparison to benchmarks
No. days
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Average inventory processing period | 6 | 14 | 22 | 18 | 15 | 18 | |
| Average receivable collection period | 85 | 84 | 81 | 83 | 82 | 86 | |
| Average payables payment period | 108 | 100 | 111 | 106 | 99 | 80 | |
| Short-term Activity Ratio | |||||||
| Cash conversion cycle1 | -17 | -2 | -8 | -5 | -2 | 24 | |
| Benchmarks | |||||||
| Cash Conversion Cycle, Competitors2 | |||||||
| Cadence Design Systems Inc. | — | 119 | 130 | — | — | — | |
| International Business Machines Corp. | — | 3 | 6 | 10 | 6 | 8 | |
| Oracle Corp. | 5 | 27 | 10 | 21 | 33 | 36 | |
| Synopsys Inc. | — | 109 | 117 | 134 | 151 | 119 | |
| Cash Conversion Cycle, Sector | |||||||
| Software & Services | — | 22 | 18 | 19 | 22 | 29 | |
| Cash Conversion Cycle, Industry | |||||||
| Information Technology | — | 24 | 14 | 12 | 13 | 13 | |
Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30).
1 2024 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 6 + 85 – 108 = -17
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. | Microsoft Corp. cash conversion cycle deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level. |