But this isn't a cash flow statement, thus "This seems like a measurement you have to be careful with". Are there analysis of Apple's financials that show a 5 day mean inventory wait?
Cost of sales: 20.6 billion
Inventories : 1.1 billion
Cost of sales is what they spend to buy the stuff they sell.
20.6/1.1 is about 18, so they have to sell their inventory 18 times in a quarter. A quarter has about 90 days; 90/18 = 5.
It is possible that they force their inventory down a bit at end of quarters to make the figures look better, but I doubt Apple in its current form will find that worthwhile.
That's right. Non-cash increases in working capital assets are deductions from operating cash flow, reflecting the fact that you have to pay cash for the new goods.
Companies can finance by borrowing, either from suppliers (e.g. payables) or lenders, which appears as sources of cash. But if the debt is long-term that cash appears elsewhere on the cash flow statement and so don't counterbalance the use of operating cash.
Why is operating cash important? Investors focus on it because that's how companies make money. Investing cash flow reflects hard-to-repeat asset sales, financing cash flows must be repaid. And it's hard to game operating cash flow without raising flags elsewhere.
But here the financial analysis is more important for its signals of marketing and operational strength.
Apple can't maintain low inventories, especially while growing revenue, without knowing its market pretty well. And low inventories mean it doesn't cost them much to obsolete their own products, and doesn't cost them as much to try products that don't work out. The dollars saved by low inventory don't mean so much relative to the overall enterprise, but they can't keep this metric low without real strength up and down the company.
Yes it would, just look at the cash flow statement.