DIO

Business & Finance abbreviation · Finance

DIO
Stands forDays inventory outstanding
CategoriesBusiness & Finance

DIO stands for Days inventory outstanding, a finance abbreviation.

Average number of days a company holds inventory before selling it, calculated as inventory divided by cost of goods sold, multiplied by days in the period. Lower DIO generally indicates efficient inventory management.

Example: Grocery chains typically run a DIO of a few weeks, while aircraft makers may hold inventory for well over a year.

Usage notes

Also called days in inventory or days sales of inventory (DSI). DIO varies enormously by industry, so comparisons are meaningful only among peers. A sudden rise can signal weak demand or obsolete stock that may need to be written down.

More finance abbreviations

  • CIM – Confidential information memorandum
  • CVC – Corporate venture capital
  • D/E – Debt-to-equity ratio
  • DCF – Discounted cash flow
  • DCM – Debt capital markets
  • DD – Due diligence
  • DPI – Distributions to paid-in capital
  • DPO – Days payable outstanding
  • DSCR – Debt service coverage ratio
  • DSO – Days sales outstanding
  • EAR – Effective annual rate
  • ECM – Equity capital markets

See all 88 finance abbreviations →