Allegro Microsystems Inc (ALGM)

Inventory turnover

		Mar 31, 2025	Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Cost of revenue	US$ in thousands	403,479	474,838	427,574	361,214	312,305
Inventory	US$ in thousands	183,914	162,302	151,301	86,160	87,498
Inventory turnover		2.19	2.93	2.83	4.19	3.57

March 31, 2025 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $403,479K ÷ $183,914K
= 2.19

Allegro Microsystems Inc's inventory turnover has shown fluctuations over the past five years. The inventory turnover ratio, which measures how efficiently a company manages its inventory, increased from 3.57 in March 2021 to 4.19 in March 2022, indicating an improvement in inventory management. However, there was a drop in the ratio to 2.83 in March 2023 and 2.93 in March 2024, suggesting potential challenges in managing inventory levels efficiently during these periods. In March 2025, the inventory turnover ratio further declined to 2.19, indicating a continued decrease in the company's ability to turn over its inventory effectively. This downward trend may raise concerns about overstocking or slow-moving inventory, which can tie up capital and affect profitability. Allegro Microsystems Inc may need to reassess its inventory management strategies to enhance efficiency and optimize its use of resources.