Advanced Micro Devices Inc (AMD)

Days of inventory on hand (DOH)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Inventory turnover		3.34	4.14	5.17	5.30	4.81
DOH	days	109.24	88.11	70.56	68.88	75.95

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.34
= 109.24

Days of Inventory on Hand (DOH) is a key efficiency ratio that measures the number of days a company holds inventory before selling it. For Advanced Micro Devices Inc, the trend in DOH over the past five years has shown some fluctuations.

As of December 31, 2020, the company had 75.95 days of inventory on hand, which decreased to 68.88 days as of December 31, 2021. This decline suggests that AMD was able to sell its inventory more quickly in 2021 compared to the previous year, which can be indicative of effective inventory management.

However, the DOH increased slightly to 70.56 days by December 31, 2022, before jumping to 88.11 days by December 31, 2023, and eventually reaching 109.24 days by December 31, 2024. These increases in inventory holding period may indicate slower inventory turnover, which could potentially lead to higher carrying costs and inefficiencies in the company's operations.

Overall, the increasing trend in DOH over the past few years for Advanced Micro Devices Inc raises concerns about the management of inventory levels and the need to address potential inefficiencies in inventory control processes to optimize working capital and improve operational performance.