AutoZone Inc (AZO)

Inventory turnover

		Aug 31, 2024	Aug 26, 2023	Aug 27, 2022	Aug 28, 2021	Aug 29, 2020
Cost of revenue	US$ in thousands	8,673,220	8,386,790	7,779,580	6,911,800	5,861,210
Inventory	US$ in thousands	6,155,220	5,764,140	5,638,000	4,639,810	4,473,280
Inventory turnover		1.41	1.45	1.38	1.49	1.31

August 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $8,673,220K ÷ $6,155,220K
= 1.41

AutoZone Inc's inventory turnover ratio has fluctuated over the past five years. The inventory turnover ratio indicates how efficiently the company is managing its inventory by measuring how many times the inventory is sold and replaced within a specific period.

In 2024, the inventory turnover was 1.41, a decrease from the previous year's 1.45. This suggests that AutoZone Inc took longer to sell and replace its inventory compared to the previous year. A lower inventory turnover ratio may indicate overstocking, slow sales, or poor inventory management.

In 2022, the inventory turnover ratio was 1.38, which was slightly lower than in 2021 (1.49). This decline may indicate that the company was less efficient in managing its inventory turnover that year.

In 2020, the inventory turnover ratio was 1.31, which was the lowest compared to the other years analyzed. A lower inventory turnover ratio may suggest that AutoZone Inc was struggling to sell its inventory efficiently, leading to potential carrying costs and obsolescence risks.

Overall, AutoZone Inc's inventory turnover has shown some variability over the years, indicating fluctuations in the company's inventory management efficiency. Analysts and investors should closely monitor changes in the inventory turnover ratio to assess the company's operational performance and potential challenges in managing its inventory effectively.