ConocoPhillips (COP)

Inventory turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Cost of revenue (ttm)	US$ in thousands	38,435,000	38,365,000	38,600,000	37,683,000	37,982,000	40,623,000	43,912,000	48,185,000	48,481,000	45,686,000	40,004,000	33,463,000	31,060,000	26,386,000	23,359,000	20,450,000	17,943,000	18,366,000	19,760,000	22,007,000
Inventory	US$ in thousands	1,809,000	1,496,000	1,447,000	1,443,000	1,398,000	1,326,000	1,236,000	1,258,000	1,219,000	1,226,000	1,234,000	1,174,000	1,208,000	1,043,000	1,138,000	1,002,000	1,002,000	1,034,000	982,000	726,000
Inventory turnover		21.25	25.65	26.68	26.11	27.17	30.64	35.53	38.30	39.77	37.26	32.42	28.50	25.71	25.30	20.53	20.41	17.91	17.76	20.12	30.31

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $38,435,000K ÷ $1,809,000K
= 21.25

ConocoPhillips' inventory turnover has exhibited fluctuations over the period under review. The inventory turnover ratio indicates how efficiently the company is managing its inventory levels by measuring how many times the company sells and replaces its inventory during a specific period.

From March 31, 2020, to December 31, 2024, the inventory turnover ratio varied significantly, ranging from a low of 17.76 to a high of 39.77. The trend generally shows an increasing pattern starting from 2020, reaching a peak in 2024 at 39.77, implying that ConocoPhillips has been more efficient in managing its inventory during the latter period.

A higher inventory turnover ratio suggests that the company is selling goods more quickly, which can be seen as positive, as it reduces the risk of inventory obsolescence and carrying costs. Conversely, a lower ratio may indicate sluggish sales, excess inventory, or obsolete stock.

ConocoPhillips' increasing inventory turnover ratio over the years indicates that the company has improved its inventory management efficiency, which may lead to improved cash flows, reduced holding costs, and potentially increased profitability. However, a further analysis in conjunction with other financial metrics would provide a more holistic view of the company's overall performance and efficiency.