Carter’s Inc (CRI)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	1,186,310	1,143,900	1,190,010	1,280,440	1,259,680
Inventory	US$ in thousands	502,332	537,125	744,573	647,742	599,262
Inventory turnover		2.36	2.13	1.60	1.98	2.10

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $1,186,310K ÷ $502,332K
= 2.36

Inventory turnover measures how efficiently a company manages its inventory by showing how many times it sells and replaces its inventory during a specific period.

For Carter’s Inc, the inventory turnover ratio has fluctuated over the past five years. In December 2020, the ratio was 2.10, indicating that the company turned over its inventory 2.10 times during that year. However, in December 2021, the ratio decreased slightly to 1.98, suggesting a slower pace of inventory turnover.

By December 2022, Carter’s Inc experienced a more significant drop in inventory turnover, with the ratio falling to 1.60. This indicates that the company took longer to sell and replace its inventory that year.

The trend reversed in December 2023, as the inventory turnover ratio improved to 2.13. This suggests that the company managed its inventory more efficiently compared to the previous year.

In the most recent period, December 2024, Carter’s Inc saw a further improvement in inventory turnover, with the ratio increasing to 2.36. This indicates that the company was able to sell and replace its inventory at a faster pace, reflecting improved inventory management.

Overall, the fluctuation in Carter’s Inc inventory turnover ratios over the years highlights the importance of effective inventory management practices in optimizing operational efficiency and financial performance. A higher inventory turnover ratio generally indicates better inventory management and liquidity, while a lower ratio may signal excess inventory or potential sales challenges that could impact profitability.