Chevron Corp (CVX)

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	136,488,000	136,098,000	137,787,000	135,421,000	136,522,000	141,229,000	147,828,000	159,707,000	163,839,000	156,555,000	141,741,000	122,508,000	107,297,000	93,016,000	82,343,000	72,053,000	69,996,000	88,245,000	95,023,000	105,331,000
Inventory	US$ in thousands	9,074,000	9,725,000	10,477,000	9,942,000	8,612,000	9,428,000	9,198,000	9,232,000	8,247,000	9,002,000	7,715,000	6,525,000	6,795,000	6,129,000	6,239,000	5,620,000	5,676,000	5,681,000	5,511,000	6,574,000
Inventory turnover		15.04	13.99	13.15	13.62	15.85	14.98	16.07	17.30	19.87	17.39	18.37	18.78	15.79	15.18	13.20	12.82	12.33	15.53	17.24	16.02

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $136,488,000K ÷ $9,074,000K
= 15.04

Inventory turnover is a crucial financial ratio used to assess a company's efficiency in managing its inventory. For Chevron Corp, we observe fluctuations in inventory turnover over the analyzed periods. The inventory turnover ratio measures how many times a company's inventory is sold and replaced over a certain period. A higher inventory turnover ratio indicates that inventory is selling quickly, which is favorable.

From March 31, 2020, to December 31, 2024, Chevron's inventory turnover ranged from 12.33 to 19.87. The company saw a peak in inventory turnover in December 31, 2022, at 19.87, indicating robust inventory management efficiency. Conversely, the lowest inventory turnover occurred on March 31, 2024, at 13.62. It is essential to note that a lower inventory turnover ratio may suggest potential issues such as overstocking, obsolete inventory, or sluggish sales.

Overall, Chevron's inventory turnover has displayed variability over the analyzed period. The company should maintain an optimal balance in managing inventory levels to ensure efficient operations and profitability. Monitoring and improving inventory turnover can help Chevron optimize working capital, minimize holding costs, and enhance overall operational efficiency in handling inventory assets.