Devon Energy Corporation (DVN)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 564,000 | 451,000 | 428,000 | 689,000 | 3,120,000 |
| Inventory | US$ in thousands | 294,000 | 249,000 | 201,000 | 114,000 | — |
| Inventory turnover | 1.92 | 1.81 | 2.13 | 6.04 | — |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $564,000K ÷ $294,000K
= 1.92
The inventory turnover for Devon Energy Corporation has shown fluctuations over the past five years. In 2021, the inventory turnover ratio was 6.04, indicating that the company's inventory was turned over approximately 6 times during that year. However, there was a significant decline in 2022, with the ratio dropping to 2.13, suggesting a slower turnover of inventory. This trend continued in 2023 and 2024, with the inventory turnover ratios dropping further to 1.81 and 1.92, respectively.
A lower inventory turnover ratio could imply inefficiencies in managing inventory levels or potential issues with sales and demand forecasting. It is essential for the company to monitor and analyze its inventory turnover to optimize its operations, minimize holding costs, and ensure smooth cash flow management. Further investigation into the reasons behind the declining inventory turnover ratios could provide valuable insights for improving operational efficiency and overall financial performance.
Peer comparison
Dec 31, 2024