FormFactor Inc (FORM)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	546,219	608,780	595,067	548,785	485,975
Inventory	US$ in thousands	111,685	123,157	111,548	99,229	83,258
Inventory turnover		4.89	4.94	5.33	5.53	5.84

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $546,219K ÷ $111,685K
= 4.89

FormFactor Inc's inventory turnover ratio has shown a declining trend over the past five years. The ratio decreased from 5.84 in 2019 to 4.89 in 2023. This downward trend indicates that the company is taking longer to sell its inventory. A lower inventory turnover ratio may suggest issues such as overstocking, slow-moving inventory, or changing customer preferences affecting sales. It is important for FormFactor Inc to closely monitor and address the factors contributing to this decline in inventory turnover to optimize its inventory management and operational efficiency.