First Solar Inc (FSLR)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	2,348,420	2,017,920	2,549,460	2,193,420	2,030,660
Inventory	US$ in thousands	1,084,380	819,899	621,376	666,299	567,587
Inventory turnover		2.17	2.46	4.10	3.29	3.58

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $2,348,420K ÷ $1,084,380K
= 2.17

First Solar Inc's inventory turnover has fluctuated over the past five years, indicating variations in how efficiently the company manages its inventory.

- In December 2020, the inventory turnover ratio stood at 3.58, suggesting that the company sold and replaced its inventory approximately 3.58 times during that year.
- The ratio slightly decreased to 3.29 by December 2021, indicating a slight decline in inventory turnover efficiency.
- Subsequently, there was an improvement in inventory turnover to 4.10 by December 2022, indicating that the company managed to sell and replace its inventory more frequently during that period.
- However, by December 2023, the inventory turnover dropped significantly to 2.46, suggesting a possible inefficiency in managing inventory levels or potential challenges in selling products.
- The trend continued in December 2024, with the inventory turnover ratio falling further to 2.17, signaling a decline in the pace of inventory turnover.

Overall, the fluctuating trend in First Solar Inc's inventory turnover ratios highlights the importance of continuous monitoring and evaluation of inventory management practices to ensure optimal efficiency and profitability.