Garmin Ltd (GRMN)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,739,970 | 3,088,800 | 2,860,040 | 2,787,860 | 2,310,280 |
| Inventory | US$ in thousands | 1,473,980 | 1,345,960 | 1,515,040 | 1,227,610 | 762,084 |
| Inventory turnover | 2.54 | 2.29 | 1.89 | 2.27 | 3.03 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $3,739,970K ÷ $1,473,980K
= 2.54
The inventory turnover for Garmin Ltd has shown a declining trend over the years. In 2020, the inventory turnover was 3.03, indicating that the company's inventory was sold and replaced approximately 3.03 times during the year. However, this ratio decreased to 2.27 in 2021, 1.89 in 2022, and then slightly increased to 2.29 in 2023 and 2.54 in 2024.
A decreasing trend in inventory turnover may suggest that Garmin is taking longer to sell its inventory, which could potentially lead to higher holding costs or obsolescence risks. It's important for the company to manage its inventory efficiently to avoid tying up capital in slow-moving or obsolete inventory.
Overall, Garmin Ltd's inventory turnover has been fluctuating, and it would be beneficial for the company to closely monitor and optimize its inventory management practices to improve this ratio and enhance operational efficiency.
Peer comparison
Dec 31, 2024