Goodyear Tire & Rubber Co (GT)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 20,148,000 | 19,925,000 | 16,514,000 | 12,913,000 | 14,143,000 |
| Inventory | US$ in thousands | 3,698,000 | 4,571,000 | 3,594,000 | 2,153,000 | 2,851,000 |
| Inventory turnover | 5.45 | 4.36 | 4.59 | 6.00 | 4.96 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $20,148,000K ÷ $3,698,000K
= 5.45
The inventory turnover ratio for Goodyear Tire & Rubber Co. has fluctuated over the past five years. In 2023, the inventory turnover ratio increased to 4.48 from 3.71 in 2022, indicating that the company's inventory was sold and replaced approximately 4.48 times during the year. This suggests that Goodyear efficiently managed its inventory in 2023.
Compared to the previous years, the inventory turnover ratio was relatively low in 2022 and 2021 at 3.71 and 3.81, respectively. This may indicate that Goodyear held onto its inventory for a longer period in these years before it was sold.
However, in 2020 and 2019, the inventory turnover ratios were higher at 4.80 and 4.07, respectively. This suggests that inventory management was more efficient in these years, with faster turnover of inventory.
Overall, while inventory turnover ratios can vary from year to year, a higher ratio generally indicates efficient management of inventory, while a lower ratio may suggest that inventory is being held for a longer period. It is important for Goodyear to monitor and evaluate its inventory turnover ratio to ensure optimal inventory management and improve operational efficiency.