Halliburton Company (HAL)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	392,000	256,000	696,000	236,000	4,506,000
Inventory	US$ in thousands	3,040,000	3,226,000	2,923,000	2,361,000	2,349,000
Inventory turnover		0.13	0.08	0.24	0.10	1.92

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $392,000K ÷ $3,040,000K
= 0.13

Halliburton Company's inventory turnover has fluctuated significantly over the past five years.

As of December 31, 2020, the inventory turnover stood at 1.92, indicating that the company sold its inventory nearly 1.92 times during that year. However, there has been a sharp decline in the inventory turnover in the subsequent years.

By December 31, 2021, the inventory turnover plummeted to 0.10, suggesting a substantial decrease in the rate at which inventory was sold. This low turnover rate could potentially indicate overstocking or issues with demand for the company's products.

In 2022, there was a slight improvement in inventory turnover to 0.24, but it remained relatively low, signaling ongoing challenges in efficiently managing and selling inventory.

The trend reversed in 2023, with the inventory turnover decreasing significantly to 0.08, reaching the lowest point in the five-year period. This may raise concerns about inventory management practices and the company's ability to effectively control stock levels.

By the end of 2024, the inventory turnover slightly improved to 0.13, but it still remains considerably below the level seen in 2020. The persistent low turnover rate could indicate the need for Halliburton Company to reassess its inventory management strategies and align them better with market demand to improve operational efficiency and profitability.