Hims Hers Health Inc (HIMS)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 303,379 | 157,051 | 118,194 | 67,384 | 39,307 |
| Inventory | US$ in thousands | 64,427 | 22,464 | 21,562 | 13,558 | 3,543 |
| Inventory turnover | 4.71 | 6.99 | 5.48 | 4.97 | 11.09 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $303,379K ÷ $64,427K
= 4.71
Based on the provided data, Hims Hers Health Inc's inventory turnover has shown fluctuations over the years. In December 2020, the company had a high inventory turnover of 11.09 times, indicating that its inventory was sold and replaced more than 11 times during that year. However, in the subsequent years, the inventory turnover decreased, reaching 4.97 in December 2021, 5.48 in December 2022, 6.99 in December 2023, and then dropping again to 4.71 in December 2024.
The declining trend in inventory turnover from 2020 to 2024 suggests that the company may be holding onto its inventory for a longer period before selling it. This could be due to factors such as changes in consumer demand, production delays, or inefficiencies in the supply chain.
It is important for Hims Hers Health Inc to monitor its inventory turnover regularly to ensure efficient management of its inventory levels. A lower inventory turnover may indicate excess inventory, which ties up capital and could lead to obsolescence or write-offs. On the other hand, a very high turnover could suggest missed sales opportunities due to stockouts.
Overall, Hims Hers Health Inc should further investigate the reasons for the fluctuations in inventory turnover and take appropriate actions to optimize its inventory management processes for better efficiency and profitability.
Peer comparison
Dec 31, 2024