IDEXX Laboratories Inc (IDXX)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	1,518,580	1,470,980	1,362,990	1,325,930	1,135,620
Inventory	US$ in thousands	381,877	380,282	367,823	269,030	209,873
Inventory turnover		3.98	3.87	3.71	4.93	5.41

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $1,518,580K ÷ $381,877K
= 3.98

IDEXX Laboratories Inc's inventory turnover has shown a gradual decrease over the past five years. As of December 31, 2020, the inventory turnover ratio was 5.41, indicating that the company was able to sell and replace its inventory 5.41 times during that year. However, by December 31, 2024, the inventory turnover ratio had decreased to 3.98, suggesting that the company took longer to sell and replace its inventory.

The declining trend in inventory turnover may raise concerns about the company's inventory management efficiency. A decreasing inventory turnover ratio could signal potential issues such as excess inventory levels, slow-moving or obsolete inventory, or challenges in demand forecasting.

It is essential for IDEXX Laboratories Inc to closely monitor its inventory turnover and take proactive measures to address any inefficiencies in inventory management. Improving inventory turnover can help the company optimize its working capital, reduce carrying costs, and enhance overall operational performance.