Ingersoll Rand Inc (IR)

Inventory turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Cost of revenue (ttm) US$ in thousands 4,065,000 4,022,000 3,975,600 3,952,600 3,993,900 3,923,000 3,863,800 3,744,900 3,590,700 3,530,800 3,401,100 3,297,400 3,163,900 3,010,000 2,881,800 2,832,200 2,640,600 1,964,600 1,657,300 1,335,200
Inventory US$ in thousands 1,055,000 1,162,500 1,160,000 1,051,800 1,001,100 1,082,900 1,101,300 1,122,600 1,025,400 1,012,500 1,013,500 954,900 854,200 863,600 796,800 832,500 716,700 1,007,400 1,026,400 1,088,100
Inventory turnover 3.85 3.46 3.43 3.76 3.99 3.62 3.51 3.34 3.50 3.49 3.36 3.45 3.70 3.49 3.62 3.40 3.68 1.95 1.61 1.23

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $4,065,000K ÷ $1,055,000K
= 3.85

Ingersoll Rand Inc's inventory turnover has shown a steady improvement over the past few years. The inventory turnover ratio measures how many times a company's inventory is sold and replaced over a certain period. A higher inventory turnover ratio indicates that the company is efficiently managing its inventory.

From March 31, 2020, to December 31, 2024, Ingersoll Rand Inc's inventory turnover increased from 1.23 to 3.85. This indicates that the company has been able to sell and replace its inventory almost four times during the most recent period. The increasing trend in the inventory turnover ratio suggests that Ingersoll Rand Inc has been able to manage its inventory levels effectively, potentially reducing carrying costs and minimizing the risk of obsolescence.

Overall, the improving inventory turnover ratio reflects positively on Ingersoll Rand Inc's operational efficiency and ability to meet customer demand while effectively managing its inventory levels. A high inventory turnover ratio also signifies that the company is likely generating more sales from its existing inventory, which can lead to improved profitability and cash flow.