Intuitive Surgical Inc (ISRG)

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	4,874,600	4,710,700	4,566,000	4,451,800	4,378,700	4,201,600	4,117,300	3,987,400	3,793,900	3,671,400	3,523,600	3,398,200	3,245,400	2,324,800	2,188,200	2,030,900	1,991,100	1,991,300	1,953,000	1,931,400
Inventory	US$ in thousands	1,487,200	1,481,700	1,383,900	1,299,300	1,220,600	1,147,500	1,005,200	946,600	893,200	837,100	724,000	653,000	587,100	584,900	569,700	576,800	601,500	662,900	645,500	620,300
Inventory turnover		3.28	3.18	3.30	3.43	3.59	3.66	4.10	4.21	4.25	4.39	4.87	5.20	5.53	3.97	3.84	3.52	3.31	3.00	3.03	3.11

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $4,874,600K ÷ $1,487,200K
= 3.28

The inventory turnover ratio measures how efficiently a company is managing its inventory by showing how many times the company's inventory is sold and replaced over a specific period. A higher inventory turnover ratio indicates more efficient inventory management.

Looking at the inventory turnover for Intuitive Surgical Inc from March 31, 2020, to December 31, 2024, we can see a fluctuating trend. The ratio started at 3.11 on March 31, 2020, and steadily increased to a peak of 5.53 on December 31, 2021. This significant improvement suggests that the company was able to sell and replace its inventory more frequently during this period.

However, the inventory turnover ratio started to decline after December 31, 2021, and reached 3.59 by the end of December 31, 2023. This downward trend indicates that the company may have experienced challenges in managing its inventory efficiently during this period.

By the end of March 31, 2024, the inventory turnover ratio slightly decreased to 3.43. Although it is lower than the peak in 2021, it is still higher than the 2020 levels, indicating that the company has made some improvements in its inventory management compared to the initial period.

Overall, while there have been fluctuations in Intuitive Surgical Inc's inventory turnover ratio over the years, the company has demonstrated the ability to improve its inventory management efficiency at times but also faced challenges in other periods. Monitoring this ratio can provide insights into the company's operational performance and efficiency in managing its inventory.