L3Harris Technologies Inc (LHX)

Inventory turnover

		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	Sep 30, 2019
Cost of revenue (ttm)	US$ in thousands	20,206,000	19,843,000	19,283,000	18,412,000	17,723,000	17,735,000	17,071,000	16,609,000	16,819,000	15,912,000	16,472,000	16,875,000	29,521,000	30,127,000	30,261,000	30,693,000	17,047,000	14,300,000	10,951,000	7,463,000
Inventory	US$ in thousands	1,399,000	1,432,000	1,476,000	1,472,000	1,638,000	1,555,000	1,541,000	1,291,000	1,339,000	1,241,000	1,090,000	982,000	1,024,000	872,000	904,000	973,000	894,000	859,000	990,000	1,339,000
Inventory turnover		14.44	13.86	13.06	12.51	10.82	11.41	11.08	12.87	12.56	12.82	15.11	17.18	28.83	34.55	33.47	31.54	19.07	16.65	11.06	5.57

September 30, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $20,206,000K ÷ $1,399,000K
= 14.44

The inventory turnover ratio for L3Harris Technologies Inc has shown a fluctuating trend over the past few years. The ratio has generally been increasing over time, indicating that the company is managing its inventory more efficiently.

In the most recent period ending September 30, 2024, the inventory turnover ratio stood at 14.44 times, which means that the company sold and replaced its inventory approximately 14.44 times during that period. This signifies that L3Harris is able to sell its inventory quickly and efficiently, reducing the risk of inventory obsolescence and associated holding costs.

The ratio has been steadily improving since the beginning of 2021, with a significant spike in inventory turnover seen in the quarters ending December 31, 2021, and March 31, 2022, with ratios of 28.83 and 34.55 respectively. This high turnover indicates strong demand for the company's products during those periods.

Overall, the increasing trend in inventory turnover for L3Harris Technologies Inc reflects effective inventory management practices, which can lead to improved cash flow, profitability, and a stronger financial position for the company. The recent ratio of 14.44 demonstrates efficient management of inventory levels, ensuring that the company can meet customer demand while minimizing holding costs and potential losses from obsolete inventory.