Eli Lilly and Company (LLY)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	17,963,900	14,596,700	13,521,600	14,399,600	11,912,100
Inventory	US$ in thousands	7,589,200	5,772,800	4,309,700	3,886,000	3,980,300
Inventory turnover		2.37	2.53	3.14	3.71	2.99

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $17,963,900K ÷ $7,589,200K
= 2.37

The inventory turnover ratio for Eli Lilly and Company has shown some variability over the past five years. It increased from 2.99 in December 2020 to 3.71 in December 2021, indicating that the company was able to sell its inventory more efficiently during that period. However, the ratio decreased in the following years, reaching 2.37 by December 31, 2024. This downward trend suggests that the company may have experienced challenges in managing its inventory levels or in swiftly converting inventory into sales in the latter part of the period. Overall, a higher inventory turnover ratio is generally preferred as it indicates that the company is selling its products quickly, but it is important to assess this ratio in conjunction with other financial metrics to gain a more comprehensive understanding of Eli Lilly's operational performance.