Liquidity Services Inc (LQDT)

Inventory turnover

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Cost of revenue	US$ in thousands	269,016	223,717	194,785	176,948	162,585
Inventory	US$ in thousands	17,099	11,116	11,679	12,468	5,607
Inventory turnover		15.73	20.13	16.68	14.19	29.00

September 30, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $269,016K ÷ $17,099K
= 15.73

Inventory turnover is a critical financial ratio that measures how many times a company's inventory is sold and replaced during a specific period. A higher inventory turnover ratio indicates that a company efficiently manages its inventory by quickly selling and replenishing stock. Liquidity Services Inc's inventory turnover has fluctuated over the past five years, with values of 15.73 in 2024, 20.13 in 2023, 16.68 in 2022, 14.19 in 2021, and 29.00 in 2020.

The significant decrease in inventory turnover in 2021 compared to 2020 suggests potential inefficiencies in managing inventory levels or variations in demand that impacted sales. However, the inventory turnover ratio rebounded in 2022 and remained relatively stable in 2023 and 2024, indicating improved inventory management practices.

Overall, Liquidity Services Inc's inventory turnover ratios demonstrate varying levels of efficiency in inventory management over the past five years, with notable improvements in recent years. Further analysis and comparison with industry benchmarks can provide additional insights into the company's inventory management performance.