Microchip Technology Inc (MCHP)

Days of inventory on hand (DOH)

		Mar 31, 2025	Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Inventory turnover		1.49	2.01	2.07	2.78	3.10
DOH	days	244.16	182.04	176.44	131.51	117.85

March 31, 2025 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 1.49
= 244.16

The days of inventory on hand (DOH) for Microchip Technology Inc have shown an increasing trend over the years, indicating a longer time period for the company to sell its inventory.

As of March 31, 2023, the DOH stood at 176.44 days, representing a significant increase from the DOH of 117.85 days reported on March 31, 2021. This suggests that Microchip Technology Inc may be carrying excess inventory or facing challenges in efficiently managing its inventory levels.

Furthermore, the DOH continued to rise to 182.04 days as of March 31, 2024, and further increased to 244.16 days by March 31, 2025. These elevated DOH figures may raise concerns regarding potential liquidity issues or slower inventory turnover for the company.

It is essential for Microchip Technology Inc to closely monitor and optimize its inventory management processes to prevent excess inventory buildup and improve operational efficiency. Strategies such as implementing just-in-time inventory systems or conducting regular inventory assessments could help the company in reducing its DOH and enhancing overall inventory turnover.