Monolithic Power Systems Inc (MPWR)

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	986,230	911,862	846,512	813,112	799,953	789,267	782,457	779,047	745,596	696,023	628,718	567,777	522,339	483,878	463,049	417,563	378,498	349,131	308,404	288,145
Inventory	US$ in thousands	419,611	424,942	426,751	395,990	383,702	397,288	427,432	430,830	447,290	397,435	359,647	311,040	259,417	208,062	177,322	175,223	157,062	148,096	152,119	131,499
Inventory turnover		2.35	2.15	1.98	2.05	2.08	1.99	1.83	1.81	1.67	1.75	1.75	1.83	2.01	2.33	2.61	2.38	2.41	2.36	2.03	2.19

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $986,230K ÷ $419,611K
= 2.35

Monolithic Power Systems Inc's inventory turnover has fluctuated over the past few years, indicating varying efficiency in managing its inventory levels. The inventory turnover ratio is a measure of how many times a company sells and replaces its inventory during a certain period.

In the recent quarters, the inventory turnover ratio has been declining gradually from 2.19 in March 2020 to 1.98 in June 2024. This trend suggests that the company is taking longer to turn over its inventory, which could indicate potential issues such as overstocking, slow-moving inventory, or inefficiencies in the supply chain.

However, despite the general decreasing trend, there have been short-term peaks in the ratio, such as in September 2021 and December 2024, where the ratio increased to 2.33 and 2.35, respectively. These spikes may indicate temporary improvements in inventory management or an increase in sales efficiency during those periods.

Overall, Monolithic Power Systems Inc's inventory turnover ratio has shown some variability, and it would be important for the company to closely monitor and address any factors affecting its inventory turnover to ensure optimal inventory management in the future.