Northrop Grumman Corporation (NOC)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 4,049,000 | 4,094,000 | 4,115,000 | 4,774,000 | 4,680,000 |
| Inventory | US$ in thousands | 1,455,000 | 1,109,000 | 978,000 | 811,000 | 759,000 |
| Inventory turnover | 2.78 | 3.69 | 4.21 | 5.89 | 6.17 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $4,049,000K ÷ $1,455,000K
= 2.78
The inventory turnover ratio for Northrop Grumman Corporation has exhibited a downward trend over the period from December 31, 2020, to December 31, 2024. In December 2020, the inventory turnover stood at 6.17, indicating that the company's inventory was sold and replenished approximately 6.17 times during the year. However, by December 2024, the inventory turnover had decreased to 2.78, suggesting a decline in the efficiency of inventory management.
A decreasing inventory turnover ratio can signify potential issues such as overstocking, obsolete inventory, or slowing sales. It may also indicate challenges in matching production levels with demand fluctuations. The declining trend in inventory turnover should alert stakeholders to potential inefficiencies in the company's operations, highlighting the need for closer monitoring and potential corrective actions to optimize inventory levels and improve overall efficiency.
Peer comparison
Dec 31, 2024