Power Integrations Inc (POWI)

Days of inventory on hand (DOH)

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Inventory turnover		1.32	1.53	1.59	1.79	2.10	2.55	2.90	3.25	3.45	3.70	3.53	3.10	2.38	2.14	2.10	2.24	2.29	2.21	2.17	2.30
DOH	days	276.25	238.75	229.33	203.81	173.90	143.11	125.67	112.42	105.74	98.61	103.42	117.62	153.44	170.57	173.48	162.74	159.16	164.92	168.35	158.97

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 1.32
= 276.25

Days of Inventory on Hand (DOH) for Power Integrations Inc. has shown a consistent upward trend over the past eight quarters, indicating an increasing amount of time it takes for the company to turn its inventory into sales.

In Q1 2022, the DOH stood at 112.42 days, and it has steadily risen to 276.25 days by Q4 2023. This suggests a significant deterioration in the management of inventory levels, with the company carrying more inventory relative to its sales.

A higher DOH value may imply inefficiencies in inventory management, such as overstocking or slowing sales, leading to potential risks like inventory obsolescence, storage costs, and cash flow constraints. Power Integrations Inc. may need to reassess its inventory policies and supply chain management to optimize inventory turnover and reduce the risk associated with excessive inventory levels.