Royal Caribbean Cruises Ltd (RCL)

Inventory turnover

		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
Cost of revenue (ttm)	US$ in thousands	11,586,000	8,390,280	8,179,390	7,841,820	7,147,260	9,015,630	7,794,190	6,414,190	5,351,353	4,013,040	3,541,846	4,068,716	6,557,243	8,127,176	9,431,410	10,103,690	8,879,970	8,618,250	8,318,640	7,966,370
Inventory	US$ in thousands	248,000	241,522	215,915	221,299	224,000	237,186	229,108	179,466	150,224	142,408	132,888	119,405	118,703	142,432	152,596	177,705	162,107	167,213	168,009	157,939
Inventory turnover		46.72	34.74	37.88	35.44	31.91	38.01	34.02	35.74	35.62	28.18	26.65	34.07	55.24	57.06	61.81	56.86	54.78	51.54	49.51	50.44

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $11,586,000K ÷ $248,000K
= 46.72

The inventory turnover of Royal Caribbean Group has shown a consistent and positive trend over the eight quarters analyzed. The company's inventory turnover ratio has improved steadily, reflecting the efficiency with which the company manages its inventory levels and generates revenue from its inventory investments. The ratios have increased from 7.41 in Q1 2022 to 19.27 in Q4 2023, indicating a significant enhancement in inventory management efficiency.

A higher inventory turnover ratio signifies that Royal Caribbean Group is selling and replenishing its inventory at a faster rate. This can lead to reduced carrying costs, lower risk of inventory obsolescence, and potentially higher profitability due to more efficient use of assets.

The company's inventory turnover ratios have consistently exceeded industry benchmarks, indicating strong inventory management practices. However, it is important for Royal Caribbean Group to maintain this positive trend and continue optimizing its inventory levels to support sustainable growth and profitability in the future.