Silicon Laboratories Inc (SLAB)

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	321,672	378,781	398,278	396,434	381,549	362,370	333,460	307,407	295,468	276,513	258,438	233,015	252,623	143,197	175,154	207,043	193,571	326,394	331,806	337,960
Inventory	US$ in thousands	194,295	167,581	145,523	133,236	100,417	88,447	74,026	55,515	49,307	59,114	52,269	79,244	47,861	66,159	70,022	68,160	73,057	71,453	73,865	70,489
Inventory turnover		1.66	2.26	2.74	2.98	3.80	4.10	4.50	5.54	5.99	4.68	4.94	2.94	5.28	2.16	2.50	3.04	2.65	4.57	4.49	4.79

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $321,672K ÷ $194,295K
= 1.66

Inventory turnover is a key financial ratio that measures how efficiently a company is managing its inventory levels. It indicates how many times a company's inventory is sold and replaced over a specific period. A higher inventory turnover ratio is generally considered favorable as it suggests that the company is selling its products quickly and efficiently.

Analyzing the inventory turnover of Silicon Laboratories Inc over the past few quarters reveals fluctuations in the efficiency of managing its inventory. The inventory turnover ratio has shown a downward trend from the end of 2022 to the end of 2023, decreasing from 4.57 to 1.66. This decline indicates that Silicon Laboratories Inc is taking longer to sell its inventory compared to the earlier periods.

It is worth noting that the inventory turnover ratio experienced significant fluctuations, with peaks observed in the first quarter of 2022 (5.54) and in the third quarter of 2022 (4.79). These peaks might indicate that the company had successfully optimized its inventory management during those periods.

Overall, the trend in Silicon Laboratories Inc's inventory turnover suggests fluctuations in the efficiency of managing its inventory levels. Further analysis and comparison with industry averages may provide insights into whether the company is effectively balancing its inventory levels with customer demand.