Synopsys Inc (SNPS)

Inventory turnover

		Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
Cost of revenue	US$ in thousands	1,222,190	1,063,700	861,777	794,690	752,946
Inventory	US$ in thousands	325,590	211,927	229,023	192,333	141,518
Inventory turnover		3.75	5.02	3.76	4.13	5.32

October 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $1,222,190K ÷ $325,590K
= 3.75

The inventory turnover ratio measures the number of times a company's inventory is sold and replaced over a specific period. Synopsys, Inc.'s inventory turnover has fluctuated over the past five years. In 2023, the inventory turnover ratio was 3.75, indicating that the company's inventory was sold and replaced approximately 3.75 times during the year. This represents a decrease from the previous year's ratio of 5.02. The decrease may suggest that Synopsys, Inc. has experienced challenges in managing its inventory efficiently, potentially leading to excess inventory or slow-moving stock. However, it is essential to consider the context of the industry and the company's specific operations when interpreting this ratio. Further analysis of the inventory management practices and industry dynamics would provide a comprehensive understanding of Synopsys, Inc.'s inventory turnover performance.