SPS Commerce Inc (SPSC)

Days of inventory on hand (DOH)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Inventory turnover		—	—	—	—	—	2.93	2.98	2.98	2.90	2.94	—	2.94	2.96	2.96	2.83	2.75	2.66	2.65	2.66	2.66
DOH	days	—	—	—	—	—	124.46	122.46	122.34	125.80	124.22	—	124.36	123.43	123.46	128.92	132.81	137.11	137.83	137.48	137.40

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ —
= —

Days of inventory on hand (DOH) is a financial ratio used to measure the average number of days a company holds its inventory before selling it. A lower DOH value indicates that a company is selling its inventory quickly, while a higher value suggests slower turnover and potential inventory management issues.

Analyzing the data provided for SPS Commerce Inc, we can observe fluctuations in the company's DOH over the past few years:

- From March 31, 2020, to March 31, 2021, the DOH decreased from 137.40 days to 132.81 days, indicating a slight improvement in inventory turnover.
- A further decrease was seen by June 30, 2021, with DOH dropping to 128.92 days, suggesting more efficient inventory management.
- The trend continued with DOH reaching its lowest point on September 30, 2021, at 123.46 days, indicating a significant improvement in inventory turnover efficiency.
- However, there was a slight increase by December 31, 2021, and the DOH fluctuated around this level in the following periods.

Overall, the company has shown varying levels of effectiveness in managing its inventory turnover, with fluctuations in DOH over the years. It is essential for SPS Commerce Inc to monitor its inventory levels closely to optimize its working capital and enhance operational efficiency.