Stryker Corporation (SYK)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	8,155,000	7,440,000	6,871,000	6,140,000	5,294,000
Inventory	US$ in thousands	4,774,000	4,843,000	3,995,000	3,314,000	3,494,000
Inventory turnover		1.71	1.54	1.72	1.85	1.52

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $8,155,000K ÷ $4,774,000K
= 1.71

Inventory turnover, a key efficiency ratio, measures how many times a company's inventory is sold and replaced over a certain period. For Stryker Corporation, the inventory turnover for the years ending December 31 shows a fluctuating trend.

In 2020, the inventory turnover was 1.52, indicating that the company's inventory took approximately 1.52 years to be sold and replaced. The ratio improved in 2021 to 1.85, suggesting that Stryker managed its inventory more efficiently, turning it over more frequently.

However, in 2022, the inventory turnover decreased to 1.72, but it still remained relatively stable. This could indicate a slight slowdown in inventory management efficiency compared to the previous year.

The ratio further declined in 2023 to 1.54, suggesting that the company took longer to sell and replace its inventory compared to the previous years.

Finally, in 2024, the inventory turnover increased to 1.71, albeit not reaching the highest point seen in 2021. This rebound may indicate an improvement in managing inventory during that year.

Overall, while the inventory turnover ratio for Stryker Corporation has shown some fluctuations, it is essential for the company to continually monitor and improve inventory management practices to ensure optimal efficiency and profitability.