Synaptics Incorporated (SYNA)

Inventory turnover

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Cost of revenue	US$ in thousands	593,900	519,600	639,200	796,600	728,400
Inventory	US$ in thousands	139,500	114,000	137,200	169,700	82,000
Inventory turnover		4.26	4.56	4.66	4.69	8.88

June 30, 2025 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $593,900K ÷ $139,500K
= 4.26

The inventory turnover ratio for Synaptics Incorporated exhibits a notable downward trend over the analyzed period from June 30, 2021, through June 30, 2025. Specifically, the ratio declined from 8.88 times in fiscal year 2021 to approximately 4.26 times in fiscal year 2025. This represents a decrease of roughly 52% over four years.

Initially, the high inventory turnover of 8.88 indicates that the company was able to efficiently sell and replace its inventory more than eight times during the 2021 fiscal year, suggesting robust sales activity and effective inventory management at that time. However, the subsequent decline to 4.69 in fiscal 2022 and further to 4.66 in fiscal 2023 signifies a significant reduction in inventory turnover efficiency. This decline persisted into fiscal 2024 and 2025, with ratios of 4.56 and 4.26 respectively, indicating a trend toward slower inventory movement.

The decrease in inventory turnover ratio could be attributable to several factors. It may reflect a potential buildup of inventory levels, reduced sales velocity, or shifts in inventory management strategies, such as increased safety stock or strategic on-hand inventory to mitigate supply chain risks. Alternatively, it could suggest changing product demand dynamics or competitive pressures affecting sales.

Overall, the declining inventory turnover ratio over the observed period points to a deterioration in inventory management efficiency or reduced sales activity. While lower turnover may sometimes indicate increased inventory stockpiles or reaction to external market conditions, it warrants further investigation into the company’s sales trends, inventory policies, and market environment to determine the underlying causes and implications for operational performance.