Teradyne Inc (TER)

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	1,139,550	1,159,881	1,196,134	1,248,566	1,287,894	1,334,506	1,372,312	1,476,674	1,496,225	1,447,407	1,428,463	1,356,912	1,335,729	1,297,961	1,174,405	1,047,477	955,136	893,747	889,902	869,237
Inventory	US$ in thousands	309,974	322,632	347,295	352,058	325,019	310,754	295,625	259,341	243,330	224,242	226,138	262,474	222,189	191,317	206,088	182,978	196,691	178,203	164,461	161,342
Inventory turnover		3.68	3.60	3.44	3.55	3.96	4.29	4.64	5.69	6.15	6.45	6.32	5.17	6.01	6.78	5.70	5.72	4.86	5.02	5.41	5.39

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $1,139,550K ÷ $309,974K
= 3.68

Teradyne, Inc.'s inventory turnover has shown some fluctuations over the past eight quarters. The inventory turnover ratio measures the efficiency of a company in managing its inventory levels. A higher turnover ratio generally indicates that the company is selling its inventory more quickly.

Looking at the trend, the inventory turnover ratio has been declining slightly from 5.69 in Q1 2022 to 3.68 in Q4 2023. This decline suggests that Teradyne may be taking longer to sell its inventory or holding higher levels of inventory compared to the previous periods.

A lower inventory turnover ratio may indicate potential issues such as overstocking, slowing sales, or obsolete inventory. It could also suggest inefficiencies in inventory management and procurement processes.

Teradyne may need to evaluate its inventory management practices to enhance efficiency and reduce carrying costs associated with excess inventory. Regular monitoring and adjustments to inventory levels, sales forecasts, and production schedules may help improve the inventory turnover ratio and overall operational performance.