TransMedics Group Inc (TMDX)

Inventory turnover

		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
Cost of revenue (ttm)	US$ in thousands	179,659	163,298	141,150	111,730	87,530	64,952	46,752	37,199	28,187	20,197	14,226	10,637	9,103	9,220	9,676	8,576	9,004	8,521	9,457	10,308
Inventory	US$ in thousands	46,554	52,152	48,671	48,541	44,235	39,365	30,545	23,961	20,605	18,575	17,468	16,714	14,859	14,869	13,007	11,820	11,934	12,984	12,555	11,361
Inventory turnover		3.86	3.13	2.90	2.30	1.98	1.65	1.53	1.55	1.37	1.09	0.81	0.64	0.61	0.62	0.74	0.73	0.75	0.66	0.75	0.91

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $179,659K ÷ $46,554K
= 3.86

TransMedics Group Inc's inventory turnover ratio has shown a fluctuating trend over the past few years. The ratio has gradually increased from 0.91 in March 2020 to 3.86 in December 2024. A low inventory turnover ratio indicates that the company is holding onto its inventory for a longer period before selling it, which may tie up capital and increase storage costs. On the other hand, a higher inventory turnover ratio suggests that the company is efficiently managing its inventory by quickly converting it into sales.

The significant improvement in the inventory turnover ratio from 2020 to 2024 indicates that TransMedics Group Inc has been able to streamline its inventory management processes and enhance operational efficiency. This may result in better utilization of resources, improved cash flow, and potentially higher profitability. However, a very high inventory turnover ratio could also indicate understocking issues, leading to potential stockouts and missed sales opportunities.

Overall, the increasing trend in TransMedics Group Inc's inventory turnover ratio is a positive indicator of the company's ability to efficiently manage its inventory levels and optimize its working capital.