Texas Instruments Incorporated (TXN)

Days of inventory on hand (DOH)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Inventory turnover		1.45	1.63	2.27	3.12	2.66
DOH	days	252.38	224.56	160.83	116.81	137.44

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 1.45
= 252.38

Texas Instruments Incorporated's days of inventory on hand (DOH) has shown an increasing trend over the years. In December 2020, the DOH was at 137.44 days, which decreased to 116.81 days by December 2021, indicating a reduction in the time it takes for the company to sell its inventory. However, this trend reversed in the following years, with the DOH increasing significantly to 160.83 days by December 2022, 224.56 days by December 2023, and 252.38 days by December 2024.

The substantial increase in DOH from 2022 onwards may suggest potential issues related to inventory management efficiency. A higher DOH value means that the company is taking longer to sell its inventory, which could lead to increased holding costs, risk of obsolescence, and potential liquidity challenges if inventory cannot be converted into cash quickly.

It would be advisable for Texas Instruments to closely monitor and streamline its inventory management processes to improve operational efficiency, reduce holding costs, and ensure optimal utilization of resources. Regular evaluation and adjustment of inventory levels and sales strategies may help in maintaining a balanced level of inventory turnover and improving overall financial performance.