Ulta Beauty Inc (ULTA)

Inventory turnover

		Jan 31, 2025	Oct 31, 2024	Jul 31, 2024	Apr 30, 2024	Feb 3, 2024	Jan 31, 2024	Oct 31, 2023	Oct 28, 2023	Jul 31, 2023	Jul 29, 2023	Apr 30, 2023	Apr 29, 2023	Jan 31, 2023	Jan 28, 2023	Oct 31, 2022	Oct 29, 2022	Jul 31, 2022	Jul 30, 2022	Apr 30, 2022	Jan 31, 2022
Cost of revenue (ttm)	US$ in thousands	6,908,410	6,968,170	7,657,440	7,580,400	7,421,200	6,743,670	6,066,140	6,148,680	6,231,220	6,709,290	7,187,360	6,983,930	6,780,500	6,135,180	5,489,860	5,518,760	5,844,840	6,177,950	6,015,300	5,816,720
Inventory	US$ in thousands	1,968,210	2,365,190	1,998,290	1,906,040	1,696,780	1,742,140	2,321,310	2,321,310	1,815,540	1,815,540	1,751,240	1,751,240	1,603,450	1,563,920	2,114,670	2,114,670	1,666,130	1,666,130	1,570,550	1,499,220
Inventory turnover		3.51	2.95	3.83	3.98	4.37	3.87	2.61	2.65	3.43	3.70	4.10	3.99	4.23	3.92	2.60	2.61	3.51	3.71	3.83	3.88

January 31, 2025 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $6,908,410K ÷ $1,968,210K
= 3.51

Ulta Beauty Inc's inventory turnover has fluctuated over the past few years. The inventory turnover ratio measures how many times a company sells and replaces its inventory over a specific period.

Analyzing the provided data, we can see that the inventory turnover ratio for Ulta Beauty Inc ranged from a low of 2.60 in October 2022 to a high of 4.37 in February 2024. Generally, a higher inventory turnover ratio indicates that the company is selling its inventory more frequently, which is seen as a positive sign of efficiency.

However, it is important to note that a very high inventory turnover ratio could also indicate potential stockouts or pricing issues. Conversely, a lower inventory turnover ratio could suggest overstocking or slow-moving inventory, which may tie up capital and increase carrying costs.

Overall, a consistent and optimal inventory turnover ratio is essential for managing cash flow, reducing carrying costs, and ensuring efficient inventory management at Ulta Beauty Inc.