Urban Outfitters Inc (URBN)

Inventory turnover

		Jan 31, 2025	Jan 31, 2024	Jan 31, 2023	Jan 31, 2022	Jan 31, 2021
Cost of revenue	US$ in thousands	3,624,000	3,425,960	3,368,030	3,054,810	2,587,840
Inventory	US$ in thousands	621,146	550,242	587,510	569,699	389,618
Inventory turnover		5.83	6.23	5.73	5.36	6.64

January 31, 2025 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $3,624,000K ÷ $621,146K
= 5.83

Based on the provided data, Urban Outfitters Inc's inventory turnover ratio has shown some variability over the past five years. The inventory turnover ratio measures how efficiently a company manages its inventory by showing how many times the company's inventory is sold and replaced during a specific period.

In January 31, 2021, the inventory turnover ratio was 6.64, indicating that Urban Outfitters Inc was able to sell and replace its inventory approximately 6.64 times during that year. This suggests a relatively efficient management of inventory.

However, the inventory turnover ratio decreased in the following years, reaching 5.36 in January 31, 2022, 5.73 in January 31, 2023, and 5.83 in January 31, 2025. These lower ratios may indicate that the company was holding onto its inventory for longer periods, which could tie up its working capital and lead to potential obsolescence or carrying costs.

In January 31, 2024, there was a slight improvement in the inventory turnover ratio to 6.23, suggesting a better management of inventory that year.

Overall, Urban Outfitters Inc's inventory turnover has shown some fluctuation over the years, with a general trend towards a lower ratio. This may warrant further investigation into the company's inventory management practices to ensure optimal efficiency and cost-effectiveness.