Verra Mobility Corp (VRRM)

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	86,473	119,577	126,213	96,559	69,695	41,915	45,362	47,101	47,262	53,234	48,576	44,013	35,146	24,749	21,941	24,538	33,540	32,635	33,266	27,724
Inventory	US$ in thousands	15,502	18,708	17,165	17,298	20,288	19,943	19,791	18,923	19,307	17,922	16,549	15,451	12,093	34,976	33,799	23,696	633	23,696	19,225	25,675
Inventory turnover		5.58	6.39	7.35	5.58	3.44	2.10	2.29	2.49	2.45	2.97	2.94	2.85	2.91	0.71	0.65	1.04	52.99	1.38	1.73	1.08

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $86,473K ÷ $15,502K
= 5.58

Inventory turnover measures how efficiently a company is managing its inventory by showing the number of times a company sells and replaces its inventory during a specific period. A high inventory turnover indicates that the company is selling its inventory quickly, while a low turnover suggests slow-moving inventory or overstocking.

Based on the data provided for Verra Mobility Corp, we can observe fluctuations in its inventory turnover ratio over various quarters. The inventory turnover ratio was relatively low in the initial quarters, ranging from 1.04 to 1.73, indicating slower inventory movement. However, there was a significant spike in the ratio to 52.99 in December 31, 2020, which could suggest a sudden increase in sales or a more efficient inventory management strategy during that period.

Subsequently, the inventory turnover ratio fluctuated between 0.65 and 2.97 in the following quarters, indicating some variability in managing inventory turnover. In recent quarters, the inventory turnover ratio has stabilized between 2.10 and 7.35, suggesting a more consistent approach to inventory management.

Overall, it is essential for Verra Mobility Corp to monitor its inventory turnover ratio continually to ensure that it maintains an optimal level of inventory that aligns with its sales volume. A balance between stocking enough inventory to meet demand and avoiding overstocking is crucial for the company's financial health and operational efficiency.