Waters Corporation (WAT)

Inventory turnover

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cost of revenue (ttm)	US$ in thousands	1,165,932	1,179,017	1,114,162	814,184	1,063,582	1,065,385	1,051,680	1,075,765	1,030,115	987,702	968,828	1,164,402	925,954	885,419	874,025	888,784	875,388	864,642	864,603	867,040
Inventory	US$ in thousands	516,236	544,402	536,828	499,422	455,710	442,236	409,922	381,902	356,095	388,756	348,770	327,967	304,281	326,946	344,009	344,009	320,551	368,790	351,552	333,308
Inventory turnover		2.26	2.17	2.08	1.63	2.33	2.41	2.57	2.82	2.89	2.54	2.78	3.55	3.04	2.71	2.54	2.58	2.73	2.34	2.46	2.60

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $1,165,932K ÷ $516,236K
= 2.26

Waters Corp.'s inventory turnover has exhibited a declining trend over the last two years, with the ratio decreasing from 3.11 in Q1 2022 to 2.32 in Q4 2023. This indicates that the company is taking longer to sell through its inventory.

A lower inventory turnover ratio could imply potential issues such as overstocking, slow-moving inventory, or decreasing demand for the company's products. It may also suggest inefficient inventory management practices, leading to higher carrying costs and potentially affecting profitability.

It is essential for Waters Corp. to closely monitor and address the factors influencing its inventory turnover to optimize its working capital management and enhance operational efficiency. Further analysis and comparison with industry benchmarks could provide valuable insights into the company's inventory performance and potential areas for improvement.