Weatherford International PLC (WFRD)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 235,000 | 463,000 | 313,000 | 320,000 | 1,906,000 |
| Inventory | US$ in thousands | 880,000 | 788,000 | 689,000 | 670,000 | 717,000 |
| Inventory turnover | 0.27 | 0.59 | 0.45 | 0.48 | 2.66 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $235,000K ÷ $880,000K
= 0.27
Weatherford International PLC's inventory turnover has shown a declining trend over the last five years. Starting at a robust level of 2.66 in December 2020, the inventory turnover ratio dropped significantly to 0.48 by December 2021. This downward trend continued with further decreases to 0.45 in December 2022 and 0.27 in December 2024.
A low inventory turnover ratio indicates that the company is holding onto its inventory for a longer period, which can be a sign of inefficiency in managing inventory levels or potential issues in demand forecasting.
It is crucial for Weatherford International PLC to closely monitor and improve its inventory management practices to optimize the utilization of its resources and enhance overall operational efficiency. Actions such as implementing better inventory control systems, revising procurement strategies, or reassessing production planning may help in addressing the challenges reflected in the declining inventory turnover ratios.
Peer comparison
Dec 31, 2024