Wolfspeed Inc (WOLF)

Inventory turnover

		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	Dec 31, 2019	Sep 30, 2019
Cost of revenue (ttm)	US$ in thousands	977,000	955,800	942,900	902,500	882,100	849,400	805,100	766,300	708,900	604,700	569,800	537,300	703,300	756,200	819,200	917,200	820,200	827,800	1,061,922	1,189,448
Inventory	US$ in thousands	440,700	421,200	370,200	340,900	284,900	288,900	266,600	241,800	227,000	219,400	198,600	183,000	166,600	147,500	144,300	187,300	121,900	170,100	165,300	182,900
Inventory turnover		2.22	2.27	2.55	2.65	3.10	2.94	3.02	3.17	3.12	2.76	2.87	2.94	4.22	5.13	5.68	4.90	6.73	4.87	6.42	6.50

June 30, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $977,000K ÷ $440,700K
= 2.22

The inventory turnover ratio of Wolfspeed Inc has fluctuated over the past few quarters. The ratio indicates how many times the company's inventory is sold and replaced in a given period. A higher inventory turnover generally suggests efficient inventory management.

From December 2019 to June 2021, Wolfspeed Inc experienced a consistent increase in its inventory turnover ratio, reaching a peak of 5.68 in March 2021. This trend implies that the company was effectively managing its inventory levels, turning over its inventory multiple times within a year.

However, from September 2021 onwards, the inventory turnover ratio started to decline, indicating a decrease in the efficiency of inventory management. The ratio dropped to 2.22 in June 2024, reflecting a slowdown in inventory turnover.

It is essential for Wolfspeed Inc to closely monitor its inventory levels and sales to improve its inventory turnover ratio to ensure optimal utilization of resources and maintain healthy liquidity.