Zoetis Inc (ZTS)

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	5,245,000	5,218,000	5,131,000	5,050,000	4,964,000	4,863,000	4,800,000	4,780,000	4,706,000	4,717,000	4,701,000	4,615,000	4,544,000	4,496,000	4,380,000	4,177,000	4,074,000	3,971,000	3,875,000	3,834,000
Inventory	US$ in thousands	2,306,000	2,416,000	2,452,000	2,651,000	2,564,000	2,744,000	2,701,000	2,563,000	2,345,000	2,303,000	2,205,000	2,057,000	1,923,000	1,875,000	1,802,000	1,700,000	1,628,000	1,626,000	1,584,000	1,481,000
Inventory turnover		2.27	2.16	2.09	1.90	1.94	1.77	1.78	1.87	2.01	2.05	2.13	2.24	2.36	2.40	2.43	2.46	2.50	2.44	2.45	2.59

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $5,245,000K ÷ $2,306,000K
= 2.27

The inventory turnover of Zoetis Inc has exhibited a declining trend over the past few years, indicating a longer time it takes for the company to sell its inventory. From March 31, 2020, to December 31, 2022, the inventory turnover decreased from 2.59 to 2.01, reflecting a reduction in sales relative to the level of inventory held during this period.

However, there was a slight uptick in inventory turnover from March 31, 2023, to June 30, 2024, with the ratio ranging from 1.78 to 2.27. This improvement suggests that Zoetis Inc has been more efficient in managing its inventory levels, leading to a quicker turnover and potentially a better alignment between inventory and sales.

Overall, it is essential for Zoetis Inc to closely monitor its inventory turnover to ensure optimal inventory management practices that facilitate better liquidity and profitability. A consistently low or declining inventory turnover may indicate inefficiencies in inventory management or challenges in selling products, which could impact the company's financial performance in the long run.