Analysis of Inventory
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- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Balance Sheet: Assets
- Analysis of Liquidity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Reportable Segments
- Present Value of Free Cash Flow to Equity (FCFE)
- Current Ratio since 2005
- Debt to Equity since 2005
- Price to Sales (P/S) since 2005
- Aggregate Accruals
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Inventory Disclosure
International Business Machines Corp., balance sheet: inventory
US$ in millions
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Finished goods | |||||||||||
| Work in process and raw materials | |||||||||||
| Inventory |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
Inventory levels experienced fluctuations over the five-year period. A general decreasing trend is apparent when considering total inventory, though with notable variations in the composition between finished goods and work in process/raw materials.
- Finished Goods
- The value of finished goods decreased significantly from 2021 to 2023, falling from US$208 million to US$78 million. A subsequent increase occurred in 2024, reaching US$134 million, followed by a further rise to US$230 million in 2025. This suggests potential shifts in production strategies, demand fulfillment, or supply chain dynamics impacting the availability of completed products.
- Work in Process and Raw Materials
- Work in process and raw materials exhibited a more moderate decline from US$1,441 million in 2021 to US$1,083 million in 2023. Values increased to US$1,155 million in 2024 before decreasing again to US$990 million in 2025. This component represents the largest portion of total inventory and its fluctuations likely reflect changes in production volume and material costs.
- Total Inventory
- Total inventory decreased from US$1,649 million in 2021 to US$1,161 million in 2023. A modest recovery was observed in 2024, with inventory reaching US$1,289 million, followed by a slight decrease to US$1,220 million in 2025. The overall trend indicates a reduction in the company’s investment in inventory, potentially driven by improved inventory management practices or a change in business strategy.
The contrasting trends in finished goods and work in process/raw materials suggest a possible decoupling of production and sales. The increase in finished goods in the later years, coupled with a decrease in work in process and raw materials, could indicate an effort to meet demand with existing stock rather than ramping up production. Further investigation into sales figures and production costs would be necessary to confirm this interpretation.