Walmart Inc. (NYSE:WMT)

The data reveals several noteworthy trends in the company's operational efficiency over the observed periods.

Inventory Turnover

The inventory turnover ratio exhibits some fluctuations but generally remains stable with a slight downward movement around 2022 followed by recovery in subsequent years. It decreased from 9.35 in 2021 to 7.59 in 2022 and then gradually increased to 9.07 by 2025, indicating a temporary slowdown in inventory movement that was later resolved.

Receivables Turnover

The receivables turnover ratio shows a declining trend over the period. It peaked at 85.21 in 2021 and then declined to 67.62 in 2025. This trend suggests a lengthening in the time taken to collect receivables, consistent with the stable but slightly increased average receivable collection period of around 5 days from 2022 onwards.

Payables Turnover

Payables turnover remained relatively stable, fluctuating slightly between 8.40 and 8.72. The slight increase in 2025 suggests marginally faster payment of payables compared to prior years. This is corroborated by the average payables payment period, which remained constant at about 42 days from 2023 onward after a brief increase up to 47 days in 2022.

Average Inventory Processing Period

The average inventory processing period increased notably from 39 days in 2021 to 48 days in 2022 before declining back to 40 days in 2025. This pattern aligns with inventory turnover trends and reflects a temporary slowdown in inventory movement during 2022.

Operating Cycle

The operating cycle lengthened from 43 days in 2021 to 53 days in 2022, then shortened gradually to 45 days by 2025. This indicates a temporary increase in the total number of days inventory is held plus the collection period, before returning to earlier levels.

Cash Conversion Cycle

The cash conversion cycle shows variability, starting at 2 days in 2020, missing data for 2021, but increasing to 8 days in 2023 before declining to 3 days in 2025. This trend reflects changes in working capital management efficiency, with a peak in cash tied up around 2023 followed by improvements.

Overall, the company experienced a temporary dip in operational efficiency around 2022, observable through lower inventory and receivables turnover and lengthened operating and cash conversion cycles. Recovery is evident in the following years, indicating management’s efforts to optimize working capital and improve collection and payment processes.

The financial data reveals several important trends over the observed periods, focusing on cost of sales, inventories, and inventory turnover ratios.

Cost of Sales

The cost of sales has exhibited a consistent upward trend from 2020 through 2025, increasing from approximately US$394.6 billion to US$511.8 billion. This steady rise suggests increasing operational activity or inflationary effects impacting the cost structure. The year-over-year growth implies expansion in the scale of goods sold or higher input prices associated with sales.

Inventories

Inventories have generally increased from around US$44.4 billion in 2020 to approximately US$56.4 billion by 2025. Notably, there was a significant rise between 2021 and 2022, from roughly US$44.9 billion to US$56.5 billion, which then stabilized with only minor fluctuations in subsequent years. This pattern may indicate a strategic increase in inventory levels possibly to support sales growth or to mitigate supply chain risks. The relative stabilization after 2022 suggests inventory management adjustments to maintain efficient stock levels.

Inventory Turnover Ratio

The inventory turnover ratio shows variability throughout the period. Starting at 8.88 in 2020, it increased to 9.35 in 2021, followed by a decrease to 7.59 in 2022. Thereafter, the ratio rose again to 9.07 by 2025. These fluctuations suggest changes in inventory management efficiency or sales velocity. The dip in 2022 indicates slower inventory movement relative to cost of sales, while the recovery afterward points to improved turnover, potentially reflecting enhanced operational efficiency or better alignment of inventory levels with sales demand.

Overall, the trends depict a growing cost base aligned with rising inventories, accompanied by fluctuating but recovering inventory turnover. This interplay suggests ongoing efforts to balance inventory investment with sales performance to optimize operational efficiency.

Net Sales Trend

The net sales displayed a steady upward trajectory over the six-year period. Starting from 519,926 million US dollars in early 2020, net sales increased annually, reaching 674,538 million US dollars by early 2025. Notably, the largest annual increment occurred between January 31, 2022, and January 31, 2023, indicating a possible acceleration in revenue growth during that interval.

Receivables, Net Trend

The accounts receivable, net, showed a generally increasing pattern from 6,284 million US dollars in 2020 to 9,975 million US dollars by 2025. Despite a slight decrease from 8,280 million in 2022 to 7,933 million in 2023, the overall trend suggests a growing amount of outstanding receivables, which could reflect expanded credit sales or a change in credit policy.

Receivables Turnover Ratio Trend

The receivables turnover ratio exhibited variability throughout the period. Beginning at 82.74 in 2020, it initially increased to 85.21 in 2021, indicating improved efficiency in collecting receivables. However, there was a notable decline to 68.57 in 2022, followed by a partial recovery in 2023 to 76.37, and subsequent declines toward 67.62 by 2025. This downward trend in later years might suggest decreasing efficiency in receivables collection or longer collection periods despite increasing sales volumes.

Overall Interpretation

The concurrent increase in net sales and receivables, coupled with a declining receivables turnover ratio in later years, points toward a potential elongation of the company's cash conversion cycle. The growth in receivables may be driven by expanding operations and sales on credit; however, the diminishing turnover ratio warrants attention to credit management practices to ensure timely collection and maintain liquidity.

Cost of Sales Trend

The cost of sales exhibited a consistent upward trajectory over the observed period. Starting at 394,605 million USD in 2020, it progressively increased each year, reaching 511,753 million USD by 2025. This steady rise suggests either growth in sales volume or increased input costs, reflecting an expanding scale of operations or inflationary pressures.

Accounts Payable Trend

Accounts payable also grew over the period, rising from 46,973 million USD in 2020 to 58,666 million USD in 2025. The increase, though positive, showed some variability, with a slight dip observed in 2023 before resuming growth. This pattern may indicate fluctuations in payment policies or supplier negotiation terms during the midpoint of the period.

Payables Turnover Ratio Trend

The payables turnover ratio displayed moderate fluctuations. It started at 8.4 times in 2020, increased slightly to 8.55 in 2021, and then decreased to 7.76 in 2022. From 2023 onwards, the ratio stabilized and increased again, reaching 8.72 by 2025. This indicates some inconsistency in the speed of payments to suppliers, with a slower payment pace in 2022, followed by quicker turnover in subsequent years.

Overall Insights

The data reflects a growing operational scale as evidenced by rising cost of sales and accounts payable balances. The payables turnover ratio variability points to changes in supplier payment behavior, with a tendency toward more efficient payment cycles in recent years. The company's managing of payables alongside expanding costs suggests active working capital management, adapting to evolving business conditions.

The financial data reveals various trends in key financial metrics over the examined period.

Working Capital

Working capital figures demonstrate significant fluctuations, with generally high negative values throughout the years. Initially, working capital was at -15,984 million USD in early 2020, improving to a less negative -2,578 million USD in 2021. However, it reversed to -6,309 million USD in 2022 and declined sharply again to -16,543 million USD in 2023. In the following years, working capital remained deeply negative, with -15,538 million USD in 2024 and further decline to -17,126 million USD in 2025. This pattern indicates persistent negative working capital, suggesting that current liabilities consistently exceeded current assets, with some temporary improvements.

Net Sales

Net sales displayed a consistent upward trend across all periods. Starting from 519,926 million USD in 2020, net sales increased continually each year, reaching 674,538 million USD by 2025. This steady growth reflects expanding revenue and potentially increasing market demand or effective sales strategies.

Working Capital Turnover

No data was provided to analyze working capital turnover ratio, limiting insights into how efficiently the company is utilizing its working capital relative to sales.

Overall, the company’s sales performance strengthened steadily, while its working capital remained negative and volatile, which may warrant further analysis regarding liquidity management and short-term financial obligations.

Inventory Turnover

The inventory turnover ratio experienced variability over the observed periods. Starting at 8.88 in January 2020, it increased to a peak of 9.35 in January 2021, indicating improved efficiency in inventory management during that period. However, it declined to 7.59 by January 2022, suggesting a slowdown in the frequency of inventory replacement. Subsequent years saw a gradual recovery with the ratio rising to 8.2 in 2023, and further improvements were observed through 2024 and 2025, reaching 8.93 and 9.07 respectively. This recovery points to a positive trend toward more effective inventory utilization approaching previous high levels.

Average Inventory Processing Period

This metric, reflecting the average number of days to process inventory, showed an inverse pattern compared to the turnover ratio. The period decreased from 41 days in 2020 to 39 days in 2021, aligning with the observed increase in turnover. However, it lengthened significantly to 48 days in 2022, suggesting slower inventory movement or buildup during that year. In the following years, the processing period improved progressively, reducing to 45 days in 2023, and returning closer to prior efficiencies with 41 days in 2024 and 40 days in 2025. These shifts indicate a return to more efficient inventory management practices after a temporary slowdown.

Overall Insights

The analysis of inventory turnover and average processing period reveals a cyclical pattern in inventory management efficiency. The initial improvement followed by a notable dip and subsequent recovery may reflect responses to market or operational challenges impacting inventory handling. The recent upward trend in turnover ratio combined with the reduction in processing period suggests ongoing optimization and strengthening of inventory control mechanisms. These changes underscore a regained operational momentum in managing inventory assets effectively over the last available periods.

The financial data presents trends related to the company's receivables management over a six-year period.

Receivables Turnover

The receivables turnover ratio displays a fluctuating trend from 2020 to 2025. It starts at 82.74 in 2020, slightly increases to 85.21 in 2021, then declines to 68.57 in 2022. It recovers somewhat to 76.37 in 2023, but thereafter it decreases again to 73.06 in 2024 and further to 67.62 in 2025. This overall decrease after 2021 suggests a moderate slowdown in the efficiency with which the company is collecting its receivables.

Average Receivable Collection Period

The average collection period remains relatively stable throughout the period, starting at 4 days in 2020 and 2021, moving to 5 days from 2022 to 2025. This indicates that on average, the company takes approximately 4 to 5 days to collect receivables, with a slight increase from 2022 onward, which may correspond to the decreasing turnover ratio.

In summary, the data suggests that while the company has maintained a relatively short receivable collection period, there is a gradual decline in the receivables turnover ratio, implying marginally slower collection efficiency over the latter years. The increase in collection period from 4 to 5 days corresponds with this trend, signaling a need for potential monitoring of receivables management practices to maintain or improve cash flow performance.

Inventory Processing Period

The average inventory processing period showed fluctuations over the analyzed years, starting at 41 days in early 2020, declining slightly to 39 days in early 2021, then increasing markedly to 48 days in early 2022. This was followed by a gradual decrease to 45 days in early 2023, 41 days in early 2024, and a further slight reduction to 40 days by early 2025. The general trend suggests some volatility with a peak in 2022 but a downward movement towards the later periods.

Receivable Collection Period

The average receivable collection period remained relatively stable throughout the entire timeline, starting at 4 days in early 2020 and 2021, then increasing marginally to 5 days from early 2022 onwards and maintaining this level through early 2025. This indicates a consistent credit collection efficiency with only a minor increase in the number of days to collect receivables.

Operating Cycle

The operating cycle closely followed the patterns observed in inventory processing and receivable collection periods. It started at 45 days in early 2020, decreased to 43 days in early 2021, then rose substantially to 53 days in early 2022. Subsequently, it progressively declined over the next three years, reaching 50 days in early 2023, 46 days in early 2024, and finally 45 days in early 2025. This reflects an initial lengthening of the operating cycle with a later return to a shorter cycle duration, approaching the initial level at the start of the period analyzed.

Overall Insights

The data reveals a period of operational slowdown around the 2022 fiscal year, especially evident in the inventory processing and operating cycle durations, signaling potential issues or strategic changes in inventory management. From 2023 onwards, there is a clear trend toward normalization and improved efficiency, with these cycles decreasing toward earlier levels. The receivable collection, however, shows remarkable consistency with minimal variation, suggesting robust and stable credit control practices over the six-year span.

Payables Turnover

The payables turnover ratio exhibited some fluctuations over the observed periods. It started at 8.4 in January 2020, slightly increased to 8.55 in January 2021, then declined to 7.76 in January 2022. Subsequently, it rose again to 8.63 in both January 2023 and January 2024, with a further modest increase to 8.72 by January 2025. This pattern suggests a period of reduced turnover efficiency in 2022, followed by a recovery and gradual improvement through to 2025.

Average Payables Payment Period

The average payables payment period remained stable for the most part, starting at 43 days in January 2020 and 2021. It increased to 47 days in January 2022, indicating a longer payment duration during that year. However, from January 2023 onwards, the payment period decreased and stabilized at 42 days through to January 2025. This trend corresponds inversely with the payables turnover ratio's decline and subsequent recovery, highlighting a tighter management of payables after 2022.

Average Inventory Processing Period

The average inventory processing period exhibits some variability over the observed years. It decreased from 41 days in 2020 to 39 days in 2021, followed by an increase to 48 days in 2022. Subsequently, it declined to 45 days in 2023, and further reduced to 41 days in 2024 and 40 days in 2025, nearing the initial level recorded in 2020. This indicates fluctuations in inventory management efficiency but an overall return to the initial processing duration over the period.

Average Receivable Collection Period

The average receivable collection period remains relatively stable throughout the period analyzed. It was 4 days in 2020 and 2021, then slightly increased to 5 days from 2022 onward, maintaining this level consistently until 2025. This stability suggests consistent collection practices with a minor elongation starting in 2022.

Average Payables Payment Period

The average payables payment period shows moderate fluctuations. It stayed constant at 43 days in 2020 and 2021, rose to 47 days in 2022, and then decreased to 42 days from 2023 to 2025. The peak in 2022 might indicate temporary adjustments in payables management, while the return to lower values afterwards suggests normalization.

Cash Conversion Cycle

The cash conversion cycle displays variation from 2020 to 2025. It started at 2 days in 2020, data is missing for 2021, increased to 6 days in 2022 and further to 8 days in 2023, followed by a significant decrease to 4 days in 2024 and 3 days in 2025. This pattern reflects a temporary extension in the cash conversion cycle during 2022 and 2023, implying a longer time for cash to be converted from the company's investments in inventory and receivables. The subsequent reduction indicates improved operational efficiency and cash flow management in the later years.