Palantir Technologies Inc. (NASDAQ:PLTR)

Net Operating Profit After Taxes (NOPAT)

The net operating profit after taxes showed a progressive improvement over the five-year period. Initially, the company recorded significant losses of approximately -1.19 million USD in 2020, which reduced substantially to about -377 thousand USD in 2021 and -221 thousand USD in 2022. From 2023 onward, there was a positive turnaround, with NOPAT reaching 207 thousand USD and further increasing to 339 thousand USD in 2024. This indicates a transition from losses to profitability during this period.

Cost of Capital

The cost of capital remained relatively stable throughout the five years, fluctuating slightly between 33.67% and 34.05%. This marginal variation indicates a consistent capital cost structure, with no significant changes impacting financing expenses or risk premiums during the period analyzed.

Invested Capital

Invested capital increased steadily from approximately 2.18 million USD in 2020 to 3.07 million USD in 2022, reflecting an expansion phase. However, there was a notable reduction in 2023 to about 1.24 million USD, followed by a rebound to around 2.51 million USD in 2024. This pattern suggests a period of divestment or asset reduction in 2023, then renewed investment or asset accumulation in 2024.

Economic Profit

Economic profit consistently remained negative across all years, indicating that the company did not generate returns exceeding its cost of capital. Although the losses decreased from -1.93 million USD in 2020 to -1.25 million USD in 2021 and 2022, economic profit worsened to -213 thousand USD in 2023 but then increased to -514 thousand USD in 2024. Despite fluctuations, the persistent negative economic profit highlights ongoing challenges in creating value beyond capital costs.

Summary

The financial data reveals a company that has progressively improved operational profitability, moving from losses to positive net operating profit after taxes by 2023. The cost of capital remained stable, suggesting steady financing conditions. Invested capital shows an initial growth, a sharp drop, and a subsequent recovery indicating strategic asset management or capital restructuring. Nevertheless, the persistent negative economic profit suggests that, despite operational improvements, the company has yet to achieve returns exceeding its capital costs consistently, pointing to areas requiring enhanced efficiency or strategic focus.

The financial data reveals a significant improvement in profitability over the analyzed period.

Net Income (Loss) Attributable to Common Stockholders

A substantial negative net income was reported in 2020, amounting to approximately -1.17 billion US dollars. This loss decreased markedly in 2021 and 2022 to approximately -520 million and -374 million US dollars, respectively. In 2023, the company reversed its financial position with a positive net income of around 210 million US dollars, followed by further growth to approximately 462 million US dollars in 2024. This trend indicates a successful transition from significant losses to sustained profitability.

Net Operating Profit After Taxes (NOPAT)

Consistent with net income trends, NOPAT was markedly negative in 2020 (-1.19 billion US dollars), improving progressively to roughly -378 million in 2021 and -221 million in 2022. From 2023 onward, NOPAT turned positive, reaching about 207 million US dollars and expanding further to approximately 339 million US dollars in 2024. This reflects enhanced operational efficiency and effective tax management contributing to profitability.

Overall, the data demonstrates a clear and robust upward trajectory in both net income and operating profitability. The shift from pronounced losses to solid gains signals improved operational performance and potential stabilization of the company's financial health.

The financial data reveals notable fluctuations in both the provision for income taxes and cash operating taxes over the five-year period examined.

Provision for (benefit from) income taxes

Initially, there was a tax benefit of -$12,636 thousand in 2020. This shifted to a tax provision of $31,885 thousand in 2021, indicating a significant increase in tax expenses. In the following years, the provision decreased to $10,067 thousand in 2022, then rose again to $19,716 thousand in 2023, and slightly increased to $21,255 thousand in 2024. Overall, the provision for income taxes shows variability, with the initial tax benefit transitioning to recurring tax expenses that fluctuate but generally trend at a moderate level after 2021.

Cash operating taxes

Cash operating taxes experienced substantial variation across the period. The value was $13,182 thousand in 2020 and decreased to $7,577 thousand in 2021, showing a reduction in actual cash tax payments. However, there was a dramatic surge to $67,243 thousand in 2022, representing a significant cash outflow for taxes. This was followed by a sharp decrease to $1,246 thousand in 2023 and a negative outflow of -$15,989 thousand in 2024, indicating tax refunds or credits exceeding taxes paid. This irregular pattern suggests variability in the company's taxable income, tax planning strategies, or changes in tax regulations impacting cash taxes paid over time.

In summary, the data indicates a transition from tax benefits to taxable obligations in terms of accounting provision, with visible volatility year-over-year. The cash operating taxes display extreme fluctuations with a peak in 2022 and subsequent negative cash taxes in 2024, signaling potentially significant tax recoveries or adjustments in that year. This combination reflects an unstable tax environment or operational variability affecting the company's tax position during this period.

Total Reported Debt & Leases

There is a clear downward trend in total reported debt and leases from 2020 through 2023, decreasing from approximately 457 million USD to about 229 million USD. This represents a nearly 50% reduction over four years. In 2024, however, the debt level shows a slight increase to approximately 239 million USD, indicating a potential shift in capital structure or financing strategy.

Total Palantir’s Stockholders’ Equity

Stockholders’ equity has exhibited consistent and strong growth over the five-year period. Starting at around 1.52 billion USD in 2020, it increased steadily each year, reaching 5.00 billion USD by 2024. This trend suggests substantial value creation and effective retention of earnings or capital infusion, reflecting robust financial health and increased shareholder wealth.

Invested Capital

Invested capital generally increased from 2020 to 2022, rising from approximately 2.18 billion USD to about 3.07 billion USD, indicating growing deployment of resources in the business. However, there is a notable and sharp decline in 2023 to approximately 1.24 billion USD, followed by a recovery to 2.51 billion USD in 2024. The 2023 dip could signify asset disposals, restructuring, or a strategic shift in investment focus, with a partial rebound in the following year.

Economic Profit

The economic profit demonstrates a significant improvement from 2020 to 2023, moving from a loss of approximately -1,925,326 thousand US dollars in 2020 to a much smaller loss of -213,169 thousand US dollars in 2023. However, in 2024 there is a reversal in this positive trend, with economic profit declining to -514,594 thousand US dollars, indicating a deterioration of economic profitability in that year.

Invested Capital

Invested capital showed a rising trend from 2020 through 2022, increasing steadily from around 2,178,851 thousand US dollars to a peak of 3,071,913 thousand US dollars. In 2023, there was a sharp decline to 1,237,836 thousand US dollars, followed by a substantial rebound in 2024 back to 2,507,175 thousand US dollars. This fluctuation suggests a period of significant capital restructuring or asset divestiture in 2023, with partial recovery thereafter.

Economic Spread Ratio

The economic spread ratio remains negative for all years presented, indicating that the company consistently earned returns below its cost of capital. Although this ratio improves notably from -88.36% in 2020 to -17.22% in 2023, reflecting a reduction in the gap between returns and cost of capital, it worsens again in 2024 to -20.52%. This pattern aligns with the economic profit changes seen in the final years, emphasizing fluctuating efficiency in generating returns over invested capital.

Overall Analysis

The data illustrate a trajectory of financial improvement through 2023, with declining economic losses and a narrowing negative economic spread ratio, suggesting enhanced operational efficiency or profitability. However, 2024 shows a setback in both economic profit and spread ratio, despite an increase in invested capital, signaling potential challenges in generating sustainable returns on new or existing investments. The substantial volatility in invested capital in 2023 may correspond to strategic shifts affecting financial performance and capital deployment.

Economic Profit

The economic profit has demonstrated a significant improvement from 2020 to 2023, moving from a large negative value of -1,925,326 thousand USD in 2020 to a much smaller negative value of -213,169 thousand USD in 2023. This indicates a reduction in economic losses over the first four years. However, there is a notable deterioration in 2024, with economic profit decreasing again to -514,594 thousand USD, suggesting a reversal in the prior positive trend.

Adjusted Revenue

Adjusted revenue has shown consistent and substantial growth throughout the observed period. Starting at 1,069,583 thousand USD in 2020, revenue increased steadily each year, reaching 2,890,068 thousand USD by the end of 2024. This represents a strong upward trajectory, reflecting expansion in overall business activity and revenue generation capacity.

Economic Profit Margin

The economic profit margin exhibits a trend of significant improvement from extremely negative margins in 2020 (-180.01%) towards less negative margins by 2023 (-9.24%). A recovery in profitability efficiency is evident during this period, as the margin narrows substantially. Nevertheless, similar to economic profit, the margin worsens in 2024, increasing negatively again to -17.81%. This suggests that despite growth in revenue, the company faced challenges in converting revenue into economic profit efficiently during that year.

Overall Assessment

The data reflects a company experiencing strong revenue growth paired with improving economic profitability up to 2023. The consistent increase in adjusted revenue indicates expanding operations or market penetration. However, economic profit and the associated margin signals that profitability, while improving initially, remains negative and showed a setback in 2024. This reversal suggests potential cost pressures, investments, or other factors negatively impacting economic returns despite higher revenue.