Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
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- Statement of Comprehensive Income
- Balance Sheet: Assets
- Cash Flow Statement
- Common-Size Balance Sheet: Assets
- Enterprise Value to EBITDA (EV/EBITDA)
- Capital Asset Pricing Model (CAPM)
- Net Profit Margin since 2020
- Return on Assets (ROA) since 2020
- Price to Earnings (P/E) since 2020
- Aggregate Accruals
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Economic Profit
Palantir Technologies Inc., economic profit calculation
US$ in thousands
| 12 months ended: | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | ||||||
| Cost of capital2 | ||||||
| Invested capital3 | ||||||
| Economic profit4 | ||||||
Based on: 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), 10-K (reporting date: 2020-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2024 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- NOPAT demonstrates a significant positive shift over the analyzed periods. Initially, it shows substantial losses in 2020 with a value of -1,189,427 thousand US dollars, followed by a decreasing negative loss trend in 2021 and 2022. In 2023, NOPAT transitions into positive territory at 207,040 thousand US dollars and further increases to 339,176 thousand US dollars by 2024. This indicates an improving operational profitability trajectory.
- Cost of Capital
- The cost of capital remains relatively stable throughout the years, fluctuating only slightly between 32.84% and 33.2%. This stability suggests that the firm's required rate of return has been consistent, implying no significant change in the perceived risk or capital structure from 2020 to 2024.
- Invested Capital
- Invested capital shows a fluctuating pattern with an initial upward trend from 2,178,851 thousand US dollars in 2020 to a peak of 3,071,913 thousand US dollars in 2022. This is followed by a notable drop in 2023 to 1,237,836 thousand US dollars, before rising again in 2024 to 2,507,175 thousand US dollars. These movements could reflect changes in asset acquisitions, disposals, or operational scaling.
- Economic Profit
- Economic profit is consistently negative across all periods, indicating that the firm is not generating returns above its cost of capital. Although the losses decline from -1,907,004 thousand US dollars in 2020 to -202,697 thousand US dollars in 2023, the escalation back to -493,307 thousand US dollars in 2024 suggests some variability. Despite operational profit improvements, the firm has yet to achieve sustained positive economic profit.
Net Operating Profit after Taxes (NOPAT)
Palantir Technologies Inc., NOPAT calculation
US$ in thousands
Based on: 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), 10-K (reporting date: 2020-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowance for credit losses.
3 Addition of increase (decrease) in deferred revenue.
4 Addition of increase (decrease) in equity equivalents to net income (loss) attributable to common stockholders.
5 2024 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
6 2024 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
7 Addition of after taxes interest expense to net income (loss) attributable to common stockholders.
8 2024 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =
9 Elimination of after taxes investment income.
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.
Cash Operating Taxes
Palantir Technologies Inc., cash operating taxes calculation
US$ in thousands
Based on: 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), 10-K (reporting date: 2020-12-31).
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 -$15,989 thousand in 2024, indicating tax refunds or credits exceeding taxes paid. This irregular pattern suggests variability in the company's taxable income, tax planning strategies, or changes in tax regulations impacting cash taxes paid over time.
In summary, the data indicates a transition from tax benefits to taxable obligations in terms of accounting provision, with visible volatility year-over-year. The cash operating taxes display extreme fluctuations with a peak in 2022 and subsequent negative cash taxes in 2024, signaling potentially significant tax recoveries or adjustments in that year. This combination reflects an unstable tax environment or operational variability affecting the company's tax position during this period.
Invested Capital
Palantir Technologies Inc., invested capital calculation (financing approach)
US$ in thousands
Based on: 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), 10-K (reporting date: 2020-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of deferred revenue.
5 Addition of equity equivalents to total Palantir’s stockholders’ equity.
6 Removal of accumulated other comprehensive income.
7 Subtraction of construction in progress.
8 Subtraction of marketable securities.
- 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.
Cost of Capital
Palantir Technologies Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2024-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Debt3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-12-31).
1 US$ in thousands
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Palantir Technologies Inc., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| Economic spread ratio3 | ||||||
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Datadog Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
Based on: 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), 10-K (reporting date: 2020-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2024 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Economic Profit
- The economic profit shows a consistent deficit throughout the observed period. Although the negative value decreases substantially from -1,907,004 thousand US dollars in 2020 to -202,697 thousand US dollars in 2023, there is a slight reversal observed in 2024 with the value deteriorating to -493,307 thousand US dollars. Overall, the trend indicates an improvement in economic profit over the first four years, followed by a setback in the latest year.
- Invested Capital
- Invested capital demonstrates a fluctuating trend. It increases steadily from 2,178,851 thousand US dollars in 2020 to a peak of 3,071,913 thousand US dollars in 2022. However, there is a marked decline to 1,237,836 thousand US dollars in 2023, followed by a recovery to 2,507,175 thousand US dollars in 2024. This fluctuation suggests potential changes in asset allocation or divestments in 2023 with a subsequent reinvestment or capital inflow in 2024.
- Economic Spread Ratio
- The economic spread ratio, representing the margin between returns on invested capital and cost of capital, remains negative throughout the period but reflects a notable upward trend. It improves from -87.52% in 2020 to -16.38% by 2023, indicating reduced inefficiency or losses relative to the capital invested. In 2024, the ratio slightly worsens to -19.68% but remains significantly better than in earlier years, suggesting some recovery in operational efficiency despite ongoing economic challenges.
- Summary of Trends
- Collectively, the data indicates a period of financial adjustment with the company reducing its economic losses markedly from 2020 through 2023 while experiencing variations in invested capital. The improvement in economic spread ratio parallels the reduction in economic losses, evidencing better utilization of capital. Nonetheless, the deterioration in economic profit and economic spread ratio in 2024 suggests renewed pressures or challenges that affected financial performance during the last year. The fluctuations in invested capital imply strategic shifts or changing investment levels, which may be linked to the variability in economic outcomes observed.
Economic Profit Margin
Palantir Technologies Inc., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | ||||||
| Revenue | ||||||
| Add: Increase (decrease) in deferred revenue | ||||||
| Adjusted revenue | ||||||
| Performance Ratio | ||||||
| Economic profit margin2 | ||||||
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Datadog Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
Based on: 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), 10-K (reporting date: 2020-12-31).
1 Economic profit. See details »
2 2024 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × ÷ =
3 Click competitor name to see calculations.
- Economic Profit
- The economic profit demonstrates a significant improvement over the analyzed period. Starting from a substantial negative value of approximately -1.91 billion USD in 2020, the loss progressively decreases each year. By 2023, the economic loss narrows sharply to just below -203 million USD, before increasing slightly to approximately -493 million USD in 2024. Overall, this reflects a trend of decreasing economic losses and improving profitability dynamics, despite a minor setback in the final year.
- Adjusted Revenue
- Adjusted revenue exhibits a strong and consistent upward trajectory throughout the period. Beginning at roughly 1.07 billion USD in 2020, revenue grows steadily each year, reaching nearly 2.89 billion USD by 2024. This signifies a robust expansion of sales or operational scale, with more than doubling of revenue over the five-year span, indicating successful top-line growth.
- Economic Profit Margin
- The economic profit margin follows a pattern consistent with economic profit trends, starting from a deeply negative margin of -178.29% in 2020. The margin improves significantly year-over-year, reaching its best comparative level of -8.79% in 2023. However, in 2024, the margin deteriorates to -17.07%, reflecting a decline in efficiency relative to revenue despite overall revenue growth. The negative margins throughout the period indicate ongoing challenges in translating revenue into positive economic profit.
In summary, the company shows strong revenue growth accompanied by marked improvements in economic profit and economic profit margin, although economic profitability remains negative across all years. The narrowing loss profile until 2023 suggests enhanced operational effectiveness or cost management, but the slight reversal in 2024 signals potential emerging challenges that warrant monitoring.