Palantir Technologies Inc. (NASDAQ:PLTR)

Receivables Turnover

The receivables turnover ratio exhibits fluctuations over the observed periods, initially rising from 6.42 to a peak of 7.81 by the first quarter of 2023, indicating improved efficiency in collecting receivables. However, subsequent quarters show a declining trend, falling to as low as 3.76 in mid-2024 before a partial recovery towards the end of 2024 and into 2025. This declining turnover suggests that the company has been slower in collecting its receivables in recent periods.

Payables Turnover

The payables turnover displays significant volatility with dramatic spikes in some quarters, notably reaching very high levels in early 2023 and at the end of 2024. These extreme fluctuations may indicate irregularities or one-time effects impacting payable settlements. Aside from these spikes, the ratio generally trends downward in the latter periods approaching early 2025, signaling slower payments to suppliers over time.

Working Capital Turnover

Working capital turnover shows a gradual but consistent decline throughout the periods analyzed, decreasing from 0.73 in the first quarter of 2022 to values around 0.58-0.61 in 2024 and 2025. This suggests that the company is generating less revenue per unit of working capital, pointing to potential decreases in overall operational efficiency.

Average Receivable Collection Period

This metric trends inversely to receivables turnover, increasing from 57 days at the start of the observation to peaks near 97 days in mid-2024, followed by moderate decreases and rises in early 2025. The longer collection periods indicate slower customer payments, which can impact cash flow negatively.

Average Payables Payment Period

The average payables payment period shows marked variability, with values oscillating between very short periods (as low as 1-4 days in early 2023) and longer durations reaching up to 56 days. The pattern suggests inconsistency in payment practices, possibly reflecting changing supplier agreements, cash management tactics, or other operational factors. Missing data in some periods prevents a complete trend analysis for certain intervals.

Revenue Trends

The revenue of the company exhibits a consistent upward trajectory across the analyzed periods. Starting from approximately $446.4 million in March 2022, it steadily increased each quarter, reaching about $1.18 billion by September 2025. This represents substantial growth in top-line sales, with notable acceleration in the latter quarters, particularly visible from mid-2024 onwards.

Accounts Receivable Movement

The net accounts receivable show a generally increasing pattern, though with fluctuations. Beginning near $256.6 million in March 2022, the figure rose overall to approximately $1.01 billion by September 2025. However, there are periods where receivables either spiked significantly, such as mid-2023 and mid-2024, or decreased, like late 2022 and early 2024. These variations indicate variability in the company's credit extended to customers or collection efficiency across quarters.

Receivables Turnover Ratio Analysis

The receivables turnover ratio displays considerable volatility over time, starting at 6.42 in the first quarter of 2022 and moving downwards to 3.87 by the third quarter of 2025. This decline in turnover ratio suggests a slowing in the frequency at which the company collects its outstanding receivables relative to the revenue generated. Lower turnover ratios in later periods correlate with higher accounts receivable balances, implying increased credit exposure or slower collections.

Interpretation of Working Capital Efficiency

The observed decrease in receivables turnover ratio combined with rising accounts receivable balances suggests a potential deterioration in working capital efficiency regarding receivables management. While revenue has grown robustly, the slower collection cycle might impact cash flows and operational liquidity. This trend calls for further scrutiny into credit policies, customer payment behavior, or invoicing practices to ensure the balance between sales growth and cash conversion remains healthy.

Summary of Financial Position Dynamics

Overall, the company demonstrates strong revenue growth throughout the period. However, the growth in accounts receivable outpaces the improvement in the turnover ratio, signifying that outstanding balances are not being converted into cash at a proportionate pace. This dynamic may present risks related to cash flow timing and collection effectiveness. Monitoring these trends will be essential for maintaining financial stability as the company expands.

The analysis of the quarterly financial data reveals notable trends across cost of revenue, accounts payable, and payables turnover over the examined periods.

Cost of Revenue

The cost of revenue demonstrates a generally upward trajectory across the quarters. Starting at approximately 94.4 million in early 2022, it gradually increased to around 108.6 million by the end of 2022. Throughout 2023 and into 2025, the values continue rising, reaching over 207 million in the third quarter of 2025. This steady increase suggests either growth in sales volume, rising input costs, or a combination of both, indicating expanding operational activity or inflationary pressures on costs.

Accounts Payable

Accounts payable exhibits considerable volatility over the analysis period. Early 2022 saw moderate amounts, peaking in the second quarter of 2022 at approximately 56.8 million, before sharply declining to around 4.5 million by the first quarter of 2023. Following this trough, payable balances increased again to about 12.1 million by the end of 2023. Subsequently, the pattern becomes more erratic, with spikes reaching over 67.3 million in mid-2024 and fluctuating widely thereafter, including a minimal value near zero in late 2024. This volatility may reflect timing differences in supplier payments, changes in credit terms, or irregular purchase patterns affecting short-term liabilities.

Payables Turnover

The payables turnover ratio shows significant instability and extreme fluctuations throughout the quarters. Initially, the ratio decreased from 13.1 to a low around 6.5 during mid-2022, then increased to over 9 by the end of 2022. In early 2023, the ratio spikes dramatically, reaching very high values above 90, indicating faster payment to suppliers relative to purchases or a drop in payables balance. Thereafter, the ratio shows sharp oscillations, with sudden peaks and troughs including an anomalous figure exceeding 5400 toward late 2024, followed by a decline and further variability. Such fluctuations suggest inconsistent payment behavior or distortions due to very low accounts payable balances at certain points, complicating interpretation of the company's payment practices to vendors.

Overall, the data reflects growing cost pressures with increasing cost of revenue, while liabilities related to payables and the corresponding turnover ratio have shown irregular patterns, potentially influenced by operational or financial management decisions. This combination of upward cost trends and volatile payables metrics warrants further investigation to clarify underlying causes and implications for cash flow and supplier relationships.

Working Capital

Working capital shows a consistent upward trend over the observed periods, increasing steadily from approximately 2,258 million USD at March 31, 2022, to about 6,406 million USD by September 30, 2025. This reflects a significant expansion in the company's short-term assets relative to its short-term liabilities, suggesting improved liquidity and potentially greater operational capacity over time.

Revenue

Revenue also demonstrates a persistent growth trajectory, rising from around 446 million USD at the first quarter of 2022 to over 1,181 million USD by the third quarter of 2025. This steady increase in sales indicates ongoing business expansion and stronger market penetration, with revenue more than doubling over the period.

Working Capital Turnover

The working capital turnover ratio experiences a gradual decline throughout the timeline, starting at 0.73 in the first quarter of 2022 and decreasing to a low near 0.58 by the end of 2024, before a slight recovery to 0.61 in the third quarter of 2025. This downward trend suggests that revenue growth is not keeping pace proportionally with the increase in working capital, potentially indicating less efficient use of working capital resources in generating sales.

Overall Analysis

The company is markedly increasing both its working capital and revenue, reflecting growth and an expanding operational scale. However, the declining working capital turnover ratio signals a reduction in operational efficiency related to working capital utilization. While liquidity and sales volumes are improving, the company may need to focus on optimizing working capital management to sustain or improve the efficiency with which current assets support revenue generation.

Receivables Turnover

The receivables turnover ratio exhibited a fluctuating trend over the analyzed periods. Initially, it increased from 6.42 to a peak of 7.81 by the first quarter of 2023, indicating an improvement in the efficiency of collecting receivables. However, from mid-2023 onward, the ratio generally trended downward, reaching a low of 3.76 in the second quarter of 2024 before stabilizing somewhat around the 4.3–4.6 range by mid-2025. This decline suggests a gradual reduction in collection efficiency in recent periods.

Average Receivable Collection Period

The average receivable collection period showed an inverse relationship to the receivables turnover, as expected. It began at 57 days in the first quarter of 2022, then decreased to 47 days by the first quarter of 2023, reflecting faster collections. After this point, the collection period increased markedly, reaching a maximum of 97 days by the second quarter of 2024, signaling slower receivables turnover. Towards mid-2025, the collection period decreased slightly but remained elevated compared to earlier periods, ending around 79 to 94 days. This pattern indicates a trend of lengthening cash conversion cycles through the most recent quarters.

The payables turnover ratio exhibits significant volatility over the observed periods. Initially, it starts at 13.1 and experiences a sharp decline to values around 6.5 during mid-2022. Subsequently, there is a marked spike reaching extraordinarily high levels, with the ratio peaking at 5495.05 in the quarter ending December 2024. Such an abnormal increase suggests either an unusual payment dynamic or a potential anomaly in reporting during that period. After this peak, the ratio declines again, returning to more moderate values in the last reported quarters, around 11.08 in the final period. Overall, the payables turnover reflects irregular payment patterns and potentially fluctuating supplier management strategies.

The average payables payment period in number of days mirrors the inverse of the payables turnover trend, as expected. It starts near 28 days in the first quarter of 2022 and then increases to about 55-56 days, indicating a slower payment process in mid-2022. From there, a drastic reduction occurs, with the payment period dropping to as low as 1 day in June 2025, aligning with the periods of extremely high payables turnover. This suggests accelerated payment practices during these quarters. Notably, some quarters have missing or zero values, which limits continuous interpretation, but the general observation is that the company oscillates between extended and very short payment terms over the analyzed timeframe.

In summary, the financial data reveals irregular and fluctuating payables management, with periods of unusually rapid payments contrasted by times of delayed payables. The extreme spikes and drops in ratios and payment periods indicate significant changes in payables processing, possibly influenced by operational decisions or external factors affecting supplier payments. This volatility should be investigated further to assess impacts on supplier relationships and overall working capital management.

Payables Turnover Ratio:

Shows high volatility with a significant spike to 5495.05 in late 2024, followed by normalization.

Average Payables Payment Period:

Varies widely from around 55 days down to 1 day, indicating fluctuating payment speeds and strategies.

Overall Interpretation:

The company's payables management strategy appears inconsistent across quarters, with abrupt shifts between fast and slow payment cycles affecting supplier payment dynamics and potentially working capital efficiency.