Trade Desk Inc. (NASDAQ:TTD)

Receivables Turnover

The receivables turnover ratio exhibits a generally increasing trend over the analyzed periods. Starting at 0.65 in March 2021, it showed moderate fluctuations but mostly rose to reach around 0.8 by the latest quarters in 2025. This improvement indicates enhanced efficiency in collecting receivables over time, with some periodic variability.

Payables Turnover

The payables turnover ratio remained relatively stable but showed a slight upward trend. It started at about 0.17 in early 2021, experienced minor fluctuations across quarters, and gradually increased to approximately 0.21 by 2025. This suggests a modest acceleration in the payment of payables, implying the company is paying its suppliers somewhat faster.

Working Capital Turnover

The working capital turnover ratio fluctuated moderately but overall displayed a positive trend, particularly in the later periods. From roughly 0.99 in early 2021, it dipped during late 2021 and early 2022 but then recovered and rose consistently from 2023 onward. By the end of the analyzed timeline, it reached approximately 1.3, indicating improved efficiency in utilizing working capital to generate revenue.

Average Receivable Collection Period

The average receivable collection period, measured in days, generally declined, reflecting faster collection times. It started quite high, around 558 days in early 2021, with some fluctuations but demonstrated a downward movement toward roughly 450 days by the recent quarters of 2025. This reduction correlates with the increase in receivables turnover, showing enhanced receivables management.

Average Payables Payment Period

The average payables payment period shows a gradual decrease over time, indicating quicker payments to suppliers. Initial values exceeded 2200 days in early 2021, with some periods reaching nearly 2700 days, but this duration shortened substantially, falling to around 1700 days in 2025. The decline matches the slight rise in payables turnover, confirming the trend toward faster payment cycles.

The revenue exhibits a general upward trend over the observed periods, with notable seasonal fluctuations. Starting from approximately $220 million in the first quarter of 2021, revenue increases steadily and peaks near $742 million by the fourth quarter of 2024. Despite these increases, there are periodic declines in some quarters, indicating potential cyclical effects or market adjustments. For instance, after reaching a quarterly peak in December 2021, revenue declined in the following quarter before resuming growth. Similar patterns are visible in subsequent years, suggesting variability amid overall growth.

Accounts receivable, net of allowance for credit losses, also shows a consistent rise throughout the timeframe. It begins at approximately $1.37 billion in the first quarter of 2021 and climbs to about $3.48 billion by the third quarter of 2025. This steady increase correlates with the expanding revenue base but at a faster rate, implying that the company may be extending more credit to its customers over time or experiencing slower collections. The jump in accounts receivable in the final observed quarters may warrant further investigation to assess credit risk and cash flow impact.

The receivables turnover ratio fluctuates mildly throughout the periods, ranging between 0.59 and 0.84. Lower turnover ratios, observed occasionally in late 2021 and late 2024, suggest slower collection of receivables during those times, which could indicate temporary inefficiencies in credit management or shifts in payment terms. Conversely, higher ratios, especially in early and mid-2025, reflect more effective accounts receivable management, with quicker collections relative to revenue. The pattern of turnover ratios aligns inversely with the spikes in accounts receivable balances, reinforcing the seasonal nature of receivables management performance.

Revenue

Overall growth with seasonal variability, increasing from $220 million to $742 million over nearly five years.

Accounts Receivable

Consistent and substantial increase, from $1.37 billion to $3.48 billion, outpacing revenue growth and suggesting elongation of credit terms or collection delays.

Receivables Turnover

Moderate fluctuations between 0.59 and 0.84, indicating varying efficiency in receivables collection; periods of slower turnover coincide with rising accounts receivable balances.

Platform Operations

The value of platform operations shows a generally increasing trend over the reported periods. Starting from approximately 50.5 million USD in the first quarter of 2021, the figure rises steadily, reaching a notable peak of about 162.2 million USD by the first quarter of 2025. There are consistent quarterly increases, with occasional acceleration in growth, particularly evident in the fourth quarters of each year, suggesting seasonality or end-of-year business activities that boost operations.

Accounts Payable

Accounts payable displays significant fluctuations but overall an upward trajectory across the quarters. Beginning at around 1.14 billion USD in early 2021, the amount increases sharply in the fourth quarter of 2021 to over 1.65 billion USD. This level moderately declines and then rises again in cycles but generally trends upwards, reaching approximately 2.76 billion USD by the first quarter of 2025. The data indicate growing obligations towards suppliers or service providers over time, with sharp increases in the fourth quarters, possibly reflecting increased operational activity or deferred payments at year-end.

Payables Turnover Ratio

The payables turnover ratio remains relatively stable throughout the periods, oscillating between approximately 0.13 and 0.21. Early 2021 saw ratios around 0.16 to 0.17, with a slight decline in the fourth quarter of 2021 to 0.13. From 2022 onwards, the ratio stabilizes mostly between 0.15 and 0.18, with a discernible increase in the last reported quarters towards 0.20-0.21. The incremental rise in turnover ratio towards the final quarters suggests an improvement in the company's efficiency in paying its suppliers or a shorter credit period being negotiated or enforced over time.

Working Capital

The working capital demonstrated a generally increasing trend from March 2021 through December 2024, growing from approximately $907 million to over $2.46 billion. This growth reflects a strengthening liquidity position over the years. After reaching a peak at the end of 2024, there is a noticeable decline in the subsequent quarters of 2025, decreasing to about $2.13 billion by the third quarter. This reduction may warrant further investigation to understand its causes and implications.

Revenue

Revenue showed a positive growth trajectory across the analyzed timeframe. Starting at roughly $220 million in the first quarter of 2021, it steadily increased to exceed $741 million by the fourth quarter of 2024. There are seasonal fluctuations observable within each year; for instance, revenues typically dip in the first quarter and rise towards year-end, especially evident in 2023 and 2024. The trend is consistent with expanding business operations or market demand enhancements. The revenue slightly decreased in early 2025 quarters but remained above prior years' first quarter figures.

Working Capital Turnover Ratio

The working capital turnover ratio, which measures the efficiency of using working capital to generate revenue, fluctuated within a range of approximately 0.87 to 1.31 during the period. Initially, the ratio hovered around 0.9 to 1.0 in 2021 and early 2022, indicating balanced capital utilization. In 2023 and 2024, the ratio increased above 1.0, reaching up to approximately 1.31 by the third quarter of 2025, suggesting improving operational efficiency and better utilization of working capital for revenue generation. Notably, the ratio saw a dip below 1.0 in late 2021 and early 2022, coinciding with rapid working capital growth, which could imply temporary less efficient use of capital.

Summary Insights

Overall, the data indicates a positive growth trajectory in both liquidity and revenue, paired with improving efficiency in working capital utilization over the multi-year period. The company demonstrates an increasing ability to generate revenue from its working capital, as reflected by the upward trend in the working capital turnover ratio after mid-2022. The dip in working capital and revenue in early 2025 should be monitored to determine if this is a transient variation or an indication of emerging operational challenges.

Receivables Turnover

The receivables turnover ratio demonstrates moderate variability throughout the observed periods, with values generally ranging between 0.59 and 0.84. Starting from a relatively low point of 0.65 in the first quarter of 2021, the ratio exhibits gradual improvement over time, peaking around 0.84 in the first quarter of 2025. Temporary dips are observed, notably near year-end periods, but the overall trend suggests an enhanced efficiency in collecting receivables over the analyzed timeframe.

Average Receivable Collection Period

The average collection period shows a fluctuating pattern, moving between 434 and 616 days. The initial high value of 558 days in early 2021 decreases significantly at times, with the lowest observed at 434 days in the first quarter of 2025. However, intermittent increases indicate some variability in collection speed depending on the quarter. The general downward trajectory in days indicates improved efficiency in collecting receivables, which aligns inversely with the increasing trend of receivables turnover observed.

Overall Analysis

The inverse relationship between the receivables turnover ratio and the average collection period is consistent with typical financial behavior: as turnover improves (increasing ratio), collection days decline. This suggests an overall improvement in credit management and collection processes over the period. Occasional fluctuations suggest possible seasonal impacts or changes in business conditions, but the broad trend reflects enhanced operational efficiency regarding receivables.

The payables turnover ratio demonstrates a relatively stable trend with slight fluctuations over the examined periods. Initially, the ratio hovers around 0.16-0.17 between early 2021 and mid-2022, followed by a modest decrease towards the end of 2022. From 2023 onward, the ratio generally maintains a higher level, mostly between 0.17 and 0.18, with a noticeable uptick reaching 0.21 by the first three quarters of 2025. This upward movement suggests a gradual improvement in the frequency at which payables are settled relative to purchases, indicating somewhat faster payment practices over time.

Conversely, the average payables payment period, measured in days, inversely reflects the payables turnover trend. Starting from an exceptionally high point exceeding 2200 days in 2021, the payment period peaks around the end of 2021 near 2700 days, implying very extended payment terms or slower settlement cycles during that interval. Afterward, the days outstanding display a declining pattern, with some variability, trending downward throughout the periods to roughly 1700 days by 2025. This decline aligns with the increasing payables turnover ratio and further suggests acceleration in the company's vendor payment process over recent years.

Payables Turnover Ratio

Maintains relative stability initially, slight dip at the end of 2022, followed by a gradual upward trend into 2025, reaching 0.21.

Average Payables Payment Period

Starts extremely high, peaks in late 2021, then exhibits a consistent downward trend, decreasing to approximately 1700 days by 2025.

Interpretation

The inverse movement between the two ratios illustrates an improving efficiency in accounts payable management, reflecting swifter payment cycles over time.