Palo Alto Networks Inc (PANW)

The analysis of Palo Alto Networks Inc’s days of sales outstanding (DSO) over the specified period reveals significant fluctuations that illuminate shifts in the company’s receivables management and credit policies. Initially, at October 31, 2020, the DSO was approximately 68.82 days, which indicates that on average, the company collected its receivables in nearly 69 days. This period remained relatively stable through early 2021, with figures such as 64.57 days in January 2021 and increasing modestly to 70.20 days by April 2021.

However, a notable escalation occurred in mid-to-late 2021 and into 2022. For example, by July 31, 2021, the DSO jumped to approximately 106.38 days, indicating a slowdown in receivables collection processes or a change in credit terms extending the collection period. Subsequently, the DSO fluctuated but trended upward, reaching 142.15 days by July 31, 2022, representing a substantial increase relative to earlier periods. This indicates that the company was, on average, taking over 4.5 months to collect receivables during this period, which could signal extended credit terms, collection challenges, or shifts in customer payment behaviors.

Following this peak, the DSO showed signs of fluctuation but remained elevated compared to initial levels. By October 31, 2022, it settled at approximately 77.68 days, and in early 2023, it persisted around 75.78 days. However, the upward trend resumed markedly by the third quarter of 2023, where the DSO reached approximately 151.03 days, the highest in the dataset. This suggests a significant deterioration in collection efficiency or possibly strategic changes in credit extension, which may reflect increased credit risk acceptance or delays in customer payments.

The trend continued into early 2024, with the DSO decreasing somewhat to 113.55 days in January but again escalating to approximately 152.07 days by July 31, 2024. The most recent data point shows a reduction to 85.35 days as of October 31, 2024, followed by another increase to 95.84 days in January 2025 and subsequent variations up to 145.64 days projected for July 2025.

Overall, the DSO trajectory indicates periods of stability, followed by substantial increases indicative of extended receivables collection times. The peaks in mid-2022 and mid-2023, notably exceeding 140 days, suggest periods of potential collection challenges or deliberate credit policy shifts. The variability and general upward trend over the observed timeframe underscore the importance of monitoring receivables collection efforts, credit risk management, and potential implications for cash flow and working capital stability.