Palantir Technologies Inc. Class A Common Stock (PLTR)

Cash conversion cycle

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Days of inventory on hand (DOH)	days	—	—	14.51	39.39	38.60
Days of sales outstanding (DSO)	days	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—
Cash conversion cycle	days	0.00	0.00	14.51	39.39	38.60

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + — – —
= 0.00

The cash conversion cycle of Palantir Technologies Inc. Class A Common Stock has shown a fluctuating trend over the past few years. In December 2020, the company's cash conversion cycle stood at 38.60 days, indicating the time taken to convert its investments in inventory and accounts receivable into cash and then reinvest that cash back into the business.

By December 2021, the cash conversion cycle increased slightly to 39.39 days, suggesting a potential strain on the company's liquidity and operational efficiency. However, there was a significant improvement in efficiency by December 2022, with the cycle reducing to 14.51 days. This indicates that Palantir was able to manage its working capital more effectively during this period.

The most noteworthy development came in December 2023 and 2024 when the cash conversion cycle dropped to 0.00 days. A cash conversion cycle of zero signifies that the company is able to convert its investments into cash almost immediately, showcasing strong liquidity and efficient working capital management. This could imply that Palantir has optimized its cash flows and operational processes to a high degree.

In conclusion, while there have been fluctuations in Palantir's cash conversion cycle over the years, the trend towards lower or even zero days in recent years indicates improved working capital management and operational efficiency.