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Plant Labs Inflates Sales $4.2 Million With Out of Period Adjustment
Satellite company’s revenue would’ve been 4.2% lower without unexplained correction.
December 17, 2022
Investors cheered record revenue in the latest quarterly results from Planet Labs (PL), a satellite imagery company, but a closer reveals the results weren’t as good as advertised. The company beat sales estimates by $2.5 million. Further scrutiny reveals almost all of the beat came as a result of an out of period correction.
Instead of a footnote calling attention to the adjustment on the Income Statement, Planet Labs inserted a new sentence in its “Basis of Presentation” section that quantified the unexplained adjustment:
“Revenue for the three months ended October 31, 2022 includes an out of period adjustment of $2.1 million.”
Without the adjustment, Plant Labs grew sales 50.5%, approximately 620 bps slower than headlines suggest.
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