Alex Karp, CEO of Palantir Technologies, speaks at the AIPCon conference in Palo Alto, California, USA on March 13, 2025.
David Paul Morris | Bloomberg | Getty Images
Palantir reported quarterly results that beat analysts’ expectations and issued better-than-expected guidance for the fourth quarter, with much of its strength attributed to artificial intelligence.
The company’s shares, which have soared 25 times over the past three years, initially rose in after-hours trading, but have since fallen about 4%.
Here’s how the company performed compared to LSEG’s estimates:
Earnings per share: 21 cents adjusted, 17 cents expected; Revenue: $1.18 billion, $1.09 billion expected.
Palantir, which makes analytical tools for large businesses and government agencies, expects sales of about $1.33 billion for the current fiscal year, beating analysts’ expectations of $1.19 billion, LSEG said.
This optimistic guidance comes even as the government shutdown enters its second calendar month and could threaten some key contracts. Palantir’s U.S. government business revenue increased 52% year over year to $486 million in the quarter.
Government sales, particularly sales from military agencies, are central to Palantir’s continued rise. Over the years, Palantir has been steadily beating out large traditional government contractors, most recently winning a contract worth up to $10 billion with the U.S. Army.
Palantir has also faced criticism for how the tool is used by government agencies, including U.S. Immigration and Customs Enforcement.
Total revenue for the quarter was up 63% from $725.5 million in the year-ago period, marking the second consecutive quarter of more than $1 billion. Net income more than tripled to $475.6 million, or 18 cents a share, from $143.5 million, or 6 cents a share, a year earlier.
Palantir expects full-year sales of about $4.4 billion, beating Wall Street’s forecast of $4.17 billion. The company also raised its full-year free cash flow outlook to $2.1 billion from $1.9 billion.
Palantir’s U.S. commercial business more than doubled to $397 million. Total U.S. commercial deals closed more than quadrupled to $1.31 billion. Over the past few weeks, the company has announced new partnerships with the following companies: snowflake, lumen and Nvidia.
Individual investors helped propel Palantir’s stock price to new heights. The stock has soared more than 170% this year, giving the company a market capitalization of more than $490 billion and solidifying its position as one of the world’s most valuable technology stocks.
Analysts have expressed concern that the stock trades at extremely high multiples compared to tech giants with much higher revenues. In a letter to shareholders, CEO Alex Karp accused “detractors” of being “left in some sort of deranged and self-defeating mess.”
“The reality is that Palantir has made it possible for individual investors to achieve rates of return that were previously limited to Palo Alto’s most successful venture capitalists,” he wrote. “And we have achieved that through real and substantial growth.”
In an interview with CNBC’s Morgan Brennan on Monday, Karp acknowledged that there is a glut in today’s AI market and that some companies will eventually feel the pain.
“The strong companies are going to get even stronger, and the people who are pretending to be doing something are going to disappear quickly,” Karp said.
Watch: Luria of Palantir by DA Davidson
