Palantir Breaks the $1 Billion Barrier
Palantir has officially crossed the $1 billion revenue milestone for the first time, a surge fueled by booming demand for artificial intelligence software and lucrative U.S. government contracts. The Denver-based analytics giant beat Wall Street expectations and sharply raised its full-year outlook, sending shares up 3% in after-hours trading.
Earnings and Revenue Smash Forecasts
For the quarter, Palantir reported adjusted earnings of 16 cents per share, topping the expected 14 cents. Revenue climbed 48% year over year to $1 billion, beating analyst forecasts of $940 million. Many had predicted the company would hit this mark only in the fourth quarter, making the achievement a significant surprise.
CEO Sees Leaner Growth Ahead
“We’re planning to grow our revenue while decreasing our number of people,” CEO Alex Karp told CNBC. He outlined a vision of generating 10 times more revenue with just 3,600 employees, compared to the current 4,100. Karp did not specify whether layoffs were part of that plan but called the approach a “crazy, efficient revolution.”
Full-Year Outlook Raised
Palantir now expects 2025 revenue between $4.142 billion and $4.150 billion, up from earlier guidance of $3.89 billion to $3.90 billion. For the third quarter alone, the company projects revenue between $1.083 billion and $1.087 billion — well above the $983 million analysts predicted. It also increased its operating income and free cash flow targets.
Government Contracts Drive U.S. Growth
U.S. revenue jumped 68% from last year to $733 million. Government contracts accounted for a large portion, with U.S. government revenue up 53% to $426 million. Commercial business also soared, with U.S. commercial revenue nearly doubling to $306 million. Much of this growth stems from President Donald Trump’s push for government cost-cutting, which opened new contract opportunities for the company.
A Confluence of AI and Infrastructure
In a letter to shareholders, Karp credited the growth to “the remarkable confluence of language models, the chips necessary to power them, and our software infrastructure.” During the quarter, Palantir closed 66 deals worth at least $5 million and 42 worth at least $10 million, driving total contract value up 140% year over year to $2.27 billion.
Profits and Market Value Surge
Net income jumped 144% to $326.7 million, or 13 cents per share, compared with $134.1 million, or 6 cents per share, last year. Investor confidence has propelled Palantir’s market value to $379 billion, placing it among the 10 most valuable U.S. tech companies — ahead of Salesforce, IBM, and Cisco.
New Army Contract Adds Momentum
Adding to the momentum, Palantir recently secured a $10 billion software and data contract with the U.S. Army. Shares hit a new record high Monday, though they trade at a steep 276 times forward earnings — a multiple topped only by Tesla at 177 among top 20 U.S. companies.
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