Artificial intelligence (AI) software provider Palantir beat Wall Street estimates and raised its full-year outlook amid the ongoing AI boom. The company’s revenue grew by 48% during the period, reaching one billion U.S. dollars for the first time. The business saw a boost following a move by President Donald Trump aimed at reducing government spending. On Monday, the company exceeded expectations by surpassing one billion USD in quarterly revenue for the first time. [1] Shares rose three percent in after-hours trading.
Exceeding Expectations
Compared to estimates from the global financial market data provider London Stock Exchange Group (LSEG), Palantir’s adjusted earnings per share reached 16 cents, beating expectations of 14 cents. Its revenue hit one billion USD, surpassing the projected 940 million USD. During the reported period, the company’s revenue grew by 48%. Analysts had not expected the Denver-based company — the capital of the U.S. state of Colorado — to reach one billion USD in revenue before the fourth quarter of this year. [2]
Company Revolution
Palantir CEO Alex Karp told Morgan Brennan of U.S. business news channel CNBC that the company plans to boost its revenue while reducing its headcount. “It’s a crazy, efficient revolution. The goal is to achieve ten times the revenue with 3,600 employees. Right now, we have 4,100,” he stated. He did not specify whether the company would lay off employees to reach that target number.
Revenue Growth
The company’s revenue in the United States increased by 68% year-over-year to 733 million USD, while U.S. commercial revenue nearly doubled compared to the previous year, reaching 306 million USD. [3]
Political Impact on the Company
The company experienced a rise in revenue linked to U.S. President Donald Trump's campaign focused on streamlining the government, which involved layoffs and contract reductions. Palantir’s revenue from U.S. government contracts increased by 53% year-over-year, reaching 426 million USD. In a letter to shareholders, [4] the company’s CEO described this as a steep and rapid rise, which he said reflects a remarkable convergence of language models, the chips required to power them, and the company’s software infrastructure.
Quarterly Results
During the current quarter, the company reported closing 66 deals worth at least 5 million USD and 42 deals worth at least 10 million USD. The total value of its contracts rose by 140% year-over-year to 2.27 billion USD. Last week, the company also secured a contract with the U.S. Army to supply software and data worth 10 billion USD.
Net income increased by 144% to approximately 326.7 million USD, or 13 cents per share, from about 134.1 million USD, or six cents per share a year ago. The company’s stock has more than doubled this year as investors bet on its artificial intelligence tools and government contracts.
Market Value
The company’s market capitalization surpassed 379 billion USD, placing it among the 20 most valuable U.S. companies. It overtook Salesforce, IBM, and Cisco, and entered the top 10 most valuable American tech firms by market cap. Shares hit a new all-time high on Monday. Given the company's size, investing in its stock requires paying high multiples. According to FactSet, the stock is currently trading at 276 times future earnings. Tesla is the only other company in the top 20 with a triple-digit ratio, trading at 177.
Palantir's Stock Price Performance Over the Past Five Years (Source: Google Finance) *
Raised Forecasts
Palantir has also raised its full-year forecasts. For the entire year, the company now expects revenue in the range of $4.142 billion to $4.150 billion, an increase from the previous projections of $3.89 billion to $3.9 billion. For the third quarter, the company forecasts revenue between $1.083 billion and $1.087 billion, surpassing analysts’ estimate of $983 million. The company also raised its forecasts for operating profit and full-year free cash flow. [5]
[1] [2] [3] [4] [5] Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or on the current economic environment, which may change. Such statements are not guarantees of future performance. They involve risks and other uncertainties that are difficult to predict. Results may differ materially from those expressed or implied in any forward-looking statements.
* Past performance is no guarantee of future results.
Sources:
https://www.cnbc.com/2025/08/04/palantir-pltr-q2-earnings-2025.html
https://www.cnbc.com/2025/08/05/palantir-stock-earnings-ai-karp.html
