Palantir Technologies reported record quarterly revenue of $1.18 billion and raised its annual revenue outlook to $4.4 billion, citing accelerating growth for its artificial intelligence and data analytics products as the company benefits from surging government defence contracts and commercial AI adoption.
Revenue increased 63 per cent in the period ended in September, whilst net profit reached $475.6 million, both ahead of analyst expectations, reports Bloomberg. The company forecast sales of about $1.33 billion in the current quarter, compared with an average projection of $1.19 billion. Palantir has reported revenue above analyst estimates for 21 consecutive quarters.
“We are in a nosebleed zone,” Palantir Chief Executive Officer Alex Karp said in an interview on Monday. “No one else is here.”
Profit, excluding some items, was 21 cents a share, compared with analysts’ average estimate of 17 cents. The company’s market capitalisation has reached $475 billion.
Palantir’s commercial business has been growing rapidly, particularly in the US. The company’s quarterly sales to commercial customers in the country increased by 121 per cent from the same period a year earlier, generating $397 million. Palantir’s government work in the US increased 52 per cent in the third quarter to $486 million.
The Denver-based firm, which sells software to centralise, manage and analyse large amounts of data, has gained more government contracts in recent weeks, including a $100 million contract with the Internal Revenue Service and $400 million award from the State Department, reports The Wall Street Journal.
The company last week announced a partnership with Nvidia that would involve utilising state-of-the-art AI chips to enable Palantir’s software to run more efficiently. It is the latest in a string of corporate partnerships Palantir has announced as it aims to expand its commercial and defence offerings.
Backed by the CIA
Founded in 2003 with backing from Peter Thiel and the venture arm of the CIA, Palantir’s software organises information from disparate data sources. It utilises AI tools to make decisions more quickly. In corporate settings, this can involve finding ways to reduce expenses. On the battlefield, the company says this can mean shortening the time from identifying a threat to neutralising it.
Palantir is also seeking growth overseas, with new business in the UK, Poland, Saudi Arabia and Ecuador. Europe’s push to rearm in the face of Russia’s aggression has been a boon for Palantir’s defence business in North Atlantic Treaty Organisation countries.
In a letter to investors, Karp said that the company’s ascent “has confounded most financial analysts and the chattering class, whose frames of reference did not quite anticipate a company of this size and scale growing at such a ferocious and unrelenting rate”.
Since its market debut via a direct listing in 2020, Karp has built a dedicated following among retail investors who affectionately call him “Daddy Karp” on Reddit. At the same time, he has antagonised Wall Street and dismissed calls to reverse Palantir’s strong support for Israel and for US border enforcement.
