Palantir (PLTR) Earnings Report Sparks Debate: Bullish Commercial Growth vs Bearish Concerns

• Palantir Technologies (PLTR) recently reported its first-quarter earnings, meeting expectations and exceeding revenue predictions.
• The company’s revenue guidance for Palantir stock was slightly above Wall Street’s forecasts.
• “Palantir’s Q1 top-line results came ahead of expectations,” said Morgan Stanley analyst Keith Weiss.

Palantir Technologies reports Q1 earnings and revenue that surpass expectations, with a particularly strong performance in the U.S. market.

Palantir’s Q1 Earnings

Palantir’s earnings for the quarter ending March 31, using generally accepted accounting principles (GAAP), were 8 cents a share, marking a 60% increase from the previous year. The software maker’s revenue rose by 21% to $634 million. Analysts had predicted earnings of 8 cents a share on revenue of $615 million.

Government Sales Exceed Predictions

Palantir reported that government revenue rose by 16% to $335 million, surpassing estimates of $322 million. Commercial revenue also increased by 27% to $299 million, topping estimates of $292 million. U.S. commercial revenue saw a 40% rise, and the company closed 136 U.S. commercial deals in the quarter, up from 70 in Q1 2023.

Palantir’s AI Platform

William Blair analyst Louie DiPalma noted that the stock likely fell due to a sharp deceleration in U.S. commercial revenue growth. However, he also highlighted the company’s focus on artificial intelligence (AI). For the current quarter ending in June, Palantir expects revenue of $651 million at the midpoint of guidance, slightly above analysts’ predictions of $643 million.

Palantir Among AI Stocks To Watch

Palantir’s stock has risen by 44% in 2024 and 233% over the past year, largely due to excitement over generative AI technology. The company launched its “Artificial Intelligence Platform” in early 2023 and is considered one of the AI stocks to watch. Palantir is now looking to use generative AI to spur growth in the commercial market, having already leveraged AI with government customers for intelligence gathering, counterterrorism, and military purposes.

Conclusion

Palantir’s Q1 earnings and revenue exceeded expectations, with particularly strong performance in the U.S. market. The company’s focus on AI and its potential in the commercial market make it a stock to watch. However, the sharp deceleration in U.S. commercial revenue growth is a concern that investors should monitor closely.