Palantir Technologies Inc. (NYSE: PLTR) once again attracted the attention of investors with its excellent quarterly performance, which represents the company's strategic position in the AI sector. After announcing better-than-expected results and raising the outlook for operating income, Palantir shares jumped as much as 23%[1] to hit a record high of $50.98, the highest since going public in 2020.*

For the third quarter, the company reported a 30% increase in revenue to $725.5 million, beating an estimated $703.7 million, with net income reaching a record $144 million. Thanks to this strong quarter, the company also raised its revenue outlook for 2024 to $2.81 billion, exceeding analysts' expectations of $2.76 billion. [1] CEO Alex Karp expressed satisfaction with the growth and attributed the strong financial performance to high demand in the US. "The world is in the midst of a U.S.-led AI revolution that is reshaping both industry and the economy, and we are right at the center of it," Karp noted in a letter to shareholders.

Growth supported by strong demand in the US

A substantial part of the company's success is anchored in the U.S. market, which accounts for 70% of the quarter's total revenue, or $499 million. The U.S. commercial division, which is a key growth driver for Palantir, rose 54% to $179 million, while revenue from government contracts rose 40% to $320 million. The international demand for Palantir's services does not yet reach the level of the US market. Ryan Taylor, Chief Revenue Officer, attributed this success in the U.S. to a hands-on approach to customers, including training programs to get the most out of their tools.

Taking advantage of opportunities in the AI sector

The demand for Palantir's AI solutions is unprecedented, and the company is benefiting from the global shift towards AI-based technologies. The introduction of new AI tools last year cemented its position as a key player in the field. As a result, the value of its shares increased by almost 200% in 2024.* The recent inclusion in the S&P 500 index only confirms Palantir's credibility and attractiveness in the market.

Palantir continues to deepen technology partnerships, such as with Microsoft, expanding access to OpenAI's large language models even in classified environments. This collaboration and other technological advancements demonstrate a proactive approach to integrating cutting-edge technologies and creating scalable solutions that meet the complex requirements of both government and commercial customers.

Financial strength and positive outlook

Palantir posted adjusted earnings of 10 cents per share, beating the expected 9 cents. The company expects to achieve adjusted operating income of approximately $300 million in the coming quarter, well above the projected $261.6 million. This optimistic outlook reflects management's confidence in continued demand and further growth, especially in the U.S. market. [2]

Future prospects

Palantir's latest results confirm its significant role in the AI-powered technology sector. Palantir's rapid growth in the U.S. market, continued innovation, and strong partnerships with government institutions put it in an advantageous position as AI technologies increasingly redefine industry standards. Sales are expected to grow again in the next fiscal year, with high demand for AI solutions remaining the main driver of this growth. [3]

The performance in the third quarter highlights not only immediate successes, but also a promising trajectory in the fast-growing AI market. With dynamic growth, a positive outlook, and a strong presence in the U.S. government and commercial sectors, Palantir has established itself as a leader in AI and represents an attractive opportunity for investors seeking exposure to the AI market.

* Past performance is not a guarantee of future results.

[1,2,3] Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or on the current economic environment, which is subject to change. Such statements are not a guarantee of future performance. They involve risks and other uncertainties that are difficult to predict. Results could differ materially from those expressed or implied in any forward-looking statements.


[1] Palantir Technologies Inc. stock price performance over the past five years: https://tradingeconomics.com/pltr:us