Palantir Jumps on Record Quarterly Sales Growth

Mandeep Singh, Bloomberg Intelligence Senior Tech Industry Analyst, discusses what's behind Palantir's record quarterly sales growth.

Palantir Technologies Inc. reported its biggest-ever quarterly sales growth since the company went public, citing the “astonishing impact” of artificial intelligence technology on its business.

Second-quarter revenue jumped 48% to more than $1 billion, the company said in a statement Monday. The data software company also raised its sales outlook for the full year to a range of $4.14 billion to $4.15 billion, exceeding analysts’ prior expectation of $3.91 billion.

Palantir shares rose as much as 9.8% to $176.33 after markets opened in New York on Tuesday, marking an all-time high. Denver-based Palantir has seen its stock price surge more than 500% over the past year — buoyed by high expectations from investors, growth in demand for AI tools, and a deep reach into both the private and public sectors.

The company’s $1 billion revenue in the period ended June 30 exceeded analysts’ average estimate of $939 million. Growth was particularly strong in the US, where sales jumped 68% to $733 million, the company said in the statement.

Palantir said adjusted earnings per share for the quarter were 16 cents, exceeding analyst expectations of 14 cents.

In a letter to shareholders, Chief Executive Officer Alex Karp lingered on the company’s at-times tenuous relationship with Wall Street. “The skeptics are admittedly fewer now, having been defanged and bent into a kind of submission,” he wrote.

He also said that AI breakthroughs had helped fuel Palantir’s growth, pointing to the development of large language models and the chips required to power them. Going forward, Karp said that Palantir planned to be the “dominant software company of the future,” and added, “the market is now waking up to this reality.”

The company’s US government revenue climbed 53% in the quarter to hit $426 million. Meanwhile, its revenue from commercial contracts in the US climbed even quicker, rising 93% for the year to hit $306 million.

The “outperformance” in Palantir’s US commercial business is a key indicator of robust demand, particularly for the company’s AI products, Jordan Berger, an analyst at Third Bridge, said in a note.

“We continue to hear from experts that Palantir maintains unique market positioning for monetizing AI technology amid a noisy, crowded, and hype-laden market, and the company’s Q2 2025 performance further validates that sentiment,” Berger said.

Palantir has long played a role as a key US government contractor, working with both the US military, those of allied countries like Ukraine, and partnering with new defense tech startups.

The company solidified its relationship with the Pentagon during the quarter, striking new deals with the US Space Force and US Army, executives said during a conference call after the results.

Palantir also consolidated 15 prime contracts and 60 related contracts with the Army into one single deal — a 10-year, $10 billion arrangement. While the agreement was designed to cut costs for the government and didn’t boost the company’s bottom line, it could provide a template for future federal deals, analysts said.

In his letter to shareholders, Karp emphasized Palantir’s commitment to defense tech, writing that the US is “the most consequential country in the West,” and adding, “it must be protected.”

Karp ended the call with a message to retail investors, thanking them for their support and urging them to be kinder to analysts who doubted Palantir. “Stop talking to all the haters. They’re suffering,” he said.

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