Analysis

Palantir Tops Revenue, Meets EPS Expectations

Palantir’s Q1 performance got a boost from a 40% year-over-year increase in U.S. commercial revenue.

Data analytics specialist Palantir Technologies (PLTR 8.06%) reported first-quarter 2024 earnings on Monday, May 6, that surpassed revenue predictions and met expectations for adjusted earnings per share (EPS). Multiple metrics provided suggest Palantir is seeing substantial growth and improving its operational efficiency.

The data table below highlights some of the financial milestones reached:

Metric Q1 2024 Analyst Estimate Q1 2023 Change (YOY)
Revenue $634.3 million $615.4 million $525.2 million 21%
Adjusted EPS $0.08 $0.08 $0.05 60%
GAAP EPS $0.04 N/A $0.01 300%
GAAP net income $105.5 million N/A $16.8 million 528%
Adjusted net income $196.9 million N/A $107.4 million 83%

Data sources: Company results from Palantir. Analyst estimates from FactSet. YOY = Year over year. EPS = Earnings per share. GAAP = Generally accepted accounting principles.

Company overview

Palantir Technologies specializes in data analytics, providing software solutions that help organizations integrate, manage, and analyze large volumes of data. Its key platforms, such as Gotham and Foundry, serve a diverse clientele that includes governments and commercial entities. Palantir is working to expand its artificial intelligence (AI) capabilities and strengthen its U.S. commercial sector presence. Both are critical to its current (and future) success. Innovations like the Palantir Artificial Intelligence Platform (AIP) and partnerships with global entities emphasize its commitment to maintaining a competitive edge while addressing evolving market demands.

Quarterly highlights

Palantir’s first-quarter performance was driven by a 40% year-over-year increase in U.S. commercial revenue, reaching $150 million. This surge reflects the company’s strategic efforts to broaden its market reach and deepen customer relationships, particularly in the commercial segment where it has been actively growing its footprint.

Its U.S. commercial customer count grew 69% year over year to 262 customers. On the government side, revenue of $335 million rose 16% from Q1 2023. Its customer count saw a healthy 42% year-over-year growth.

Revenue jumped 21% year over year to $634 million, a 21% year-over-year increase, and it was complemented by Palantir’s operational efficiency, which managed to convert that revenue into adjusted EPS of $0.08 and a GAAP EPS of $0.04. This was Palantir’s sixth straight quarter of GAAP profitability.

Looking ahead

Palantir management has emphasized its commitment to innovation and market expansion. Strategic collaborations, including a significant new one with Oracle for cloud and AI solutions, are key in improving the company’s performance, especially on the commercial side. Despite challenges such as competitive pressures and valuation concerns, Palantir’s forward-looking strategies underscore its determination to secure and extend its market position.

Palantir’s management remains optimistic, projecting continued revenue growth and sustained profitability. Palantir raised its full-year 2024 revenue guidance to between $2.68 billion to $2.69 billion (up from between $2.65 billion and $2.67 billion previously). It raised U.S. commercial revenue guidance to exceed $661 million (implying a growth rate of at least 45%).

Increased emphasis on AI initiatives, alongside strategic market expansions and partnerships, will be pivotal for the company’s future trajectory. Investors are encouraged to monitor these efforts closely, particularly the adoption and impact of AIP across new and existing customer segments, which signify potential for further growth and market penetration.

JesterAI is a Foolish AI, based on a variety of Large Language Models (LLMs) and proprietary Motley Fool systems. All articles published by JesterAI are reviewed by our editorial team, and The Motley Fool takes ultimate responsibility for the content of this article. JesterAI cannot own stocks and so it has no positions in any stocks mentioned. The Motley Fool has positions in and recommends Oracle and Palantir Technologies. The Motley Fool has a disclosure policy.

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