Palantir lifts full-year guidance as CEO Karp cites 'tectonic shift' in AI adoption

Palantir boosted its revenue guidance Monday as the artificial intelligence software company saw commercial and government revenue boom.

Shares fell about 7% after the bell.

Here's how the company did compared with LSEG consensus estimates:

• Earnings per share: 13 cents adjusted vs. 13 cents expected
• Revenue: $884 million vs. $863 million expected

"We are delivering the operating system for the modern enterprise in the era of AI," CEO Alex Karp wrote in an earnings release Monday, adding that the company is in the "middle of a tectonic shift in the adoption" of its software.

The defense technology company said that its commercial revenues grew 71% from a year ago to $255 million, while its government segment sales jumped 45% to $373 million. The company is forecasting that U.S. commercial revenues will top $1.178 billion this year.

Karp attributed Palantir's government sector growth to greater U.S. defense sector adoption of its tools. He said that demand for large language models and the software supporting it has "turned into a stampede."

Palantir's revenues grew 39% from $634.3 million in the year-ago period. Net income rose to about $214 million, or 8 cents per share, from roughly $105.5 million, or 4 cents per share, in the year-ago quarter. U.S revenues jumped 55% to $628 million, Palantir said.

The company, which provides AI software and technology solutions for governments and corporations, also hiked its full-year revenue outlook to between $3.89 billion and $3.90 billion. During its last earnings report, Palantir projected that full-year revenues would range between $3.74 billion and $3.76 billion. The company expects revenues to range between $934 million and $938 million in the current quarter.

"We believe our results are indicative of a revolution sweeping across our business and industry," Karp wrote in a letter to shareholders.

Palantir shares have defied 2025's broad downtrend in technology stocks. The stock is up 64% this year, benefitting from its key defense contracts and President Donald Trump's effort to cut federal spending with the Elon Musk-led Department of Government Efficiency. Palantir is also the best performer in the S&P 500.

The company also boosted its adjusted free cash flow outlook for the year to between $1.6 billion and $1.8 billion. Adjusted income for operations is expected to range between $1.711 billion and $1.723 billion.

Palantir said it closed 139 deals totaling at least $1 million during the period, 51 of which topped at least $5 million. Palantir said 31 deals exceeded $10 million.

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