Palantir Technologies beat Wall Street’s high expectations for third-quarter revenue and profit amid huge sales growth in the software giant’s artificial intelligence and data analytics products.
The Denver-based company said that revenue grew 63 per cent to $1.18 billion in the three months to the end of September, beating consensus forecasts of $1.09 billion. Net income rose 231 per cent year-on-year to $475.6 million.
Alex Karp, Palantir’s chief executive, said the company’s commercial business in the US had become “an absolute juggernaut”, growing 121 per cent on last year to generate revenue of $397 million in the quarter.
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Palantir raised its annual sales forecast to $4.4 billion, up from its previous outlook of up to $4.15 billion. The company’s sales have surged on the back of the artificial intelligence boom.
The company, founded in 2003 by a group including Karp and Peter Thiel, the billionaire co-founder of PayPal, builds software that organises and analyses troves of data for governments and companies in an effort to improve decision-making.
It was originally started to build software for US intelligence agencies to assist in counterterrorism investigations and operations with the goal of preventing another 9/11-scale attack. It later expanded to work with corporate clients facing similar challenges in working with data.
Palantir has built four principal software platforms. They include Gotham and Foundry, which allow organisations to integrate massive amounts of information into a data platform that reflects their operations. The company builds an “ontology”, or digital twin of an organisation, which takes datasets and connects them to real-world counterparts, ranging from physical assets such as plants and equipment to customer orders or financial transactions.
There has been huge growth in Palantir’s corporate revenues since it launched its artificial intelligence platform in April 2023, five months after OpenAI unveiled ChatGPT and the world began to understand the power of generative AI. The platform combines Palantir’s machine-learning technologies with the latest large-language models. When it launched, Karp said: “Our software and company were built for this moment.”
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He bet that the deployment of the latest AI models across a range of industries would only be possible using the kind of platforms, developed by Palantir, that can ensure they are used within the legal and regulatory confines of their businesses.
Palantir’s revenue from the US government rose 52 per cent in the third quarter to $486 million.
The company also has contracts with western militaries and governments, including in the UK, where it works with the NHS.
Palantir’s stock, already at a record and up 400 per cent from a year ago, edged up $0.55, or 0.3 per cent, to $207.73 in after-hours trading on Monday.