Palantir reports solid earnings but outlook falls short of expectations – SiliconANGLE

Shares in Palantir Technologies Inc. fell more than 7% in late trading today after the big data analytics company fell short at the midpoint on its outlook, despite reporting otherwise solid figures in its fiscal first quarter.

For its first quarter that ended on March 31, Palantir reported adjusted earnings per share of eight cents, up from five cents in the same quarter of last year, on revenue of $634.3 million, up 21% year-over-year. The adjusted earnings per share were in line with what analysts were expecting, while Palantir’s revenue came in ahead of an expected $625 million.

Adjusted income from operations came in at $226 million in the quarter and cash flow from operations was $130 million. Palantir saw strong growth in its U.S. commercial business, with revenue growing 40% year-over-year to $150 million, driven by the number of U.S. commercial customers growing 69%, to 262. A company that is definitely not going to run out of cash, Palantir ended the quarter with $3.9 billion in cash, cash equivalents and Treasury securities on hand.

In a strongly worded letter to shareholders, Palantir Chief Executive Officer Alex Karp said that the company had been “routinely told by investors that building technical infrastructure for the enterprise market, let alone government agencies, was the surest and quickest way to run a business into the ground” and that many had balked at supporting Palantir. Now, however, he said, the company has proved the skeptics wrong.

“Our business is now growing at a scale and pace that even our most ardent advocates would have been hard-pressed to say was likely, or even possible,” Karp wrote in the letter. “In addition, the profits that we promised would come, and that skeptics repeatedly and confidently said were beyond us, have now arrived.”

“The company faces a massive opportunity to bring AI to the commercial market via its Artificial Intelligence Platform, which our experts indicate remains significantly differentiated from other AI providers,” Jordan Berger, an analyst at the research firm Third Bridge, told SiliconANGLE in an email. “However, despite continued indication of AIP’s early success, there remains a high degree of uncertainty around this nascent market and the role Palantir will ultimately play in it.”

For its fiscal second quarter, Palantir said that it expects revenue of between $649 million to $653 million. However, at the midpoint, the outlook fell short of the $653 million expected by analysts.

For the full fiscal year 2024, the company expects revenue of $2.677 billion to $2.689 billion, falling short of the $271 billion expected by analysts. The twin outlook misses were enough to drive the late selloff of Palantir shares.

Image: Palantir