(Bloomberg) — Palantir Technologies Inc. shares jumped after the company gave a full-year revenue forecast that exceeded analysts’ estimates, thanks to what Chief Executive Officer Alex Karp described as “untamed organic growth” in demand for its artificial intelligence software.
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Sales will be about $3.75 billion in 2025, the Denver-based company said Monday in a statement. Adjusted operating income will be about $1.56 billion. Analysts, on average, projected revenue of $3.54 billion and operating profit of $1.37 billion.
Best known for its national security work, and more recently its AI platform, Palantir’s stock surged 340% in 2024. The company rode a wave of investor excitement for AI, and more commercial and government customers started using Palantir’s data analysis software.
Fourth-quarter revenue jumped 36% to $827.5 million, compared with analysts’ average estimate of $775.9 million. Profit, excluding some items, was 14 cents a share. Analysts, on average, estimated 11 cents.
The shares rose as much as 27% to a new record of $106.76 after markets opened Tuesday in New York, their biggest intraday gain in a year.
As the company deepens its connection with the US Defense Department, sales to the US government jumped 45% to $343 million. US commercial revenue gained 64% to $214 million in the period ended Dec. 31.
On a conference call after the results were announced, Palantir Chief Technology Officer Shyam Sankar was asked about the potential effects of US President Donald Trump’s efforts to cut the federal government’s budget led by the Elon Musk-run Department of Government Efficiency.
“Palantir’s real competition is a lack of accountability in government,” Sankar said. “DOGE is going to bring meritocracy and transparency to government” and prompt it to function more like the commercial market.
Palantir projected US commercial sales in 2025 will rise about 54% to $1.08 billion.
Karp, in a letter to shareholders, said Palantir is in “a new phase” and warned against the “technical complacency” of other US companies failing to step up and serve US interests.
“We love disruption,” Karp said on the call. “Disruption at the end of the day exposes things that aren’t working. There’ll be ups and down. There’s a revolution. Some people get their heads cut off.”
The company’s technology is now used across all US military branches, and by American allies in Ukraine and Israel. Palantir also recently expanded one of its deals with the US Army to as much as $619 million through 2028, and extended its AI work with the US Special Operations Command.
As Silicon Valley embraces defense tech firms, Palantir has broadened its work with other tech companies. It tightened an existing partnership with weapons maker Anduril Industries Inc. and struck a new relationship with AI startup Anthropic to bring its large language models to US intelligence and defense operations. The moves represent the beginning of what Palantir executives envision as America’s new defense ecosystem led by software-first companies — not traditional defense firms.
After Trump’s election, investors showed enthusiasm for Palantir stock and the company’s promise to bolster US defense and manufacturing. Sankar in October published what he described as a blueprint for the resurrection of the American industrial base and has often appeared before US Congress to testify in favor of defense innovation and acquisition reform.
“We have to realize that the AI race is winner-take-all and it’s going to be a whole of nation effort that extends well beyond the DoD in order for us as a nation to win,” Sankar said on the call.
Citing the late political scientist Samuel Huntington, Karp wrote that “the rise of the West was not made possible ‘by the superiority of its ideas or values or religion, but rather by its superiority in applying organized violence.’”
(Updates with share move in the fifth paragraph.)
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