Palantir reported third-quarter revenue of $2.31 billion, up 96% year-over-year and beating analyst expectations of $2.18 billion. The company posted adjusted earnings per share of 44 cents versus expectations of 41 cents, and raised full-year revenue guidance.
U.S. commercial revenue reached $984 million, surpassing U.S. government revenue of $953 million for the first time. Commercial contracts jumped 148% from the year-ago quarter. The growth centers on Palantir's AI software that runs frontier models and custom-trains open-weight models without requiring customers to share data with outside AI labs.
Yet the stock traded slightly down on Tuesday despite the earnings beat. The company closed $1.46 billion in total contract value from U.S. enterprises in the quarter, a decline from the record $2.13 billion in the prior quarter.
CEO Alex Karp told Wall Street that enterprises are signing shorter-term contracts and trialing software more quickly than before. "What Ryan and I are seeing on the front line and commercial is this much quicker interaction, much quicker to deployment, shorter duration of the contract but then an ability to expand that contract dramatically," Karp said.
He expressed confidence about customer retention, stating that once enterprises use Palantir, they do not leave. Karp raised U.S. commercial revenue guidance to exceed $3.559 billion, representing growth of at least 143%.