Palantir saw its stock jump by 7% on Monday after it reported its third-quarter numbers that beat estimates from Wall Street analysts and pushed guidance higher into the fourth quarter. The company posted $1.18 billion in revenue, outperforming the $1.09 billion predicted by analysts.
According to the report, earnings hit 21% peer share, topping the 17 cents that analysts expected. The software firm, known for supplying data tools to the US government and large corporations, said it expects $1.33 billion in its Q4 revenue. This figure is well above analysts’ estimates of $1.19 billion. This also comes amid the ongoing government shutdown, which is now in its second month and has been putting federal contracts at risk. Regardless, Palantir mentioned that government revenue rose 52% year-over-year, hitting a total of $486 million in Q3.
Palantir stock rises as commercial business explodes
Palantir has relied on defense contracts over the past few years, with those deals still very much coming. One of the largest contracts remains its multi-year agreement with the US Army, which could reach up to $10 billion. The company also came under fire for how its software was being used by agencies like Immigration and Customs Enforcement, but failed to address the complaints this quarter.
The full-year outlook has now been released, and Palantir expects $4.4 billion in revenue for 2025, up from the Wall Street prediction of $4.17 billion. In addition, free cash flow is now projected to land between $1.9 billion and $2.1 billion by year’s end. CEO Alex Karp said the company’s growth was driven by real demand, not hype. Commercial revenue more than doubled to $397 million in Q3.
The total value of signed commercial contracts shot up to $1.31 billion, over four times higher than a year earlier. The company also signed new partnerships in recent weeks with Snowflake, Lumen, and Nvidia, a move to strengthen its commercial reach. Total revenue rose 63% from the same quarter last year, when the company made $725.5 million.
Net income also jumped more than 230% to $475.6 million, or 18 cents per share, compared to $143.5 million, or 6 cents per share, the previous year. Palantir shares are now up by over 170% since the start of 2025, giving it a market cap above $490 billion. That puts it among the largest tech companies globally by valuation. However, analysts have flagged concerns over the stock’s extreme valuation, especially when compared to much larger software firms with higher revenues.
“The reality is that Palantir has made it possible for retail investors to achieve rates of return previously limited to the most successful venture capitalists in Palo Alto. And we have done so through authentic and substantive growth,” Alex Karp, CEO and co-founder of Palantir, said in his letter to shareholders. The comment also follows his jab at critics, who he said had been “left in a kind of deranged and self-destructive befuddlement.”
