Palantir Stock Is Falling Tuesday: What's Going On?

Palantir Technologies Inc PLTR shares are trading lower Tuesday after the company reported first-quarter financial results and issued soft guidance. Here’s what you need to know.

What To Know: Palantir said first-quarter revenue increased 21% year-over-year to $634 million, which beat the consensus estimate of $625.431 million, according to Benzinga Pro. Palantir reported adjusted earnings of 8 cents per share, which was in line with analyst estimates. The company has now delivered six straight quarters of GAAP profitability. 

Commercial revenue grew 27% year-over-year, driven by a 40% year-over-year increase in U.S. commercial revenue. Government revenue climbed 16% year-over-year.

Customer count increased 42% year-over-year and 11% on a quarter-over-quarter basis. U.S. commercial customer count grew 69% year-over-year to 262 customers. Palantir ended the quarter with cash, equivalents and short-term U.S. treasury securities of $3.9 billion.

“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,” CEO Alex Karp said in a letter to shareholders.

“In addition, the profits that we promised would come, and that skeptics repeatedly and confidently said were beyond us, have now arrived.”

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Outlook: Palantir expects second-quarter revenue to be between $649 million and $653 million versus estimates of $653.25 million. 

The company also raised its full-year 2024 guidance. Palantir now sees full-year revenue in the range of $2.677 billion to $2.689 billion versus estimates of $2.71 billion. The company also raised its U.S. commercial revenue outlook to in excess of $661 million, representing growth of at least 45%. 

Palantir noted that it continues to expect adjusted free cash flow of between $800 million and $1 billion for full-year 2024. The company also continues to expect GAAP operating income and net income in each quarter of this year.

“Our intention is to make our Artificial Intelligence Platform (AIP) the most dominant infrastructure in the market and power the effective deployment of artificial intelligence and large language models across institutions,” Karp said.

Following the print, Deutsche Bank analyst Brad Zelnick maintained Palantir with a Sell rating and raised the price target from $18 to $20.

PLTR Price Action: Palantir shares were down 13.1% at $21.92 at the time of writing, according to Benzinga Pro.

Photo: Cory Doctorow from Pixabay.