Palantir Stock Is Tumbling Tuesday Despite Beating Q1 Estimates: What's Going On?

Palantir Technologies, Inc. PLTR shares are trading lower on Tuesday after the company reported first-quarter earnings on Monday.

Despite beating consensus estimates, the stock may be facing pressure amid elevated investor expectations. Shares of Palantir have climbed 409% over the past year and 44% year-to-date.

The Details: Palantir reported adjusted earnings per share of 13 cents, inline with the consensus estimate. In addition, the company reported sales of $883.86 million, beating the consensus estimate of $862.83 million and representing a 39% year-over-year increase.

Palantir reported a total U.S. commercial contract value of $810 million, with remaining deal value totaling $2.32 billion.

The company’s customer count increased 39% year-over-year.

“Our Rule of 40 score increased to 83% in the last quarter, once again breaking the metric. We are in the middle of a tectonic shift in the adoption of our software, particularly in the U.S. where our revenue soared 55% year-over-year, while our U.S. commercial revenue expanded 71% year-over-year in the first quarter to surpass a one-billion-dollar annual run rate,” said Alexander C. Karp, co-founder and CEO of Palantir Technologies.

Outlook: The company raised its guidance for fiscal-year 2025 sales. It now sees sales from $3.89 billion to $3.90 billion, versus the consensus estimate of $3.75 billion. It previously expected earnings from $3.74 billion to $3.76 billion.

For the second-quarter, the company sees sales from $934 million to 938 million, versus the consensus estimate of $899.12 million.

Analyst Changes: Following the earnings report, multiple analysts issued price target adjustments.

• Mizuho analyst Matthew Broome maintained an Underperform rating on Palantir and raised the price target from $80 to $94.
• Cantor Fitzgerald analyst Thomas Blakey maintained a Neutral rating on Palantir and raised the price target from $98 to $110.
• UBS analyst Karl Keirstead maintained a Neutral rating on Palantir and raised the price target from $105 to $110.

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PLTR Price Action: At the time of writing, Palantir shares are trading 12.8% lower at $107.92, according to data from Benzinga Pro.

Image: via Shutterstock