Palantir posts first profitable quarter, stock soars after earnings


Palantir Technologies Inc. logged its first-ever quarterly profit in the fourth quarter, and the company expects to continue on that trajectory this year.

The data-software company reported Monday afternoon that it saw fourth-quarter net income of $31 million, or 1 cent a share, whereas it lost $156 million, or 8 cents a share, in the year-earlier period. Palantir

also anticipates it will be profitable on a GAAP basis in 2023.

Chief Executive Alex Karp originally was targeting GAAP profitability in 2025.

“Our commitment to and relentless focus on the long term at times has required patience,” Karp said in the latest shareholder letter. “At other times, as our profitability demonstrates, we will deliver results at a rate that surpasses even the expectations of those who believed that we would prevail.”

Chief Financial Officer David Glazer told MarketWatch that Palantir’s GAAP profit reflects the company’s focus on expense management and also on bringing down stock-based compensation.

The combination of Palantir’s GAAP profit and top-line growth “leaves us very, very excited,” he said.

The stock was up more than 15% in after-hours trading Monday.

Read: Microsoft has a long path of earnings growth ahead, says Morgan Stanley

On an adjusted basis, Palantir generated earnings per share of 4 cents, while analysts tracked by FactSet were expecting 3 cents.

Revenue rose 18% to $509 million from $433 million a year ago, whereas the FactSet consensus was for $503 million.

The company continues to see macroeconomic crosswinds, but Glazer told MarketWatch that “there are certain parts of that that create a lot of opportunity for us,” as some of Palantir’s customers look to “do more with less.”

Palantir said its commercial revenue grew 11% in the fourth quarter, while U.S. commercial revenue was up 12%. Overall government revenue increased 23%, whereas U.S. government revenue rose 22%.

Chief Revenue Officer Ryan Taylor sees the “foundation for U.S. commercial to reaccelerate going forward.”

See also: AI is dominating the action in the stock market right now

For the first quarter, Palantir expects $503 million to $507 million in revenue, whereas analysts were expecting $503 million. Glazer said that the company’s first-quarter outlook implies 20% year-over-year growth in revenue when excluding the impact from strategic investments.

For the full year, Palantir anticipates $2.18 billion to $2.23 billion in revenue. The FactSet consensus was for $2.28 billion.


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