Palantir forecasts strong quarterly revenue on AI demand

By Jaspreet Singh

Nov 2 (Reuters) - ‌Palantir Technologies forecast ​revenue ​above estimates for the last three months of the year after topping third-quarter expectations, banking on sustained demand for its ‌data-analytics software from the US government and commercial clients.

The company ⁠expects fourth-quarter revenue to be between $2.649 billion and $2.653 billion, it said on Monday, above ‌LSEG-compiled analysts' average estimate of $2.46 ‌billion.

However, shares fell nearly 3% in extended trading.

"On the negative side, some investors may be disappointed with the US commercial bookings," William Blair ​analysts said.

The growth in US commercial total contract value – the potential lifetime value of signed contracts – slowed to 11% year-over-year in the ⁠third quarter, from more than 153% in the previous quarter.

Palantir said it signed multiple eight-figure deals ​in the quarter that were "shorter in duration than usual" as customers rapidly adopted initial sovereign AI capabilities, which allow ​enterprises to retain control over their data ‌and how AI is deployed and used.

In the third quarter, revenue from commercial clients surpassed government revenue in the ⁠US for the first time, driven by the rapid adoption of AI software to improve operations and safeguard sensitive data.

Palantir, which develops the Maven Smart System ⁠used by NATO's military headquarters and several European armed forces, built its business around ​government and defense contracts.

Total quarterly revenue jumped about 96% to $2.31 billion, the second straight quarter of 90% growth. Analysts had estimated revenue of $2.18 billion.

US commercial revenue was $984 million, ‌while US government revenue came in at $953 million during the period.

The company reported a total of 1,090 customers ‌in the trailing 12-month period ending September 30, with 904 classified as ⁠commercial.

Palantir also raised its annual revenue ‌expectations to between $8.530 billion ​and $8.534 billion, up from its prior estimates of between $8.150 billion and $8.158 billion.

(Reporting by Jaspreet Singh in Bengaluru; Editing by ‌Sriraj Kalluvila)

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