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On the surface, Palantir (PLTR -0.27%) and Oracle (ORCL +3.91%) today have almost the same price tag. As I write, Palantir's market cap is about $447 billion with a share price near $186, while Oracle's is about $425 billion at about $140 a share.

Getting here took a brutal year for Oracle. Its stock has lost about half its value in the past 12 months, while Palantir's shares are up a little in the same stretch.

Under these similar values, though, sit two very different companies. Palantir took in around $6.2 billion in revenue over the last 12 months, less than a tenth of Oracle's $71.8 billion. And it made around $3 billion, versus Oracle's $18.7 billion.

So investors paying around the same for both businesses are betting on very different amounts of future growth. I think one of these bets is much easier to win than the other.

Image source: Getty Images.

Palantir: profits that nearly quadrupledShowing how fast the data analytics software business is scaling, Palantir's net income rose from around $327 million in the second quarter of 2025 to about $609 million in the fourth quarter, then to about $1.06 billion in the second quarter of 2026. Over the past 12 months, profit was around $3 billion, nearly four times the $763 million it made in the previous 12 months. Management expects 2026 revenue of about $8.15 billion, around 82% higher than in 2025.

Palantir also ended June with about $9.2 billion in cash and short-term Treasuries and no borrowings on its balance sheet.

At around 160 times earnings, though, Palantir's stock costs over seven times as much as Oracle's per dollar of profit.

For Palantir to trade at Oracle's price-to-earnings ratio of about 22 without its share price dropping, it'd need to earn about $22 billion a year -- more than Oracle earns now. Getting there in five years would take profit growth averaging around 48% annually.

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Granted, that rate is slower than what Palantir just posted. But five straight years of it is rare for any company, and rivals might make it tougher.

When Oracle reported quarterly results earlier this month, it introduced an AI data platform that it said "fully automates the creation of Enterprise Ontologies" (models of how a business and its data fit together). Oracle's own release credited Palantir with pioneering that approach.

Oracle: accelerating growth, negative cash flowOracle's growth has sped up, too. Revenue climbed 17% over fiscal 2026 (the year ended May 31, 2026). By the fiscal fourth quarter, year-over-year growth had accelerated to 21%. In the fiscal first quarter of 2027 (the period ended Aug. 31, 2026), revenue jumped 30% to $19.3 billion, driven by a 121% gain in cloud infrastructure revenue.

Given that growth, Oracle's stock looks modestly priced. Management expects non-GAAP (adjusted) earnings per share of $8.10 this fiscal year, around 19% above the $6.83 it made in fiscal 2026 excluding one-time investment gains, including the sale of its stake in chip designer Ampere. Shares cost around 17 times that expected profit. Put another way, at this price, Oracle arguably doesn't need much growth after this year.

Oracle's issue is paying for that growth. In fiscal Q1, capital spending of $28.5 billion topped the $23.1 billion of cash its operations took in, and free cash flow over fiscal 2026 was a negative $23.7 billion. Plus, the company sold $20 billion of stock using an at-the-market program in the quarter, issuing around 141 million new shares and lifting its share count by about 5%. At the end of August, Oracle had about $125 billion of notes payable and other borrowings against about $37 billion of cash and marketable securities.

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Which price is easier to justify?Including debt and cash, the gap flips: the market values Oracle's whole business at about $505 billion, versus around $438 billion for Palantir.

Still, investors are asking much less of Oracle. At today's price, it mostly has to deliver the earnings management already expects, while Palantir has to grow its profit at around 48% a year for five years.

True, Palantir is arguably the better business. It kept 55% of its second-quarter revenue as net income, and it doesn't have Oracle's debt or its spending burden. But at a price-to-earnings ratio around 160, even years of strong results could fall short of what investors are paying for.

Of the two, Oracle's price is the easier one to live up to, and I think this makes it the more reasonable stock of the pair now. But I'd still want to see its spending start producing free cash flow before buying shares.

Palantir just posted growth numbers that humiliated Wall Street estimates, yet the stock still needs to more than double before it touches a trillion-dollar valuation. Here is what the math actually says about whether that gap ever closes.

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Palantir (NASDAQ:PLTR | PLTR Price Prediction) carries a market cap of $440.66B. Reaching $1 trillion would take roughly 2.27x that value, or about $434.65 per share. The 24/7 Wall St. price target of $206.23 over the next 12 months is a more modest step toward that number.

Metric Value Current Price $192.57 Price Target from 24/7 Wall St. $206.23 Upside/Downside 7.09% Recommendation BUY Confidence Level 90% Our model rates Palantir a buy with high confidence. Fundamentals are speeding up faster than the share price, which keeps the upside moderate but real.

A Record 93% Growth Quarter Brought Palantir Shares Back Shares traded at $191.53 Friday afternoon. That is up 8.68% over the past week, 10.88% over the past month and 7.75% year to date, and well above the $133.25 close on June 16. The stock sits about 6% below its 52-week high of $207.52 and 80% above its low of $106.37.

The Q2 earnings report on August 3 showed EPS of $0.41, beating the $0.28 estimate. Revenue rose 92.8% to $1.935B, and U.S. commercial revenue climbed 149%. Management raised full-year revenue guidance to $8.150-8.158B. CEO Alex Karp said “demand for AI sovereignty has now been unleashed.”

Why Bulls See $220 and Beyond The bull case reaches $220.70. Several numbers support it:

Total remaining deal value hit $13.1 billion, up 83%. Net dollar retention reached 157%. Analysts raised their 2027 EPS consensus to $2.3230 from $2.0821 90 days ago. Over the past 30 days there were 26 upward revisions and none down. Karp is aiming “to grow at a rate equal or above to what we have in U.S. commercial for the next 18 months.” Wall Street has 21 Buy ratings, 9 Holds and 2 Sells on the stock.

What Could Pull Palantir Back to $173 The bear case sits at $173.08. The stock trades at 273x trailing earnings. Stock-based compensation totaled $265M in Q2, and the U.S. accounts for over 81% of revenue. International commercial grew only 26%, and government contracts can be terminated for convenience.

Management also noted a “significant ramp in expense” for Q3. That spending pays for hiring and product work, and it comes with a GAAP operating margin already at 47%.

How Palantir Stacks Up Against Snowflake and Datadog Snowflake (NYSE:SNOW) competes directly in data sovereignty, while Datadog (NASDAQ:DDOG) is a benchmark for fast-growing enterprise software.

Company Latest Revenue Growth Market Cap Palantir 92.8% $440.66B Snowflake 35.09% $117.83B Datadog 35.64% $90.93B Snowflake trades at 105x free cash flow and still posts GAAP operating losses. Palantir trades at 211x but makes a GAAP profit.

Datadog raised its outlook to $4.45-4.47 billion in 2026 revenue, about half of Palantir’s guidance. Palantir’s growth is well ahead of both peers, which makes our target look reasonable, if not conservative.

Palantir Price Prediction 2026-2030 The 24/7 Wall St. price target of $206.23 carries a buy rating with 90% confidence. What tips the scale is upward earnings revisions with no cuts.

I’d grow more confident if U.S. commercial growth holds above 100%. I’d grow more conservative if bookings slow while the stock still trades near 94x forward earnings. For now, growth keeps outpacing valuation concerns.

These base-case figures continue the 24/7 Wall St. price target model.

Year Price Target from 24/7 Wall St. 2026 $192.49 2027 $207.57 2028 $225.76 2029 $226.45 2030 $241.37 The projections rest on Palantir continuing its current strategy. Even at the 2030 figure, the stock would be well short of the roughly $434.65 per share a $1 trillion valuation requires.

Growth in sovereign AI demand that runs ahead of forecasts is the catalyst that could close that gap (we reverse-engineered what the biggest tech winners looked like early and put the pattern in a free playbook here).

Contact [email protected] for any questions or corrections.

Palantir is posting revenue growth that most software companies only dream about, while somehow staying GAAP-profitable, but the valuation number sitting above it all raises a question that every serious investor needs to answer before buying.

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Few software stories in the market right now match the sheer velocity of Palantir (NASDAQ:PLTR | PLTR Price Prediction). Revenue is accelerating, margins are expanding, and the company is quickly becoming a default sovereign-AI provider for U.S. commercial and government customers.

Our 24/7 Wall St. price target for Palantir is $311.42, roughly 68.3% above the current price of $192.03. Our recommendation is buy with high confidence at 0.9.

24/7 Wall St. Price Target Summary Metric Value Current Price $192.03 24/7 Wall St. Price Target $311.42 Upside 68.3% Recommendation BUY Confidence Level 90% A Vertical Move Into a New Trading Range PLTR is up 11.28% over the past week and 8.03% year to date, sitting just below the 52-week high of $207.52. Five-year returns of 567.47% speak for themselves.

The Q2 2026 report was the driver. Revenue landed at $1.935 billion, up 92.83% year over year, EPS came in at $0.41 against a $0.28 estimate, and management raised full-year 2026 revenue guidance to $8.150 to $8.158 billion, roughly 82% growth. A separate PwC alliance announced on September 3, 2026 deepens the enterprise distribution story.

Why Bulls See a Breakout Above $340 The bull case starts with a Rule of 40 score of 155%, U.S. commercial TCV bookings of $2.132 billion (up 153%), and net dollar retention of 157%.

CEO Alex Karp told investors he is driving the business to grow at rates “equal or above to what we have in U.S. commercial for the next 18 months.” If AIP continues compounding at that clip, our own bull-scenario one-year path points to $342.06, and the forward-EPS math supports upside toward $358.

Risks Worth Watching Valuation is the obvious pushback. PLTR trades at a P/E of 262 and a P/FCF of 203. Stock-based compensation of $265 million in Q2 pressures shareholders, though bulls fairly note that GAAP operating margin still expanded to 47% despite that expense.

Government contracts are terminable for convenience, and insider activity has been net selling per 55 recent transactions. Our bear-scenario path lands at $246.71, still above today’s price but well below the base case.

How Palantir Compares to Snowflake and CrowdStrike Snowflake (NYSE:SNOW) is the closest data-platform peer, with Q2 FY2027 product revenue growth of 37%, net revenue retention of 126%, and a market cap of $119.95 billion.

Snowflake trades at a P/FCF of 106 while running GAAP operating losses. Palantir grows more than twice as fast and is GAAP-profitable, which makes our target look reasonable.

CrowdStrike (NASDAQ:CRWD) is the AI-security comparison. Q2 FY2027 revenue grew 25.83%, ARR reached $5.84 billion, and net new ARR accelerated 51%. At a market cap of $267 billion, CRWD commands a scarcity premium.

Palantir’s growth is roughly three times faster, which is why our 24/7 Wall St. price target embeds meaningful upside despite the multiple.

A Bullish Setup Palantir is one of the rare software names combining hypergrowth with GAAP profitability. Our 24/7 Wall St. price target of $311.42 is a buy with 90% confidence.

The setup strengthens if U.S. commercial bookings hold above 100% growth next quarter. It weakens if the Rule of 40 rolls back under 120% or if sovereign-AI demand cools.

Palantir is also one of the non-chipmaker names riding the AI infrastructure buildout, a theme we broke down in a free report on seven AI beneficiaries beyond the chipmakers. Right now, the numbers point higher.

Year 24/7 Wall St. Price Target 2026 $216 2027 $311 2028 $447 2029 $557 2030 $676 These projections assume Palantir continues executing on AIP adoption, U.S. commercial expansion, and sustained government demand. Significant upside or downside could come from a shift in sovereign-AI budgets or an unexpected multiple compression across high-growth software.

Contact [email protected] for any questions or corrections.

Frontier-model risk strengthens Palantir's controlled-deployment pitch without removing its own legal exposure. Summary

Palantir’s governance advantage must appear in enforceable customer controls.

Palantir Technologies PLTR, the defense and enterprise AI software company, put AI liability in the spotlight as CEO Alex Karp questioned whether frontier AI developers could bear the cost of major legal claims. Shares rose about 4.1% to $192.455 on Wednesday. Karp suggested that claims against those developers could grow large enough to draw government intervention.

That argument cuts both ways for Palantir. The company's quarterly filing says problems involving generative or agentic AI could bring liability and damage its reputation. It also warns that third-party AI tools integrated into its platforms can produce unreliable results.

Palantir's pitch is that customers need controls around powerful AI before using it in sensitive work. The valuation leaves little room to wave away the risk: at $192.455, the shares stand 6.68% above the $180.41 GF Value shown in the graphic. If Palantir wants credit for helping customers manage AI risk, investors should watch how well its own controls hold up when something goes wrong.

Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.

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The artificial intelligence spending cycle is still in its early stages, according to UBS analysts, who see further opportunities for investors across technology, media and telecommunications as companies move from experimenting with AI to deploying it at scale.

The UBS team has identified 14 “highest-conviction calls” across the TMT sectors, with many of the companies positioned to benefit from continued spending on AI infrastructure, cloud services, chips, networking equipment and enterprise software, MarketWatch reported.

The analysts said the next phase of AI growth is likely to be driven by enterprise adoption, noting that only a small share of companies surveyed have deployed agentic AI at scale.

“The next leg should come from enterprise adoption,” the analysts said in a Thursday note to clients.

Of the companies UBS surveyed on agentic AI deployment, only 8% had implemented the technology at scale.

UBS expects businesses to increase spending on AI infrastructure even as some companies consolidate technology vendors and reduce broader IT budgets.

The analysts also noted that open-source AI models are gaining traction because of their perceived cost advantages.

However, enterprises often deploy those models through major cloud platforms, including Microsoft Azure and Amazon Web Services.

That dynamic could continue to support spending by the largest cloud providers as companies seek computing capacity to run increasingly demanding AI workloads.

Amazon is UBS’s top pick among large-cap internet companies.

The analysts have estimates for AWS revenue above the broader consensus and believe Wall Street “should catch up” as Amazon’s largest customers prepare to deploy its Trainium 2 and Trainium 3 chips from later this year into 2027.

UBS has a $318 price target on Amazon shares, representing about 25% upside from current levels.

Among semiconductor and chip-equipment companies, UBS selected analog chipmaker Texas Instruments as its top pick.

The analysts said the analog semiconductor cycle, which is driven largely by automotive and industrial demand, is beginning to recover.

Texas Instruments has also been gaining market share, providing another potential source of growth.

UBS expects the data-center boom to create additional opportunities for the company as demand for semiconductor components expands alongside AI infrastructure investment.

“Even if growth in data center decelerates slightly next year,” Texas Instruments’ total revenue should still grow by about 20%, according to the analysts.

UBS sees Texas Instruments shares rising 43% to a $380 price target, citing improving industry momentum, market-share gains and the potential for stronger free cash flow.

In telecom and networking equipment, UBS highlighted Celestica as a major beneficiary of the next phase of AI infrastructure investment.

The analysts expect OpenAI’s planned rollout of its first custom chip next year to support revenue growth of at least 70% for Celestica.

The company is already a major provider of Ethernet switching technology to hyperscalers including Google and Meta.

UBS has a $430 price target for Celestica, implying 29% upside.

Data-center investment is also expected to benefit IT distributor TD Synnex.

Its Hyve Solutions business manufactures custom hardware, including servers and networking equipment, for data-center operators and cloud-service providers.

UBS expects spending on data-center infrastructure to increase by at least 30% annually over the next three years.

The analysts have a $352 price target for TD Synnex, implying 32% upside.

Palantir Technologies is another major UBS conviction call, with the analysts describing the company as “at the nexus of the two most powerful spending trends in software - AI and data.”

UBS expects Palantir’s revenue to increase 88%, while its margin is forecast to reach the low-60% range.

The analysts said Palantir has “a very strong demand backdrop for its AI and automation software” and faces limited competition from other AI and software providers.

UBS described the shares as “very attractive” and set a $250 price target, compared with a market price of $177.64.

Beyond Amazon, Texas Instruments, Celestica, TD Synnex and Palantir, UBS’s other top picks include SS&C Technologies, AT&T, EchoStar, Pinterest, Spotify Technology, Mastercard, Global-e Online, Procore Technologies and JFrog.

The breadth of the list reflects UBS’s view that the AI investment cycle is extending beyond chipmakers and model developers.

As enterprises begin deploying AI more widely, the analysts expect spending to spread across cloud infrastructure, networking, data management, software and other technology services.

That could create a second phase of the AI investment cycle in which enterprise adoption becomes increasingly important alongside the massive infrastructure buildout that has driven the sector so far.

Another former government minister has been hired by a controversial US AI company, this time Palantir, which has appointed Andy Burnham’s former ministerial colleague Tom Watson.

The Labour peer and former deputy leader will operate alongside Palantir’s UK and Europe chief executive, Louis Mosley, as the company attempts to fend off pressure on Burnham’s government to axe its £330m NHS contract. It is also fighting Sadiq Khan in court over the Labour London mayor’s block on a £50m contract to use its AI in Metropolitan police investigations. Palantir also wants to win more public sector work in the UK, where it already has an annual turnover of £427m.

The company was co-founded by the Trump-supporting billionaire Peter Thiel and provides AI-powered software to the Israeli military and the White House’s ICE immigration crackdown, leading to a public and political backlash against its deepening involvement in British public services. Alex Karp, its chief executive, said: “This is just the latest chapter of Tom’s forty-year fight for better public services. We are fortunate to have him guide us as we help the British government to deliver for the British public.”

His job will be, in part, to “deepen the social and economic value its work creates through better British public services, jobs and skills”, Palantir said.

Since stepping down from parliament in 2019, Watson has been an adviser to the gambling and music industries and, since 2024, he has been a part-time adviser to Palantir, including accompanying Mosley at Labour party conferences. He was a defence minister and a minister for digital engagement in Gordon Brown’s government. Palantir has a £240m contract with the Ministry of Defence.

The move is just the latest example of a revolving door between British politics and big tech. After the former deputy prime minister Nick Clegg spent nearly seven years earning millions working for Mark Zuckerberg at Meta, the former prime minister Rishi Sunak last year took jobs with Anthropic and Microsoft and the former chancellor George Osborne started working for OpenAI. Keir Starmer’s AI adviser, Matt Clifford, also joined Anthropic this month. He tried to retain the chair of a government science and tech research body, but quit under pressure over conflicts of interest.

“The revolving door is proving very fruitful for big tech,” said Tom Brake, the chief executive of Unlock Democracy, a not-for-profit campaign group. “The only surefire way to stop tech companies benefiting from privileged information acquired by ministers or senior civil servants is to introduce an enforceable five-year ban on taking up industry posts.”

Watson said he was “terrifically excited” by the new role as Palantir’s senior vice-president and highlighted two of the contracts that are in dispute when he said he wanted to help Palantir speed up NHS diagnosis, treatment and discharge from hospitals and enable “our police to crack crimes and root out corruption”. Palantir said Watson had taken a leave of absence from the House of Lords and had relinquished his parliamentary pass while working for Palantir in London.

Palantir Technologies (PLTR +1.09%) CEO Alex Karp just added a third front to the fight over artificial intelligence (AI) safety on Thursday, arguing that the companies developing the technology -- the Anthropics and OpenAI's of the world -- should face civil and criminal penalties if AI causes the damage their CEOs are warning of.

Speaking with CNBC, Karp said that he agreed that "reasonable guidelines" for the industry should be enforced, but that "you can't do it" and that "the first line of defense" instead should be to hold companies and their leaders responsible for their own actions.

Amodei's Sept. 12, 2026, slowdown call splits AI's CEOsKarp was weighing in on an ongoing and high-profile debate within the industry. After Anthropic CEO Dario Amodei penned an essay warning that AI capabilities were improving too quickly for researchers to understand and control them and that action must be taken to ensure the public's safety, he was joined by several AI leaders with calls for a slowdown and increased oversight.

Here's a look at what they had to say:

Anthropic CEO Dario Amodei"...not just investing in risk prevention, but pacing the rate of capabilities advancement so that risk prevention has time to keep up."

"It could outrun our ability to understand and control these systems."

OpenAI CEO Sam Altman"I agree with Dario that we need to pace the frontier."

SpaceX CEO Elon Musk"Dario is right."

Some CEOs pushed backOn the other side of the debate, several executives argued that slowing the pace of development or adding government oversight is either unnecessary or counterproductive.

Here's a look at what they had to say:

Nvidia CEO Jensen Huang"Safety is an engineering problem, not a legal one."

"The market forces are already there. We don't need any new laws. We don't need new regulations."

Meta CEO Mark Zuckerberg"Trust and alignment are quickly becoming the most important capabilities that will differentiate agents and models."

"Any lab that doesn't focus on alignment will fall behind."

Karp offers a 3rd viewIn Karp's view, the threat of real consequences for the builders of AI would give AI companies a much clearer reason to slow down and get safety right than voluntary commitments or new regulations.

In the CNBC interview, he suggested the whole debate is really about shielding the companies from the very liability that would lead to responsible action and that the frontier labs want more than simple oversight: "The view that I believe they have is... these businesses have to be nationalized because if you don't nationalize them, every single one of my clients is going to sue."

Why tighter AI liability rules could benefit PalantirIncreased regulation actually could help Palantir. The company sells software that helps governments and businesses deploy AI inside controlled systems with defined access and oversight. If customers become more concerned about proving how an AI system was used and who authorized its actions, that could make those controls more valuable.

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For Palanitr and the industry as a whole, how this all shakes out could have major implications for investors.

SummaryPalantir Technologies Inc. maintains a strong buy rating, with recent contract wins and partnerships reinforcing the backlog-driven PLTR investment thesis.A $127M U.S. Army TITAN production award signals government confidence and supports multi-year revenue visibility, despite potential margin pressure from increased delivery work.Strategic alliances with Rackspace, PwC, and Nebius address deployment bottlenecks and expand PLTR’s access to new enterprise and AI infrastructure budgets.I expect PLTR's opening 2027 revenue guide to approach $13B, which would materially reduce the stock’s valuation multiple and support further upside. hapabapa/iStock Editorial via Getty Images

Back on August 10, I rated Palantir Technologies Inc. (PLTR) a Strong Buy when it traded at around $172 per share. On September 16, it closed near the same level, within a dollar of where it

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Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Palantir's multiple looks stretched on every traditional measure, yet the earnings math is quietly doing something that could make the valuation argument obsolete before most investors notice it.

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Palantir (NASDAQ:PLTR | PLTR Price Prediction) at $172.56 looks attractive, and the reason has become almost embarrassingly simple. Earnings are compounding faster than the multiple can stay stretched, yet the stock has quietly gone nowhere this year.

Palantir sells enterprise AI software through Gotham, Foundry, and AIP, converting pilots into multi-year, eight and nine figure contracts, especially inside U.S. commercial accounts. Shares hit a 52-week high of $207.52 earlier in the year before settling into a range with a 50-day moving average of $154.81, giving investors a rare pause in a chart that has otherwise gone straight up.

Growth Faster Than the Multiple Can Stay Stretched Q2 2026 reset the narrative. Revenue grew 92.8% year-over-year to $1.935 billion, U.S. commercial jumped 149%, and the Rule of 40 score hit 155. GAAP net income reached $1.06 billion, up 225% YoY, on a 63% adjusted free cash flow margin.

Management raised FY2026 revenue guidance to $8.15 to $8.158 billion (82% YoY growth) and adjusted free cash flow guidance to $4.5 to $4.7 billion. Analyst estimates are chasing: FY2027 EPS consensus climbed from $2.07 ninety days ago to $2.33, with 26 upward revisions and zero cuts in the past 30 days.

A Valuation That Leaves No Room for Error PLTR trades at roughly 148x trailing earnings, 75x forward earnings, and 68x sales. Even for a hyper-grower, extreme numbers.

The business also leans on one geography and one theme. Over 81% of revenue is U.S., while international commercial grew just 26% YoY. Stock-based comp ran $265 million in Q2, government contracts remain terminable for convenience, and a beta of 1.62 means any AI narrative reversal hits harder than the market. YTD price action is the tell: down while the S&P 500 is solidly up.

Waiting for the Q3 Earnings Report Patience has a case. The 200-day moving average of $151.58 sits well below current levels, and buying after a 1,716% ten-year run demands conviction. The next test is Q3 2026 earnings, where consensus calls for $0.41 EPS on $2.18 billion in revenue. Any deceleration in U.S. commercial growth would spook the multiple, and waiting through that report avoids committing capital ahead of the update.

What the Numbers Actually Say PLTR currently trades at $172.56 against a consensus target of $195.73, implying roughly 13% upside from 32 covering analysts. The ratings breakdown tilts bullish:

Strong Buy: 1 Buy: 20 Hold: 9 Sell: 1 Strong Sell: 1 Valuation is stretched on every traditional measure, though margins soften the blow: 49% net margin and 47% operating margin TTM. Year to date, PLTR is down 2.92% while the S&P 500 is up 11.07%. Over one year, PLTR is up 0.79% versus 14.6% for the index. Analyst targets are one data point, not a promise.

Growth Is Doing the Compression Work At $172.56, Palantir screens attractively. Here is why the setup matters.

FY2026 consensus EPS of $1.61 climbs to $2.33 in FY2027, with management guiding for U.S. commercial revenue above $3.424 billion (134% growth). If commercial keeps compounding anywhere near its current pace, the forward multiple compresses on its own without any price decline.

The path to appreciation runs through two catalysts. First, Q3 2026 earnings, where any beat extends a nine consecutive quarter beat streak. Second, a break above $207.52 would confirm the range breakout the YTD chop has been building.

What invalidates the thesis: a single quarter of U.S. commercial growth dropping below 100%, or a material government contract termination. Watch net dollar retention of 157% and RPO of $4.9 billion each quarter.

Palantir at 148x earnings sounds insane until you notice EPS just grew from $0.16 a year ago to $0.41 and management just delivered its largest-ever full-year revenue guidance raise. At this price, investors are paying up for one of the fastest-growing profitable software businesses in the market, and the growth trajectory is what supports the premium.

Contact [email protected] for any questions or corrections.

Key Takeaways Palantir's consolidation comes as AI demand, commercial adoption and government ties stay strong.PLTR posted $3.4B in Q2 bookings, 157% net dollar retention and $13.1B in remaining deal value.Palantir's Q2 adjusted operating margin topped 60%, while free cash flow exceeded $1.2 billion.
Palantir Technologies’ (PLTR - Free Report) negligible share-price decline over the past year appears more like a period of consolidation than a deterioration in its investment case. The company continues to benefit from robust demand for its artificial intelligence platforms, expanding commercial adoption and strong government relationships. Its solid growth trajectory and improving operating leverage further support long-term optimism. Against this backdrop, this article examines whether Palantir’s recent price stability, underlying business momentum and AI-driven growth prospects present a buying opportunity for investors.

                                                         Image Source: Zacks Investment Research

Commercial AI Momentum Should Sustain PLTR’s GrowthPalantir’s commercial business is emerging as its powerful future growth driver as enterprises accelerate artificial intelligence adoption. Commercial revenues are approaching half of total sales, supported by customers moving beyond pilot programs toward mission-critical deployments. The company’s Artificial Intelligence Platform is helping organizations connect models with proprietary data, workflows and operational decisions, strengthening its value across business functions. Larger contract sizes indicate deeper engagement and rising spending among existing clients. That suggests Palantir is building durable relationships rather than relying on customer acquisition. With U.S. operations generating more than four-fifths of revenues, exceptionally strong domestic demand should continue supporting scale, recurring expansion and a widening competitive position in enterprise AI software.

Exceptional Profitability Strengthens PLTR’s Bullish CasePalantir’s exceptional margins and cash generation strengthen the bullish case by showing that rapid growth is translating into high-quality earnings. An adjusted gross margin in the mid-80% range in the second quarter of 2026 underscores the scalability of its software model, while an adjusted operating margin above 60% demonstrates significant operating leverage. Free cash flow also exceeded $1.2 billion in the quarter, highlighting the company’s ability to convert rising demand into substantial liquidity. Its $9.2 billion cash and short-term Treasury position provides flexibility to invest in product development, expand delivery capacity and pursue strategic opportunities without pressuring the balance sheet. Although cloud-hosting responsibilities created modest gross-margin pressure, faster implementation and deeper customer relationships could outweigh that near-term effect. Overall, PLTR’s profitability profile supports sustained, self-funded expansion.

Record Bookings Point to Durable Growth AheadPalantir’s record bookings and expanding backlog indicate that its growth momentum has room to run. Total contract value bookings reached $3.4 billion in the second quarter, while net dollar retention climbed to 157%, signaling sharp spending increases among existing customers. Remaining deal value of $13.1 billion and performance obligations of $4.9 billion provide visibility into future sales. Management’s sizeable full-year guidance increase adds confidence, with the revenue outlook lifted by roughly $500 million at the midpoint and expectations for U.S. commercial revenues raised again. Higher projections for adjusted operating income and free cash flow also show that expansion is not coming at the expense of profitability. Together, stronger commitments, accelerating customer usage and repeated outlook upgrades support a favorable view of PLTR’s growth durability.

PLTR’s Rising Capital Efficiency Strengthens the Bull CasePalantir’s capital efficiency has strengthened significantly. Return on invested capital rose from roughly 15% in September 2025 to 29.7% in June 2026, comfortably exceeding the Internet Software industry’s 18.3%. Return on equity also climbed from about 28% to 37.8%, surpassing the industry’s declining 28.7%.

These widening advantages indicate that Palantir is generating stronger profits from both invested capital and shareholder equity as its artificial intelligence platforms scale across government and commercial markets. Continued revenue growth, margin expansion and disciplined spending could further improve these metrics.

Analyst Sentiment Remains Highly FavorableConsensus estimates continue to support Palantir’s growth trajectory. Earnings are projected to increase 113.3% in 2026 and 41% in 2027, while revenue growth expectations remain robust at 81.8% in 2026 and 42.5% in 2027.

Analyst sentiment has also improved considerably. Over the past 60 days, analysts issued 11 upward earnings estimate revisions for 2026 against no downward revisions. Forecasts for 2027 also moved higher, with 10 upward revisions and none downward, reflecting growing confidence in Palantir’s execution capabilities and expanding AI opportunity.

                                                                      Image Source: Zacks Investment Research

Two Enterprise-AI Peers Worth WatchingSnowflake (SNOW - Free Report) and C3.ai (AI - Free Report) are two notable peers operating across the expanding enterprise-AI market. Snowflake helps organizations consolidate, manage and analyze data while developing AI applications through its cloud-based platform. Snowflake therefore competes for corporate spending on data infrastructure and AI-driven workloads.

C3.ai offers enterprise AI applications and development tools across industries such as energy, manufacturing and defense. C3.ai also targets organizations seeking to deploy AI at scale. Compared with Snowflake and C3.ai, Palantir stands out through its combination of commercial and government exposure, operational software platforms, strong customer expansion and exceptionally high margins.

PLTR’s Strong Fundamentals Support a Strong BuyPalantir’s year-long consolidation offers an attractive entry point for investors seeking exposure to enterprise artificial intelligence. Its accelerating commercial adoption, entrenched government relationships and expanding contract pipeline provide a solid foundation for durable growth. Exceptional margins, robust cash generation and improving capital efficiency demonstrate that rapid expansion is translating into stronger financial performance. Meanwhile, favorable earnings revisions underscore growing confidence in management’s execution and the company’s long-term opportunity. With business momentum remaining firmly positive, PLTR appears well positioned to outperform and currently represents a Strong Buy.

PLTR stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Customer deployments are accelerating, but Palantir's $426 billion valuation already anticipates exceptional execution. Summary

Palantir’s operating momentum remains powerful; its valuation leaves almost no room for ordinary growth.

Palantir Technologies PLTR, the artificial-intelligence and data-platform company, reversed an early 0.6% gain and traded at $166.68 Friday. Rosenblatt reiterated its Buy rating and $225 price target after Palantir's 11th customer forum, pointing to roughly 35% upside from the price shown. The picture also places Palantir 5.72% below its GF Value™ estimate of $176.79, suggesting modest near-term upside despite the stock's demanding valuation.

The event delivered the evidence investors wanted: Palantir's AI software is moving beyond demonstrations and into real operations. Customers highlighted deployments across industrial supply chains and U.S. Army targeting systems. That adoption follows second-quarter revenue growth of 93% to $1.94 billion, while management expects approximately $8.15 billion in full-year revenue and at least 134% growth from its U.S. commercial business.

The catch is the price investors must pay for that momentum. Palantir's roughly $426 billion market capitalization represents more than 52 times the midpoint of management's annual revenue outlook. Explosive growth can defend an extraordinary multiple—but only if these production deployments keep multiplying. The customer forum strengthened the bull case, yet Palantir still has almost no room for execution errors.

Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.

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The partnership expands Palantir's commercial reach, but the valuation demands financially visible contracts. Summary

Supply-chain AI must become revenue quickly enough to defend Palantir’s exceptional multiple.

Palantir Technologies PLTR, the enterprise and government AI-software provider, deepened its Nvidia NVDA partnership Thursday to develop AI-powered supply-chain systems. Shares slipped approximately 0.8% to $168.24, even as the collaboration stretches across agriculture, manufacturing, pharmaceuticals, retail, technology and government.

The partnership pairs Nvidia's Nemotron models with Palantir's data and software platforms, while Nvidia plans to deploy the technology inside its own operations. The expansion lands as Palantir's growth accelerates: second-quarter revenue surged 93% to $1.94 billion, including $764 million from its fast-growing U.S. commercial business.

Yet the valuation leaves little room for ordinary execution. Annualizing the latest quarter produces roughly $7.76 billion in revenue, putting Palantir's $430.6 billion market value near 55 times that run rate. The picture shows the $168.24 share price sitting 4.69% below the $176.51 GF Value™, suggesting modest upside—but the partnership still needs meaningful deployments and paying customers to justify the premium.

Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.

Click for the complete disclosure

Nvidia and Palantir Technologies announced a new AI collaboration on Wednesday, which they call “sovereign AI” for critical supply chains.

The system will first run inside Nvidia’s own manufacturing and logistics network, which other industries will follow later.

The system combines Nvidia’s Nemotron open models with Palantir’s Foundry and AIP platforms, and it is grounded in Palantir’s Ontology system.

The goal is real-time visibility into supply chain constraints, which will also help codify operational knowledge and speed up decisions.

Companies keep control of their own data, and they don’t need to route it through a shared commercial model.

Nvidia runs one of the most complex supply chains in the industry, spanning millions of parts, thousands of suppliers, and a global network of manufacturing partners.

Each Nvidia Vera Rubin server rack alone needs 1.3 million parts.

The new AI system should help Nvidia’s teams spot material shortages earlier.

It should also help them weigh alternatives faster, and it should guide allocation decisions based on their full impact on production.

“Nvidia has arguably the most valuable, intricate, and complex supply chain in the world,” said Alex Karp, Palantir’s co-founder and CEO, in the companies’ joint statement.

Nvidia founder and CEO Jensen Huang called supply chains “the operating system of the physical economy.”

He said the companies are turning that network into what he called sovereign intelligence.

Other companies can also use the system, including firms in agriculture, manufacturing, pharmaceuticals, retail, technology and government.

They can post-train Nemotron models with their own data inside Palantir’s Foundry and AIP, and Nvidia’s cuOpt software adds scenario planning on top.

It lets teams model supply constraints and weigh tradeoffs, and the AI recommends actions and flags risks, but final decisions stay with human experts.

The deployment runs on a jointly built reference architecture called the Palantir Sovereign AI Operating System.

Dell Technologies and Cisco support on-premises deployments, and Rackspace and Nebius support cloud and co-location options.

This is the latest step in a relationship the two companies have been building for close to a year.

Nvidia and Palantir first showed a joint AI framework at Nvidia’s GTC conference in October 2025, followed by the “Chain Reaction” domestic AI infrastructure initiative in December, and a sovereign AI partnership for US government and critical infrastructure customers announced in June.

The tie-up also gives both companies a high-profile reference case: Nvidia gets to show its own supply chain running on the system before pitching it to outside customers, while Palantir gains another marquee use case tied to the world’s most closely watched AI hardware maker.

Details of the collaboration will be presented in full at Palantir’s AIPCon 11 conference.

Palantir just handed Nebius a coveted sovereign AI label, but traders are punishing one side of the partnership and rewarding the other in ways that reveal exactly where the market thinks the real leverage sits.

Sovereign AI infrastructure is driving today’s action across the AI cloud complex. Palantir Technologies (NASDAQ:PLTR | PLTR Price Prediction) named Nebius Group (NASDAQ:NBIS) its preferred sovereign AI infrastructure partner this morning, and the compute provider is outperforming the software vendor.

Nebius stock is up 6% to $239.23 in Tuesday morning trading, extending what has already been a monster advance for the year. Meanwhile, Palantir stock is down 1% to $172.39 in early action, giving back some of last month’s ground.

The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is down 0.46%, so today’s announcement is landing on a slightly lower broad tape. That leaves the divergence between Nebius and Palantir looking like a stock-specific reaction on an otherwise quiet session.

Sovereign AI Partnership Fuels Nebius Rally Palantir has named Nebius its preferred sovereign AI infrastructure partner, integrating Nebius cloud and compute capabilities inside Palantir’s enterprise perimeter. The pact plugs a scaled GPU cloud directly into Palantir’s AIP software stack for customers that want to keep their data, models, and weights under their own control. That positioning matches how Palantir has been marketing sovereignty on recent earnings calls, where the company has argued that generic token-based AI services quietly transfer enterprise IP to third parties.

CEO Alex Karp framed the demand backdrop on Palantir’s Q2 2026 earnings call, stating, “Demand for AI sovereignty has now been unleashed. And Palantir is the only company that has demonstrated it can transform tokens into actual economic value…The sovereign AI revolution makes us very optimistic about the future.” Karp also flagged on the same call that Palantir was actively hunting for technically capable partners to help scale that push, and today’s announcement gives that pitch a named infrastructure counterparty behind it.

Credential Versus Contract for Nebius The market is treating today’s news as demand validation for Nebius. Palantir picks up an incremental distribution channel from the deal, and today’s split reaction shows the market sees more near-term upside on the infrastructure side of the pairing. Nebius stock has run hard this year while Palantir stock has traded lower, so the announcement reads as a fresh reason to own compute exposure and as a smaller catalyst for the enterprise software name.

Nebius reported Q2 2026 revenue of $582.3 million, up 454% year over year (YoY), with its AI Cloud segment growing 514% YoY. Its remaining performance obligations reached $37.49 billion, and management reaffirmed FY26 revenue guidance of $3 billion to $3.4 billion.

However, the preferred-partner designation carries no disclosed committed capacity or dollar figure, so its value to Nebius is more credential than contract. Nebius already carries heavy customer concentration, with three customers representing 24%, 21%, and 14% of Q2 2026 revenue, so additional named logos in the pipeline can help dilute that risk over time.

CoreWeave (NASDAQ:CRWV) is the closest listed comparable to Nebius on GPU cloud capacity, with no direct involvement in this Palantir partnership. Its own Q2 2026 report showed revenue of $2.575 billion, up 112.3% YoY, and a revenue backlog near $104 billion, so the peer set is scaling in its own right.

Session Scorecard Ticker Session Move Year to Date NBIS +6% +183% PLTR -1% -2% CRWV +7% +35% Nebius stock has run 183% year to date (YTD), so today’s move extends an already large uptrend. Palantir stock is down 2% YTD, which reframes today’s fade as another leg in a sideways-to-lower year even as the underlying business keeps compounding revenue.

CoreWeave stock is up 35% YTD, and the company was recently added to the NASDAQ 100. That backdrop shows the AI cloud pure-play trade has been rewarded broadly ahead of today’s Palantir-Nebius headline (we profiled seven non-chipmaker names powering the same data-center buildout in a free report on AI infrastructure winners).

What to Watch Next The bull case for Nebius rests on the guided revenue ramp and a contracted power target of more than 4 GW by year-end 2026, which would support the ARR outlook management has already put on the board. The bear case is that a credential without contracted dollars can fade quickly if CoreWeave or another peer signs a larger, disclosed sovereign AI deal in the same window.

Traders can watch for follow-through in Nebius shares and any additional color from either company on whether the preferred-partner tag converts into disclosed capacity or revenue. Investors sizing their exposure should keep their positions modest given customer concentration and a price-to-sales multiple that already prices in aggressive growth.

Palantir’s story is intact on the reported numbers, with FY26 revenue guidance raised to $8.15 billion to $8.16 billion, a Rule of 40 score of 155, and a P/E ratio near 247x. Shareholders can check for firmer support and a clearer read on how sovereign AI partnerships translate into billings before adding to their positions on today’s dip.

Contact [email protected] for any questions or corrections.

DMC Group LLC lessened its holdings in shares of Palantir Technologies Inc. (NASDAQ:PLTR – Free Report) by 47.0% in the second quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission. The fund owned 4,556 shares of the company’s stock after selling 4,042 shares during the quarter. DMC Group LLC’s holdings in Palantir Technologies were worth $532,000 at the end of the most recent quarter.

Several other hedge funds and other institutional investors also recently modified their holdings of the business. BlackRock Inc. raised its stake in Palantir Technologies by 0.4% in the second quarter. BlackRock Inc. now owns 189,817,693 shares of the company’s stock valued at $22,146,030,000 after purchasing an additional 757,322 shares in the last quarter. State Street Corp grew its stake in Palantir Technologies by 1.1% in the 4th quarter. State Street Corp now owns 102,385,317 shares of the company’s stock worth $18,198,990,000 after buying an additional 1,126,418 shares in the last quarter. Geode Capital Management LLC grew its stake in Palantir Technologies by 1.5% in the 4th quarter. Geode Capital Management LLC now owns 54,200,265 shares of the company’s stock worth $9,599,882,000 after buying an additional 805,047 shares in the last quarter. Norges Bank bought a new position in shares of Palantir Technologies in the 4th quarter worth $5,149,641,000. Finally, Invesco Ltd. increased its holdings in shares of Palantir Technologies by 2.8% in the 4th quarter. Invesco Ltd. now owns 22,415,082 shares of the company’s stock worth $3,984,281,000 after buying an additional 616,297 shares during the last quarter. Hedge funds and other institutional investors own 45.65% of the company’s stock.

Palantir Technologies Stock Performance PLTR stock opened at $174.33 on Monday. The company has a market capitalization of $418.93 billion, a PE ratio of 149.00, a price-to-earnings-growth ratio of 2.47 and a beta of 1.62. Palantir Technologies Inc. has a one year low of $106.37 and a one year high of $207.52. The company’s 50 day moving average price is $150.22 and its two-hundred day moving average price is $143.63.

Palantir Technologies (NASDAQ:PLTR – Get Free Report) last announced its quarterly earnings data on Monday, August 3rd. The company reported $0.41 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.34 by $0.07. Palantir Technologies had a net margin of 49.01% and a return on equity of 30.57%. The company had revenue of $1.94 billion during the quarter, compared to analysts’ expectations of $1.81 billion. During the same quarter in the prior year, the company earned $0.16 EPS. The firm’s revenue was up 92.8% on a year-over-year basis. On average, research analysts predict that Palantir Technologies Inc. will post 1.27 EPS for the current year. Insider Buying and Selling at Palantir Technologies In other news, insider Shyam Sankar sold 35,000 shares of the firm’s stock in a transaction dated Thursday, August 6th. The stock was sold at an average price of $155.70, for a total transaction of $5,449,500.00. Following the transaction, the insider directly owned 642,786 shares of the company’s stock, valued at approximately $100,081,780.20. This trade represents a 5.16% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Jeffrey Buckley sold 1,250 shares of Palantir Technologies stock in a transaction dated Friday, August 21st. The stock was sold at an average price of $174.29, for a total value of $217,862.50. Following the completion of the transaction, the insider owned 56,921 shares in the company, valued at approximately $9,920,761.09. This represents a 2.15% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last three months, insiders sold 721,508 shares of company stock valued at $117,070,093. Company insiders own 9.53% of the company’s stock.

Key Stories Impacting Palantir Technologies Here are the key news stories impacting Palantir Technologies this week:

Positive Sentiment: Expanded PwC alliance strengthens Palantir’s enterprise AI reach. Palantir and PwC expanded their strategic partnership to help organizations scale AI, transform mergers and acquisitions, and modernize ERP systems. PwC’s consulting network could help Palantir secure more corporate customers and larger deployments. PwC and Palantir Expand Strategic Alliance Positive Sentiment: Army contract adds support for the government business. Palantir won a prime agreement to deliver eight TITAN tactical intelligence ground-station systems to the U.S. Army, reportedly valued at about $192 million. The award expands Palantir’s role in defense intelligence and reinforces demand for its software and data platforms. What Does Palantir Winning Army Work Mean for AI Growth? Positive Sentiment: Technical momentum remains constructive. Palantir recently moved above its 20-day moving average and flashed a “golden cross” signal, which technical investors may interpret as evidence of continued short-term strength. The company’s latest reported quarter also featured 92.8% year-over-year revenue growth and earnings above analyst expectations. Neutral Sentiment: Investor commentary remains broadly bullish but speculative. Articles highlight Palantir as a potential AI software and cybersecurity winner, while management continues to promote secure, customized AI deployments. These views may support sentiment but do not represent new financial guidance. Negative Sentiment: Premium valuation leaves little room for disappointment. Palantir’s market capitalization is above $400 billion and its price-to-earnings ratio is around 149, making the stock vulnerable to profit-taking or any slowdown in growth and margins. Analysts note that its rapid expansion is already reflected in the share price. Is Palantir’s AI Growth Worth the Premium Valuation? Negative Sentiment: Competitive and insider-selling concerns persist. Google’s expanding government AI offerings could pressure Palantir’s public-sector opportunity. Michael Burry also renewed his bearish criticism of Palantir’s valuation and business model. Separately, a director sold $244,915 of stock under a pre-arranged Rule 10b5-1 plan, a modest negative sentiment signal. What’s Bugging Palantir’s Stock? Analyst Upgrades and Downgrades Several analysts have recently weighed in on the stock. Wolfe Research assumed coverage on shares of Palantir Technologies in a research report on Tuesday, August 4th. They set a “buy” rating on the stock. BNP Paribas Exane assumed coverage on shares of Palantir Technologies in a research report on Tuesday, June 16th. They issued an “underperform” rating for the company. Cantor Fitzgerald started coverage on Palantir Technologies in a research note on Tuesday, August 4th. They issued an “overweight” rating on the stock. President Capital upgraded Palantir Technologies from a “neutral” rating to a “buy” rating and raised their price target for the company from $25.50 to $133.00 in a research report on Monday, June 29th. Finally, Royal Bank Of Canada reaffirmed an “underperform” rating and set a $90.00 price target on shares of Palantir Technologies in a research note on Friday, July 31st. Two research analysts have rated the stock with a Strong Buy rating, twenty-one have given a Buy rating, ten have given a Hold rating and three have given a Sell rating to the company. According to MarketBeat, the company presently has a consensus rating of “Moderate Buy” and an average price target of $192.19.

Get Our Latest Analysis on PLTR

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Palantir Technologies is a software company that develops data integration, analytics and operational decision-making platforms for government and commercial customers. Founded in 2003 by a team that included Alex Karp and Peter Thiel, Palantir has grown into a provider of enterprise-scale software designed to help organizations integrate disparate data sources, build analytic models and drive operational workflows. The company went public in 2020 and continues to position its products around large, complex data projects where security, provenance and real-time collaboration are important.

Palantir’s product portfolio centers on a small number of core platforms.

See Also Five stocks we like better than Palantir Technologies AI Token Costs Are Changing the Hardware vs. Software Debate 3 ETFs That Could Move as Rate Expectations Shift 3 Stocks With September Catalysts Investors Shouldn’t Ignore Ollie’s Bargain Outlet Stock Falls on Weak Comps Despite Margin Gains Want to see what other hedge funds are holding PLTR? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Palantir Technologies Inc. (NASDAQ:PLTR – Free Report).

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Palantir Technologies (PLTR -4.49%) has made a parabolic move on the stock market lately, with shares of the company jumping 39% since Aug. 3, the day when it released its Q2 earnings report.

This incredible jump in Palantir stock has been fueled by the company's stronger-than-expected Q2 numbers and an improved full-year guidance. The good news for investors is that the recent rally in this artificial intelligence (AI) software specialist is poised to continue over the coming year.

Let's see why that's likely to be the case.

Image source: The Motley Fool.

Palantir's accelerating growth trajectory is sustainable Palantir's Q2 revenue surged 93% year over year to $1.94 billion, well above the 48% revenue growth it reported in the same quarter last year. What's more, Palantir's non-GAAP earnings per share (EPS) jumped at a stronger pace of 156% year over year to $0.41.

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The company's terrific results can be attributed to the strong demand for its Artificial Intelligence Platform (AIP), which enables customers to integrate generative AI models with their proprietary data. Palantir notes that its total contract value (TCV) surged 49% year over year in Q2 to $3.37 billion, significantly exceeding the company's top line.

The surge in Palantir's TCV strengthened its revenue pipeline. This is evident from the company's remaining deal value (RDV) of $13.1 billion, an 83% jump from the year-ago period. RDV is the total value of contracts that Palantir is yet to fulfill at the end of a quarter. The size of this metric clearly tells us that Palantir's improving growth trajectory is sustainable.

Palantir's robust revenue pipeline is why it has raised its full-year guidance. The company expects full-year revenue of just over $8.15 billion, implying an 82% increase over last year. It is worth noting that Palantir was originally expecting 2026 revenue of almost $7.19 billion when the year began.

I won't be surprised to see Palantir boosting its guidance in the future as well. That's because the company added 200 new customers in Q2 compared to the year-ago period. The new customers Palantir wins tend to expand adoption of its AI software offerings. This is evident from the company's net dollar retention rate, which compares the trailing twelve-month revenue from customers at the end of a quarter to the trailing twelve-month revenue from the same customers in the year-ago quarter.

Palantir's net dollar retention was 157% in Q2, up seven percentage points from the year-ago period. The stronger spending by existing customers, along with the addition of new customers, should pave the way for a bigger jump in Palantir's earnings over the coming year, paving the way for more upside in this AI stock.

Palantir's 12-month median price target of $205 suggests potential upside of 17%. However, it can clock bigger gains given its ability to outperform expectations.

Analysts are expecting Palantir's earnings to increase by 114% in 2026 to $1.61 per share, followed by a smaller 44% jump in 2027. However, analysts have been increasing their EPS estimates.

Data by YCharts

Also, Palantir's healthy revenue pipeline and potentially stronger spending by existing customers should ensure that it grows at a significantly faster pace than the 44% growth analysts are projecting in 2027. Assuming Palantir doubles its earnings once again in 2027 and crushes Wall Street expectations, the stock could approach the Street-high price target of $255, implying a 46% gain in a year.

However, the company's improving growth rate could boost investor confidence in the stock, helping Palantir make a bigger move and surge past the Street-high price target.

Palantir Gains on Expanded PwC Deal: AI Push Gets Another Major Boost Summary

Palantir expands its PwC relationship as both sides target AI deployments across major corporate operations

Palantir Technologies PLTR is gaining after expanding its work with PwC US, giving the software company another channel to bring its artificial intelligence tools into large corporate projects.

The collaboration will cover areas including mergers and acquisitions, enterprise AI deployments and complex business planning. The expanded relationship could help broaden Palantir's exposure to commercial customers as companies increase spending on data and automation.

The company still faces risks tied to its customer mix and the timing of large contracts. Shifts in government spending or delays in major renewals could make quarterly results less predictable.

The PwC expansion may strengthen Palantir's commercial AI opportunity, but investors will likely watch whether new partnerships translate into recurring revenue.

Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.

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Michael Burry is once again targeting Palantir Technologies (NASDAQ:PLTR), and this round is all about the accounting.

PLTR stock is moving. See the real-time price action here.  In a new post titled “Palantir: An Accounting,” published on X and his Substack, Burry disclosed he remains short Palantir stock and holds put options against it. 

“Palantir is back in the stratosphere,” he wrote. “The facts have not changed. Yes, FOMO is pushing companies to hire Palantir for now, but its competitive position gets more dire almost by the day.”

Receivables Under the MicroscopeThe centerpiece of his latest argument is accounts receivable. Burry says AR has grown faster than revenue in nine of the last 12 quarters, a pattern he links to “nefarious tricks such as channel stuffing, aggressive revenue recognition, or extended payment terms used as sales concessions.” 

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Burry zeroes in on a single “Customer A” — which he believes is a large government client — whose share of Palantir’s AR climbed from under 10% before the IPO to 26% in 2024 and 25% in the most recent 10-K, all while never accounting for more than 10% of revenue.

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He also points to days sales outstanding (DSO), noting the average “has almost doubled from 35 days in 2020 to 66 days in 2025.” 

His conclusion: “Any way I slice it, Palantir is losing either bargaining power or it is channel stuffing, or both. The former is a weak business position, and the latter a crime.”

‘The Stock Price Is the Business Model’Burry didn’t stop at receivables. He compared Palantir’s deferred-revenue pattern to consultancies like Accenture (NYSE:ACN) rather than true SaaS peers such as Salesforce (NYSE:CRM) or ServiceNow (NYSE:NOW), arguing this undercuts bulls who justify Palantir’s valuation using software multiples. 

He also cited a Financial Times report on CEO Alex Karp‘s private jet expenses, which hit $17.2 million in 2025, and noted Palantir paid zero federal tax that year despite $1.6 billion in pre-tax income.

Summing up his view of the business model, Burry wrote: “With $PLTR, in so many ways, the stock price is the business model.”

PLTR Stock Price Activity: Palantir stock traded higher Thursday, undisturbed by Burry’s latest swipe. Shares were up 6.90% at $181.14 at the time of publication Thursday, according to Benzinga Pro.

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Palantir Technologies PLTR stock fell on Wednesday as investors took profits following a sharp rally in August, while institutional selling added pressure to the shares.

The stock had gained roughly 48% during the month following a strong second-quarter earnings report.

Palantir shares climbed from $125.65 on Aug. 3, the day of its second-quarter earnings release, to $186.31 by Aug. 31.

The stock subsequently pulled back, falling 6.6% on Wednesday to $168.04. The decline came just two sessions after Palantir reached a 2026 closing high of $186.38.

The company had reported second-quarter revenue growth of 93% year over year, while US commercial revenue nearly doubled.

The strong results helped drive the stock's August advance, but the sharp gains have also left investors focused on the company's valuation.

Alongside the stock decline, Palantir announced Wednesday that Peter Zaffino, former CEO and Executive Chairman of AIG, will join the company as Global Head of Financial Services effective Jan. 15, 2027.

Palantir co-founder and CEO Alex Karp highlighted Zaffino's experience working within large enterprises. "Peter has spent his career challenging inertia and rejecting incrementalism within large enterprises," Karp said.

The appointment adds a senior executive with experience in financial services to Palantir's leadership team as the company continues to expand its presence across industries.

The latest pullback also comes shortly after Palantir secured a new US Army contract.

The Army Contracting Command awarded Palantir USG a prime agreement for eight TITAN ground stations. The contract is valued at $127 million, according to Defense Scoop.

The award moves the TITAN program from the prototype stage into production. Palantir's partners on the project include Anduril Industries and L3Harris Technologies.

Futurum Equities strategist Shay Boloor said the agreement "pushes Palantir further into owning the full battlefield system," highlighting the broader role the company is seeking in defense technology.

The contract represents another expansion of Palantir's defense business, although the announcement did not prevent the stock from declining as investors locked in gains from the August rally.

Institutional selling has also contributed to the recent pressure on Palantir shares.

ARK Invest sold approximately 139,456 Palantir shares worth around $26 million on Aug. 31.

The sales were part of a broader pattern of Palantir position reductions by ARK throughout August.

The investment firm has been trimming its position following rallies in the stock and redirecting capital toward Block and Rocket Lab.

The selling comes after Palantir's strong second-quarter performance and the resulting surge in its share price.

The stock's roughly 48% August gain has increased attention on its valuation and whether the advance has moved ahead of near-term fundamentals.

Despite the latest decline, Palantir continues to receive support from its expanding defense business, including the TITAN production agreement, while its new financial services leadership appointment adds another area of focus for the company.

Palantir Technologies (NASDAQ: PLTR) chief executive officer Alex Karp has never been shy behind a microphone. However, it seems that investors have been hearing more from Karp since the company's Q2 2026 earnings report.

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Much of Karp's discussion centers on sovereign AI, which involves developing and managing AI systems with a degree of independence in data, technology, operations, and legal aspects.

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This is more than making a policy decision. For governments and enterprise customers to achieve sovereign AI, they will need to reshape their existing ecosystems to connect various layers (e.g., energy, compute, data, models, and applications) into a single, coherent system.

In 2026, the demand for sovereign AI has a total addressable market (TAM) between $100 billion and $160 billion. However, McKinsey, a global consulting firm that advises governments and major companies, forecasts that TAM will grow at a compound annual growth rate (CAGR) of around 35% and will total approximately $600 billion by 2030.

That's the growth curve Karp is positioning Palantir to ride, and increasingly, he's framing it as a fork in the road that other AI vendors, including Microsoft NASDAQ: MSFT, may have to address more directly.

Palantir and Microsoft Are Betting on Different AI FuturesThat's not showing up clearly in the respective stock prices in the last month. Wall Street keeps pricing PLTR and MSFT as if they're the same trade. On Aug. 12, both stocks fell while chip and networking names rallied, lumped into one "AI software" basket.

That's a perception problem. The fundamentals underneath these two companies are starting to pull in opposite directions, and sovereign AI is driving the split.

Karp isn't being subtle about it. On the company's quarterly conference call, he escalated an argument he'd already been making for months: enterprises that rent their AI stack from a third-party risk handing over the "alpha" that makes them competitive in the first place. In Karp’s framing, Palantir offers a different path: keeping more control over data, models, and compute rather than leasing the full AI stack from outside providers.

The significance of that statement is that it's a direct rebuttal to Microsoft CEO Satya Nadella's own comments about AI's "second payment," the idea that value captured by AI vendors eventually gets extracted from their enterprise customers.

Karp isn't picking a fight with Microsoft CEO Satya Nadella here so much as turning Nadella’s warning into a Palantir sales argument. Nadella published his own essay in July, "The Reverse Information Paradox," warning that companies "pay twice" for AI: once in money, once in the proprietary know-how they hand over to make the model useful. Karp took that admission and pushed it further, arguing on the call that this "second payment" could eventually help train a competitor.

This isn't a new Karp talking point. It's become the bedrock of Palantir's pitch to the market. In July, Palantir published a nine-point "AI sovereignty" manifesto and followed it with a white paper, "Institutional Sovereignty in the Age of AI." The message hasn't changed: renting frontier intelligence can become a tax on your business, not always a shortcut to competitiveness.

Where Microsoft Fits in the Sovereign AI DebateMicrosoft's AI business is built heavily on the model Karp is attacking. Azure sells compute. Copilot sells seats. OpenAI's models sell tokens. Enterprises pay per use, and the data that trains and fine-tunes those systems flows back toward Microsoft and its partners.

That's the contradiction Nadella's own essay doesn't fully resolve. He named the risk accurately, even proposing a "trust boundary" to guard against it, while Microsoft keeps selling the rented compute and models that contribute to the problem in the first place.

For a regulated bank, defense contractor, or hospital system, that arrangement carries real friction. Compliance teams don't love sending sensitive workflows through a shared cloud model. Karp's sovereignty pitch is aimed squarely at that discomfort, and it's why the market's habit of treating PLTR and MSFT as interchangeable "AI plays" undersells a structural difference between them.

Every layer in Karp's sovereignty stack, including energy, compute, data, models, and applications, is a layer Microsoft currently rents to customers rather than hands over. That's the structural gap Palantir is selling against.

Palantir's Dell Deal Shows Sovereign AI in ActionPalantir's May tie-up with Dell Technologies NYSE: DELL, putting Foundry and Ontology on-premises inside Dell's AI Factory with NVIDIA NASDAQ: NVDA, is old news by now. But it's worth revisiting as evidence, not as the story itself.

The deal gives regulated and air-gapped customers a way to run Palantir's software inside their own walls, with no data ever touching a public cloud. That's the sovereign AI thesis, already shipping.

What Investors Should Watch for in Sovereign AI62nd Percentile

Moderate Buy

5.0% Upside

Healthy

N/A

0.80 Selling Shares

44.09%

See Full Analysis

None of this means Microsoft is losing the AI race.

Azure's scale and the company's relationship with OpenAI remain enormous advantages.

But if sovereignty becomes a bigger purchasing criterion for regulated buyers, Microsoft's cloud-first model is more exposed to that shift than the market's current pricing suggests.

Investors should watch enterprise AI procurement language over the next few quarters. If the words "data residency," "model ownership," and "air-gapped deployment" show up more often, it could be a significant tell.

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Key Takeaways Palantir posted 93% revenue growth in Q2, with U.S. government revenues rising 90%.BigBear.ai grew revenues 13% and backlog to $270 million, but adjusted EBITDA remained negative.Palantir raised 2026 revenue guidance to $8.15-$8.158B and sees $4.5-$4.7B in adjusted free cash flow. The rapid adoption of artificial intelligence across defense and national security is creating new opportunities for companies that can turn complex data into actionable intelligence. Against this backdrop, BigBear.ai Holdings, Inc. (BBAI - Free Report) and Palantir Technologies Inc. (PLTR - Free Report) are emerging as notable names in defense-focused AI, with both companies providing technology designed to support mission planning, decision-making and operational efficiency.

BigBear.ai is expanding its AI capabilities across defense, intelligence and homeland security, while Palantir continues to benefit from strong demand for the AI-powered data and analytics platforms, particularly from U.S. government customers. With differing scales, growth profiles and approaches to the defense AI opportunity, comparing the two stocks offers investors a closer look at their respective strengths and challenges.

The Case for BigBear.aiBigBear.ai delivered encouraging operational progress in the second quarter, with revenues rising 13% year over year to $36.7 million and gross margin expanding 781 basis points to 32.8%. The company also secured more than 20 new contracts during the quarter, while backlog increased to $270 million, up about $22 million from the start of the year. Management said it remains on track to achieve the 2026 revenue guidance of $135 million to $165 million.

However, profitability remains a significant concern. Adjusted EBITDA was negative $11.6 million in the quarter, compared with negative $8.5 million a year earlier, as BigBear.ai increased spending on sales, go-to-market activities and research and development. Despite the improved gross margin, higher operating investment shows the company has yet to translate its growth initiatives into stronger underlying earnings.

BigBear.ai’s strategy also relies heavily on continued investment and acquisitions to accelerate growth. Management said it intends to pursue additional M&A and described the current environment as a time to be aggressive, while noting that cash reserves will be deployed carefully. Although the company had $410 million in cash and investments at the end of the quarter, using that capital for acquisitions introduces execution and integration risks, particularly after the company recently integrated Ask Sage and CargoSeer.

Another challenge is that the company is competing in markets where scaling deployments remains critical. BigBear.ai highlighted promising applications in generative AI, cargo inspection and drone orchestration, but several of these opportunities are still being developed or expanded across customer environments. The company is positioning its products for large defense, security and trade markets, yet converting these opportunities into sustained, high-margin revenues will be important for validating the growth strategy.

The Case for PalantirPalantir delivered exceptional growth in the second quarter, with revenues surging 93% year over year to $1.94 billion. The company’s U.S. business remained the key growth engine, with revenue increasing 115%, while U.S. government revenues climbed 90%. Strong demand also drove $3.4 billion in total contract bookings, up 49% year over year, underscoring continued customer adoption of its AI platform across government and commercial markets.

The company’s defense AI opportunity is supported by deepening adoption of its platforms within the U.S. government. Palantir said its Maven platform now has more than 25,000 builders, including service members, government personnel, contractors and companies. A government program of record also selected Maven as its operating platform, highlighting the expanding role of Palantir’s technology in mission-critical defense applications.

Palantir’s financial performance provides another important strength. Adjusted free cash flow reached $1.22 billion in the quarter, representing a 63% margin, while adjusted operating margin stood at 62%. The company also ended the quarter with $9.2 billion in cash, cash equivalents and short-term U.S. Treasury securities. Management raised its full-year 2026 revenue guidance to $8.15-$8.158 billion and expects adjusted free cash flow of $4.5-$4.7 billion.

Despite these strengths, Palantir’s rapid expansion comes with elevated expectations. The company plans to continue investing heavily in its AI platform and technical talent, with adjusted expenses already rising 37% year over year in the second quarter. Management also expects a significant expense increase in the third quarter. With growth expectations exceptionally high, maintaining the current pace of expansion while sustaining profitability will be an important test for Palantir.

How Does the Zacks Consensus Estimate Compare for BBAI & PLTR?The Zacks Consensus Estimate for BBAI’s 2026 sales implies year-over-year growth of 15.1%. The consensus loss per share estimate is 27 cents, compared with a loss of 82 cents in the prior-year quarter. However, loss estimates for 2026 have widened over the past 30 days.

Image Source: Zacks Investment Research

For PLTR, the Zacks Consensus Estimate for 2026 sales and EPS indicates year-over-year growth of 81.8% and 113.3%, respectively. Earnings estimates for 2026 have also moved higher over the past 30 days.

Image Source: Zacks Investment Research

Stock PerformancePLTR stock has gained 28.4% over the past six months, easily beating the S&P 500’s 11.9% advance. Meanwhile, BBAI’s shares have fallen 25.6% during the same period.

Image Source: Zacks Investment Research

Valuation CheckBBAI is trading at a forward 12-month price-to-sales ratio of 9.24X, below its one-year median of 12.81X. PLTR’s forward sales multiple is 42.94X, slightly below its one-year median of 45.90X.

P/S (F12M)
Image Source: Zacks Investment Research

End NotesPLTR currently looks like the better defense AI investment because its growth is backed by strong customer adoption, government demand, profitability and cash generation, while BBAI is still working toward sustainable profitability. BigBear.ai has promising opportunities in defense and generative AI, but the ongoing losses, acquisition strategy and execution risks make it more speculative. Palantir has already established a strong position with U.S. government customers and is expanding its AI platforms across mission-critical defense applications.

While PLTR’s valuation is higher, its premium is supported by stronger fundamentals and execution. Its Zacks Rank #2 (Buy), compared with BBAI’s Zacks Rank #4 (Sell), further favors Palantir. Overall, PLTR offers the stronger combination of growth, profitability and financial stability.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A value investor ran Palantir through the same stress test he uses on every high-growth stock, and the result left him with a very specific price and a frank admission about what he still cannot explain.

On the latest We Study Billionaires episode, Preston Pysh admitted something value-leaning investors have quietly been thinking about Palantir (NASDAQ:PLTR | PLTR Price Prediction). The headline P/E overstates how expensive the company really is because the underlying growth is genuinely rare. Pysh still would not buy the stock here. His line, delivered with Daniel Mahncke and Shawn O’Malley on episode TIP841, was simple: “If you see the stock below $100 and nothing changes, count me in.”

Palantir closed Thursday at $185.93, well above that level, after gaining 50.51% in the past month alone on a blowout Q2 report. The $100 print is the easy takeaway. The more useful takeaway is the framework Pysh used to arrive at it, because that framework applies to every other AI-adjacent story in the market right now.

Halved-Growth Stress Test Pysh’s tool for fast-growing companies is a thought experiment: imagine the next earnings report comes in with growth cut in half, and ask whether you can explain why. If you can, you understand the business. If you cannot, you are along for the ride.

He compared two cases. Slower growth at Lululemon (NASDAQ:LULU) is easy to diagnose: customers either switched to a competitor or stopped spending. Slower growth at The Trade Desk (NASDAQ:TTD) is much harder to parse, and Pysh admitted, “I have absolutely no clue why the top line growth is declining, and I also have no clue where the bottom would be.”

Palantir sits in the harder bucket. Q2 U.S. commercial revenue grew 149% year-over-year, and total revenue grew 92.83%. If those numbers halved next quarter, would a retail shareholder be able to name the reason? Was it AIP land-and-expand hitting a natural ceiling, government procurement timing, or competition from hyperscalers offering their own operational AI layers?

Pysh’s answer is no: “I’m just not sure how many would still claim to understand the business that well.” That is the correct thing for a disciplined investor to say when the machinery under a stock is opaque.

Owner Versus Speculator Stig Brodersen framed the same idea from the other side. “To be an investor, that really means you have to think like an owner and feel like you understand all of the variables affecting the business. And so if you’re just buying a stock and you don’t have that owner mindset… well then you’re just speculating.”

The line between investing and speculating has little to do with the asset or the holding period. It has to do with whether you can articulate the variables driving the outcome. Much of Palantir ownership today sits on the speculative side of that line, which is acceptable if the position is sized accordingly. It becomes dangerous when someone has talked themselves into believing the position is conservative because the company is profitable and the CEO is confident. Brodersen noted that a real selloff could make Palantir “a really interesting entry point for folks who are willing to speculate more.” That is the useful framing.

Fair Reading of the Bull Case Pysh left the door open wider than a passing listener might notice. His colleague Daniel Mahncke ran a two-scenario DCF and concluded that on Karp’s own guidance, “the price-to-sales ratio would decline from about 60 today to about 20. And if you trust Karp’s estimates, the fair value is at about $240.”

The Q2 report supports that scenario in the short term. GAAP operating income reached $912 million, free cash flow hit $1.220 billion, and management raised FY2026 revenue guidance to $8.150 to $8.158 billion per the Q2 8-K.

If the Ontology platform is a real switching-cost moat inside government and enterprise workflows, forward multiples compress quickly. Pysh himself said that a better understanding of Ontology could change his view, and that the concession matters.

Cost of Drawing a Price Line Setting a level and waiting is a real strategy with a real cost. Palantir is up 623.18% over five years and roughly 2,809% from its January 2023 low. A business compounding this fast may simply never revisit $100.

Waiting for a level that never arrives is how disciplined investors miss decade-long winners. It is also how disciplined investors avoid ruinous drawdowns, because a forward P/E of 108x leaves no room for a stumble (we wrote a free handbook on riding a mania without giving back the gains, here). Both statements are true at once.

Pysh’s position reflects intellectual discipline. He is refusing to underwrite something he cannot fully explain, which is more useful for a retail investor to hear than another price target. The reader’s job is to decide which side of Brodersen’s line they are on, and then size accordingly.

Contact [email protected] for any questions or corrections.

A federal court just ruled the Pentagon's retaliation against an AI supplier illegal, and the fallout lands squarely on one of Palantir's most critical defense programs before a make-or-break September deadline.

A federal judge permanently blocked the Pentagon’s designation of Anthropic as a supply-chain risk, calling the action illegal and baseless. Judge Rita Lin concluded the government retaliated after Anthropic resisted unrestricted use of Claude for mass surveillance and autonomous weapons.

Palantir (NASDAQ:PLTR | PLTR Price Prediction) was not a party to the case, but the ruling touches the company’s most important defense AI program because Palantir’s Maven Smart System runs Anthropic’s Claude inside it, and the Pentagon plans to designate Maven as an official program of record by the end of September. Palantir closed at $186.29 Friday, up 51.46% over the past month. The question is whether removing the Anthropic overhang lowers Palantir’s execution risk enough to justify current valuations.

What the Court Ruling Changes Palantir gets no direct legal benefit as a non-plaintiff.

The practical effect: Palantir likely avoids rewriting orchestration inside classified environments on a compressed timeline, which is expensive and slow. The ruling does not require the Pentagon to retain Anthropic as a supplier, guarantee incremental Palantir revenue, or prevent a government appeal.

It shrinks tail risk that Maven’s model layer gets forcibly reshuffled before the program graduates to permanent funding status. Timing matters more than total addressable market for program-of-record designations.

Maven, Money, and Program of Record Maven’s existing contract ceiling was raised to $1.3 billion in 2025, and Palantir separately holds an Army agreement worth up to $10 billion. A ceiling is the maximum the government may spend, not revenue Palantir has earned.

The FY 2027 President’s Budget requests $2.3 billion for the Maven Smart System and Joint Fires Network to deliver joint command and control, part of a $58.5 billion AI investment line item. On the Q2 call, Shyam Sankar said “Maven continues to deliver for the joint force, from the factory floor to the foxhole” and that Maven now has over 25,000 builders using it. Management also said the Department of War trailing twelve-month revenue is “less than 25 basis points of the Pentagon’s budget”.

Palantir’s U.S. government revenue grew 90% year-over-year to $809 million in Q2, a level that a program-of-record catalyst would compound.

Why Integration Beats Any Single Model Palantir’s value sits in the integration layer above whichever frontier model the Pentagon picks. Sankar told analysts “We have a product that allows you to switch out models”, and Alex Karp added “It’s not about being beholden to one model. It’s about bringing the right models to bear for the right purposes.”

Sankar also described bringing in NVIDIA (NASDAQ:NVDA)’s Nemotron Ultra and finding five production tasks where a standard Nemotron Ultra model without post-training beat frontier models within 24 hours. If AIP is the orchestration and evaluation surface, model swaps become a platform feature rather than a contract threat. That is the real version of the sovereignty pitch.

The ruling reduces execution risk for Maven, and the broader thesis is that Maven deepens the question of whether Claude stays or goes.

Valuation Remains the Core Question Palantir trades at a forward P/E near 110x against a price-to-sales ratio of about 73x. Any bullish case must survive those numbers.

The offset is growth quality. Q2 revenue rose 93% year-over-year with a Rule of Forty score of 155 and adjusted free cash flow of $1.22 billion. The market is not fully convinced this holds. Polymarket assigns its highest probabilities to $180 at 0.315 and $192 at 0.305, and the August 31 directional market leans Down at 0.53. The $191.68 average analyst target is barely above spot, so the sell side is not underwriting a fresh leg higher on this news alone.

The ruling lowers execution risk on Maven’s path to program-of-record status without changing the valuation math. Watch the September designation closely, but do not expect overnight repricing.

Contact [email protected] for any questions or corrections.

Palantir Technologies (PLTR +3.44%) took in $1.94 billion of revenue in the second quarter and kept $1.06 billion of it as net income. Out of every dollar the artificial intelligence (AI) software specialist collected, 55 cents dropped to the bottom line.

For context, a year earlier the margin was 33%, and it ran at 36% across all of 2025. Software has always been a high-margin business. But numbers like these are rare at any scale, let alone for a growth stock still expanding revenue 93% year over year.

A margin that extreme deserves a closer look, because how Palantir earns its 55 cents matters as much as the figure itself.

Image source: The Motley Fool.

The operating engine does most of itMost of Palantir's profit is exactly what it looks like. Income from operations was $912 million in the second quarter, a 47% operating margin -- up from 27% in the year-ago quarter and 46% in the first quarter of 2026. The year-over-year jump is operating leverage in its purest form: revenue grew 93% while operating expenses rose just 34%, on a gross margin of about 85%.

And management's preferred summary of the quarter was a Rule of 40 score (revenue growth plus adjusted operating margin) of 155%.

"The sovereign AI revolution makes us very optimistic about the future," CEO Alex Karp said in the earnings release.

However you feel about the stock, that operating line is the most important part of the margin story. And it repeated, which matters. The first quarter ran a 46% operating margin, so this is now the established level, not a spike.

Interest and a tiny tax billThe remaining 8 cents come from below the operating line.

Palantir ended June with $9.2 billion of cash, equivalents, and short-term U.S. Treasuries, and that pile generated $77.5 million of interest income in the quarter. Another $91.8 million arrived as other non-operating income. And the tax bill was the unusual part. On $1.08 billion of pre-tax income, it came to about $15 million -- an effective rate of about 1.4%.

Run the same quarter at the 21% U.S. statutory rate instead, and the net margin lands closer to 44%. Still remarkable, just not 55%.

To be fair, this isn't a one-quarter quirk. The first quarter showed the same shape, with a 53% net margin against that 46% operating margin. But tax rates this low tend not to last as profitable companies scale, and interest income is a return on the cash pile, not on the software. The gap between 47 and 55 is the part of the margin a shareholder probably shouldn't count on keeping.

Can it hold?Management's own outlook says the profitability isn't going anywhere this year. Alongside the second-quarter report, Palantir raised its 2026 revenue guidance to between $8.150 billion and $8.158 billion, which implies 82% growth over 2025. It lifted its outlook for U.S. commercial revenue, the fastest-growing piece of the business, to more than $3.4 billion after that line grew 149% year over year to $764 million in the quarter.

On the profitability side, it guided to adjusted income from operations of about $4.9 billion and adjusted free cash flow of $4.5 billion to $4.7 billion, or about 55% to 58% of guided revenue. And the company said it continues to expect positive operating income and net income, under generally accepted accounting principles (GAAP), in each quarter of this year.

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The honest version of the headline number, then, goes like this. About 47 of the 55 cents come from the software business itself, before any tax. The rest is interest and other non-operating income, plus a tax rate that won't stay near zero forever. Palantir's own non-GAAP math assumes a long-term rate of 23%. And big profitable software companies do eventually pay something close to it.

I think that distinction matters mostly because of the price. Shares sit near $174 as of this writing, and the stock trades at more than 150 times earnings -- a valuation that treats today's extraordinary economics as a permanent feature.

That assumption leaves the work to revenue growth. A company already converting revenue to profit at this rate has little room to expand margins further -- from the first quarter to the second, the operating margin inched from 46% to 47%. From here, the stock's case rests almost entirely on growth staying extreme.

The profitability is exceptional, and most of it is the right kind. But at more than 150 times earnings, the price already assumes all of it continues.

Palantir Technologies ((PLTR - Free Report) ) has been one of the strongest fundamental growth stories in the market, but over the past year the stock itself has made relatively little progress. That may finally be changing.

Following its latest earnings report, PLTR broke decisively above the upper boundary of a large year-long consolidation pattern. Shares quickly advanced into the upper-$170s and have since spent several sessions trading sideways, forming a tight consolidation just below resistance near $179.

That creates a relatively straightforward trading setup. A decisive breakout above $179 would clear the recent highs and could open the door to another leg higher. Meanwhile, the recent consolidation around $170–$179 gives traders a clear range to monitor.

The technical picture is particularly interesting because the breakout is being supported by improving fundamentals and rising earnings estimates.

Image Source: TradingView

PLTR Stock Gets UpgradedPalantir reported another exceptional quarter recently, with revenue increasing 93% year over year and earnings climbing 225%.

Those results have driven another round of upward earnings estimate revisions. Palantir currently carries a Zacks Rank #1 (Strong Buy), with consensus earnings estimates rising nearly 8% across the board over the past 30 days.

Image Source: Zacks Investment Research

That estimate momentum matters. Some of the strongest stock trends occur when improving fundamentals and positive price momentum reinforce one another, and that appears to be happening with Palantir today.

Valuation remains the obvious concern. PLTR trades near 80x next year’s earnings, which is expensive on an absolute basis. However, that multiple has compressed substantially from the levels investors have historically paid for the stock.

For much of the past year, Palantir shares traded sideways while revenue and earnings continued to compound at very high rates. In effect, the business has been growing into the valuation even without a major advance in the share price.

Palantir's Expanding Role in AIThere may also be a broader fundamental catalyst emerging.

CEO Alex Karp has increasingly positioned Palantir as a differentiated AI platform for corporations and governments that want the benefits of artificial intelligence without giving up control of sensitive data, intellectual property or proprietary business information.

Karp has been particularly critical of the large AI labs and the potential risks associated with allowing proprietary information to become part of broader AI training systems. Palantir's pitch is effectively that enterprises can deploy advanced AI while maintaining much tighter control over their data.

There is evidence that customers are responding. Net dollar retention reached 157% in the latest quarter, indicating that existing customers are rapidly expanding their spending with Palantir.

That will be an important metric to follow. If customers continue moving deeper into Palantir's AI products, the company could increasingly establish itself as a core AI infrastructure layer across large corporations and government agencies.

Unity and Match Group: Two More Software Stocks Approaching a BreakoutMatch Group ((MTCH - Free Report) ) is another software stock approaching an important technical breakout. Match Group carries a Zacks Rank #1 (Strong Buy) and has spent roughly three years building a large base, with shares now testing a long-standing area of resistance.

The fundamental setup is also attractive. Earnings estimates are moving higher, while Match Group trades at just 9.6x forward earnings. With long-term EPS growth projected at 20.66% over the next three to five years, the stock carries a PEG ratio of just 0.47.

Image Source: TradingView

Unity Software ((U - Free Report) ) is developing a similar setup. Unity carries a Zacks Rank #2 (Buy), has seen strong upward earnings estimate revisions and is also emerging from a roughly three-year technical base. Unity shares have rallied sharply in recent weeks and are now pressing against a major resistance level.

Despite the recent move, Unity still offers an appealing growth-adjusted valuation. The stock trades at 38.9x forward earnings, while long-term EPS growth is projected at 41.33%, giving Unity a PEG ratio below 1.

Image Source: TradingView

Together, Match Group and Unity provide further evidence that momentum is broadening across software, with both stocks approaching potentially significant technical breakout levels.

Is PLTR Stock Ready to Break Out?Palantir now has several factors moving in the same direction: exceptional revenue and earnings growth, sharply rising earnings estimates, a Zacks Rank #1 and a potentially important expansion of its role within enterprise AI.

The technical setup adds another catalyst.

PLTR has already broken out of its much larger year-long pattern and is now consolidating near the highs. A move above roughly $179 would represent the next technical breakout and could signal the beginning of another leg higher.

The valuation remains rich, so this is not a low-risk setup. But with fundamentals improving and the stock pressing against clearly defined resistance, Palantir is one of the more compelling momentum setups in the market right now. The similar strength developing in Unity and Match Group also suggests that the move may be in part, driven by a broader improvement in software stocks.