Palantir Technologies (PLTR) shares jumped 12% in premarket trading on Tuesday, after the software analytics powerhouse posted fourth-quarter results that exceeded Wall Street expectations, bolstered by strong sales to the Trump administration and US commercial clients.
The company’s revenue soared 70% year-over-year to $1.4 billion, surpassing the $1.3 billion forecast from analysts tracked by Bloomberg. Adjusted earnings per share rose to $0.25, well above last year’s $0.14 and beating the projected $0.23.
Palantir also raised guidance for 2026, signaling continued momentum: first-quarter revenue is expected at $1.5 billion, ahead of analysts’ $1.3 billion estimate, while the full-year revenue outlook of roughly $7.2 billion exceeds the consensus $6.3 billion.
US Sales Power the Surge
Palantir’s outperformance was driven largely by its domestic business:
US commercial revenue: +137% YoY to $507 million, beating estimates of $479 million
US government revenue: +66% YoY to $570 million, above the expected $522 million
This strong domestic demand offset concerns stemming from a recent sell-off in software equities, as well as fears that AI could disrupt traditional software providers. Over the past month, Palantir stock had dropped roughly 12%, in line with broader tech weakness in the S&P 500.
CEO Alex Karp: Built for the AI Era
Speaking with Yahoo Finance’s Josh Lipton ahead of the earnings release, CEO Alex Karp acknowledged AI’s potential to challenge legacy software companies.
“In tech, you only have a time horizon of a couple years. You can’t say we will never be disrupted,” Karp said.
“But we made investments in this tech years ago, all of which we thought would be valuable. The products and the culture we have are ideally built for the time we are in now. We are a different species of company.”
Karp’s comments underscore Palantir’s strategy of positioning its platform to complement AI rather than compete against it, leveraging its data analytics expertise and longstanding government relationships.
Analyst Upgrades Add Fuel
The earnings beat also caught the attention of Wall Street analysts. William Blair analyst Louis DiPalma upgraded Palantir stock to Outperform, noting that recent price weakness has made the firm’s valuation “more reasonable.”
DiPalma cited the company’s work with the Trump administration, particularly in government and defense analytics, as a key differentiator. Palantir’s contracts with ICE and other federal agencies have drawn public criticism, but they also highlight the firm’s unique government positioning.
The Road Ahead
With strong domestic sales, record revenue growth, and robust guidance, Palantir appears poised to weather both AI-driven market disruption and broader tech volatility.
Investors will be watching closely to see if the firm can sustain its momentum through government and commercial partnerships, while continuing to innovate in the rapidly evolving AI and analytics space.
Premarket optimism signals that Wall Street may be recalibrating its view of Palantir, treating the stock as a resilient player in software and data analytics, uniquely insulated from some of AI’s more disruptive effects.