Alexander Karp, CEO and co-founder of Palantir Technologies Inc.
Scott Eelis | Bloomberg | Getty Images
Palantir‘s astronomical rise since its public debut on the New York Stock Exchange in a 2020 direct itemizing has been nothing in need of a whirlwind.
Over practically 5 years, the Denver-based firm, whose co-founders embrace famend enterprise capitalist Peter Thiel and present CEO Alex Karp, has surged greater than 1,700%. At the identical time, its valuation has damaged new highs, dwarfing among the world’s know-how behemoths with far higher revenues.
The artificial intelligence-powered software program firm continued its ascent final week after posting its first quarter with greater than $1 billion in income, reaching new highs and hovering previous a $430 billion market valuation.
Shares have not been beneath $100 since April 2025. The inventory final traded beneath $10 in May 2023, earlier than starting a gentle climb increased.
Retail investors are a key a part of the inventory’s energy.
Last month, retail poured $1.2 billion into Palantir inventory, in response to information from Goldman Sachs.
Here’s a more in-depth have a look at Palantir’s growth over the previous 5 years and the way the corporate compares to megacap friends.
Government cash
Government contracts have been considered one of Palantir’s largest growth areas since its inception.
Last quarter, the corporate’s U.S. authorities income grew 53% to $426 million. Government accounted for 55% of the corporate’s whole income however industrial is exhibiting promise. Those revenues in the U.S. grew 93% final quarter, Palantir mentioned.
Still, one of many firm’s oldest clients is the U.S. Army.
Earlier this month, the corporate inked a contract value as much as $10 billion for information and software program to streamline efficiencies and meet rising navy wants. In May, the Department of Defense boosted its settlement with Palantir for synthetic intelligence-powered battlefield capabilities by $795 million.
“We still believe America is the leader of the free world, that the West is superior,” Karp mentioned on an earnings name earlier this month. “We have to fight for these values; we should give American corporations, and, most importantly, our government, an unfair advantage.”
Beyond the U.S.
The U.S. has been a key driver of Palantir’s growth, particularly as the corporate scoops up extra contracts with the U.S. navy.
Palantir mentioned the U.S. at the moment accounts for about three-quarters of whole revenues. Commercial worldwide revenues declined 3% final quarter and analysts have raised concerns about that section’s growth trajectory.
Over the previous 5 years, U.S. revenues have practically quintupled from $156 million to about $733 million. Revenues outdoors the U.S. have doubled from about $133 million to $271 million.
Paying a premium
Palantir’s market capitalization has quickly ascended over the previous yr as buyers guess on its AI instruments, whereas its inventory has soared practically 500%.
The meteoric rise positioned Palantir among the many top 10 U.S. tech companies and high 20 most precious U.S. companies. But Palantir makes a fraction of the income of the businesses in these lists.
Last quarter, Palantir reported greater than $1 billion in quarterly income for the primary time, and its ahead price-to-earnings ratio has surged previous 280 occasions.
By comparability, Apple and Microsoft posted income of $94 billion and $76 billion through the interval, respectively, and carry a P/E ratio of practically 30 occasions.
Forward P/E is a valuation metric that compares an organization’s future earnings to its present share worth. The increased the P/E, the upper the growth expectations or the extra overvalued the asset. A decrease price-to-earnings ratio suggests slower growth or an undervalued asset.
Most of the “Magnificent Seven” shares, aside from Nvidia and Tesla, have a ahead P/E that hovers across the 20s and 30s. Nvidia trades at greater than 40 occasions ahead earnings, whereas Tesla’s sits at about 198 occasions.
At these ranges, buyers are paying a jacked-up premium to personal shares of one of many hottest AI shares on Wall Street as its valuation has skyrocketed to astronomical heights.
“This is a once-in-a-generation, truly anomalous quarter, and we’re very proud,” Karp mentioned on an earnings name following Palantir’s second-quarter outcomes. “We’re sorry that our haters are disappointed, but there are many more quarters to be disappointed.”
— CNBC’s Gabriel Cortes contributed to this story.
