Palantir (NASDAQ: PLTR) is a major US software firm that specializes in human-driven data analytics and big data platforms. The company’s stock soared 22%+ in premarket trading on Tuesday, February 4, 2025, following the release of its Q4 fiscal 2024 results.
Palantir Q4 Results Beat Estimates
Palantir reported revenue of $828 million for the fourth quarter of fiscal 2024, beating estimates of $776 million. Its earnings per share came in at $0.14, above estimates of $0.11. Revenue was up 36% year-over-year, and up 14% quarter-over-quarter. Palantir stock has experienced a huge boost from the generative AI boom that followed the release of ChatGPT in late 2022.
Other Q4 Financial Highlights
The company reported that it closed 129 deals of at $1 million in the quarter, 58 deals of at least $5 million, and 32 deal of at least $10 million. Its US commercial total contract value for the quarter was $803 million, a 134% Year-over-year, and 170% quarter-over-quarter increase.
Its US commercial remaining deal value was $1.79 billion, a 99% YoY increase and 47% Q/Q increase. The US government remains its biggest single source of revenue, increasing 45% YoY and 7% Q/Q to $343 million. Meanwhile, US commercial revenue increased 64% YoY and 20% Q/Q to $214 million. In total, its US revenue was up 52% YoY and 12% Q/Q to $558 million.
The company reported a 43% YoY increase in customer count YoY and 13% Q/Q. Meanwhile, cash from operations came in at $460 million, a 56% margin, while adjusted free cash flow came in at $517 million, for a 63% margin.
Palantir reported a GAAP net income of $79 million, a 10% margin, and net income of $165 million, excluding one-time SAR-related expenses, for a 20% margin.
Its GAAP income from operations was $11 million, a 1% margin, and a net income of $142 million, excluding one-time SAR-related expenses, for a 17% margin, excluding one-time SAR-related expenses. Adjusted income from operations came in at $373 million, for a 45% margin.
The company ended the quarter with $5.2 billion in cash and cash equivalents.
Full-Year Highlights
For the full year, Palantir reported a 38% increase in US revenue to $1.9 billion, while full year revenue increased 29% to $2.87 billion. Its cash from operations came in at $1.15 billion, for a 40% margin, while adjusted free cash flow came in at $1.25 billion, for a 44% margin. Meanwhile, adjusted income from operations came in $1.13 billion, for a 39% margin.
2025 Outlook
For the first quarter of fiscal 2025, Palantir expects revenue of $858 to $862 million, beating estimates of $799 million at the midpoint. Additionally, it forecasts an adjusted income from operations of $354 to $358 million.
For the full year, the company expects revenue of $3.741 to $3.757 billion, beating estimates of $3.52 billion at the midpoint. It expects US commercial revenue of over $1.079 billion, a 54% YoY increase, and adjusted income from operations of $1.551 to $1567 billion. Palantir forecast adjusted free cash flow of $1.5 to $`1.7 billion, and a GAAP operating income, and net income for every quarter of fiscal 2025.
The DOGE Impact
During the earnings call, Palantir CEO Alex Karp stated that the Department of Government Efficiency (DOGE), headed by Elon Musk, was expected to have a positive impact on Palantir. He noted that the company already generates nearly two-thirds of its US-based revenue from government contracts. According to him, disruptions expose things that “are not working.” Karp stated that “some people will get their heads cut off,” he added that they were “expecting to see really unexpected things and to win.”
Palantir Stock Performance
Following the release of the Q4 fiscal 2024 results, PLTR stock soared 26.26% as off 11:00:48 AM EST to $105.73 per share. The stock is up 238.48% in the past six months, as of Monday’s closing price of $83.74, and 391.01% in the past 12 months.
Despite the stellar performance, analysts remain cautious about PLTR, giving it a hold rating. They forecast a price of $69.50 for the stock, which is a 17.01% downside. The most optimistic analysts forecast a price of $125.00, while the most pessimistic expect the price to drop to $35 per share.
Should You Add PLTR To Your Portfolio?
Palantir’s latest results have generated a lot of excitement among investors. The company has demonstrated that positive net income is possible with AI technology, which could spark further interest in AI. With the company leading the way in the ongoing “AI arms race,” getting in now could potentially lead to a positive outcome in the medium term. It is especially so with Elon Musk, whose goal is to improve government efficiency, at the helm. It could trigger a rise in interest for Palantir products, further boosting the company’s valuation.
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