AI Spending Surge Drives Palantir, DigitalOcean Gains

This piece talks of the largest fear likes of Palantir is susceptible to, namely unsustainable growth. I see the opposite problem. GenAI is tinkering on the periphery.

True growth requires companies take a holistic spectrum of people, process, technologies to achieve sustainable growth from AI through transformation and that is not achieved by incremental initiatives.

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Data analytics company Palantir Technologiesreported that its third-quarter revenue rose 30% year over year (YoY) as demand for AI tools fueled strong growth in its commercial business.

The Denver-based company on Monday (Nov. 4) posted revenue of $726 million, compared with $558 million a year earlier. U.S. commercial revenue, a key metric watched by analysts, jumped 54% YoY to $179 million. The company reported GAAP earnings of 6 cents per share, up dfrom 3 cents in the year-ago period.

“We absolutely eviscerated this quarter, driven by unrelenting AI demand that won’t slow down,” CEO Alexander Karp said in a news release. “This is a U.S.-driven AI revolution that has taken full hold.”

The company added new customers rapidly, with the total customer count rising 39% from a year earlier. During the quarter, Palantir closed 104 deals worth over $1 million. Adjusted free cash flow reached $435 million, representing a 60% margin.

The company raised its full-year outlook, expecting revenue between $2.805 billion and $2.809 billion. It also projected U.S. commercial revenue growth of at least 50% for the year. Palantir’s U.S. government revenue grew 40% to $320 million.