Palantir's third-quarter results beat Wall Street estimates, and U.S. commercial revenue topped U.S. government revenue for the first time. The company raised its full-year guidance, while total contract value grew far slower than sales.
Palantir reported U.S. commercial revenue of $984 million, which surpassed U.S. government revenue of $953 million. It is the first time the commercial segment has come out ahead. Businesses are adopting more of the company's artificial intelligence tools.
According to MarketWatch, CEO Alex Karp said: "The dominant part of our business is now U.S. commercial."
Revenue and earnings top estimates
Overall revenue grew 96% from a year before to $2.31 billion, against $2.18 billion expected by analysts. It was Palantir's first quarter with more than $2 billion in revenue.
Adjusted earnings per share came in at 44 cents, compared with 41 cents expected, according to LSEG estimates cited by CNBC. Net income more than doubled to $1.13 billion from about $476 million.
U.S. commercial revenue jumped 148%, while government revenue rose 96%. Karp also said Palantir grew its U.S. commercial segment while keeping headcount flat.
Higher outlook, slower new deals
Palantir lifted its guidance for the year. It now expects full-year revenue of about $8.53 billion, and U.S. commercial revenue above $3.56 billion. For the fourth quarter, the company projects about $2.65 billion in revenue.
However, new business grew far less than sales. Palantir closed total contract value of $2.92 billion, up 6% year over year, and closed 64 deals worth at least $10 million.
The Motley Fool noted that U.S. commercial remaining deal value rose just 4% from last quarter, while U.S. commercial revenue rose 29%. The outlet said growth will be hard to hold if that backlog does not speed up.
Sources: CNBC, MarketWatch, The Motley Fool
Trading involves risk.
Risk Disclaimer
