Geoffrey Seiler, The Motley Fool
5 min read
Palantir Technologies (NASDAQ: PLTR) turned in another quarter of impressive results, as revenue growth once again accelerated. However, the stock dipped on the news and is down more than 15% over the past year.
Let’s dig into Palantir’s Q3 results and prospects to see why I think it could become one of the biggest winning artificial intelligence (AI) winners of the next decade.
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Another great quarter
For the 13th straight quarter, Palantir’s quarterly revenue growth accelerated. Its year-over-year revenue growth has now gone from 13% in Q2 2023 to 96% in Q3 2026.
Its Q3 revenue of $2.31 billion also handily topped management’s prior forecast of $2.16 billion to $2.164 billion and the analyst consensus of $2.18 billion, as compiled by LSEG. Adjusted earnings per share, meanwhile, surged from $0.18 to $0.44, besting the $0.41 consensus.
Data source: Palantir. All figures represent year-over-year growth.
U.S. commercial revenue yet again led the way, as customers continue to embrace and expand their use of its Artificial Intelligence Platform (AIP). U.S. commercial revenue surged 148% to $984 million in the quarter, while U.S. commercial remaining deal value climbed 79% to $6.52 billion. Meanwhile, the company closed U.S. commercial deals worth $1.46 billion in total contract value in the quarter, an 11% year-over-year increase.
In my view, the most impressive metric from Palantir’s report was once again its net revenue retention, which measures revenue growth from existing customers that have been with the company for more than a year. This expanded to 165% from 157% in Q2, showing how quickly existing customers are increasing their spending with Palantir. This metric also shows how valuable its customers believe its platform is.
Palantir also continues to add new customers, with its U.S. commercial customer count climbing by 29% year over year and 5% sequentially. Its overall customer count increased by 20% year over year and 4% sequentially.
On the government side of its business, revenue surged 81% year over year to $1.15 billion. U.S. government revenue skyrocketed 96% to $953 million. International government revenue, meanwhile, increased by 31% to $192 million. Its smaller international commercial segment revenue rose by 21% to $184 million.
