Harsh Chauhan, The Motley Fool
4 min read
Palantir Technologies (NASDAQ: PLTR) has made a parabolic move on the stock market lately, with shares of the company jumping 39% since Aug. 3, the day when it released its Q2 earnings report.
This incredible jump in Palantir stock has been fueled by the company’s stronger-than-expected Q2 numbers and an improved full-year guidance. The good news for investors is that the recent rally in this artificial intelligence (AI) software specialist is poised to continue over the coming year.
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Let’s see why that’s likely to be the case.
Palantir’s accelerating growth trajectory is sustainable
Palantir’s Q2 revenue surged 93% year over year to $1.94 billion, well above the 48% revenue growth it reported in the same quarter last year. What’s more, Palantir’s non-GAAP earnings per share (EPS) jumped at a stronger pace of 156% year over year to $0.41.
The company’s terrific results can be attributed to the strong demand for its Artificial Intelligence Platform (AIP), which enables customers to integrate generative AI models with their proprietary data. Palantir notes that its total contract value (TCV) surged 49% year over year in Q2 to $3.37 billion, significantly exceeding the company’s top line.
The surge in Palantir’s TCV strengthened its revenue pipeline. This is evident from the company’s remaining deal value (RDV) of $13.1 billion, an 83% jump from the year-ago period. RDV is the total value of contracts that Palantir is yet to fulfill at the end of a quarter. The size of this metric clearly tells us that Palantir’s improving growth trajectory is sustainable.
Palantir’s robust revenue pipeline is why it has raised its full-year guidance. The company expects full-year revenue of just over $8.15 billion, implying an 82% increase over last year. It is worth noting that Palantir was originally expecting 2026 revenue of almost $7.19 billion when the year began.
I won’t be surprised to see Palantir boosting its guidance in the future as well. That’s because the company added 200 new customers in Q2 compared to the year-ago period. The new customers Palantir wins tend to expand adoption of its AI software offerings. This is evident from the company’s net dollar retention rate, which compares the trailing twelve-month revenue from customers at the end of a quarter to the trailing twelve-month revenue from the same customers in the year-ago quarter.
