Palantir (PLTR) CEO Alex Karp says he is optimistic about the disruption brought about by Elon Musk’s DOGE, even predicting the company would benefit from Federal cost-cutting efforts.
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Karp thinks the newly minted Department of Government Efficiency (DOGE) will be good for the U.S. and for Palantir, the big data analytics and AI company. It has large government contracts, particularly with the Department of Defense and intelligence services.
DOGE would be “very good for Palantir,” which derives about two-thirds of its U.S. revenues from government contracts, Karp told analysts on the earnings call last night.
“Disruption, at the end of the day, exposes things that aren’t working,” he said. “There will be ups and downs. There’s a revolution. Some people are going to get their heads cut off. We’re expecting to see really unexpected things and to win.”
PLTR Earnings Rise
The comments from Karp followed a handsome beat for PLTR earnings in its Fiscal fourth quarter. Earnings per share came in at $0.14 versus the $0.11 expected on revenues of $828 million vs. $776 million expected.
U.S. revenue for the quarter rose 52% year-over-year, while overall revenue growth stood at 36%. Palantir said its U.S. government revenue for Fiscal year 2024 grew 30% year-over-year to $1.2 billion, with growth accelerating to 45% in this segment in Q4. U.S. commercial revenue in the fourth quarter grew 64% year-over-year and 20% quarter-over-quarter to $214 million.
“We are still in the earliest stages, the beginning of the first act, of a revolution that will play out over years and decades,” Karp told shareholders in a letter.
Shares of PLTR surged in after-hours trading following the earnings update and extended gains in the pre-market, with the stock up 23%.
Is PLTR a Good Stock to Buy?
After a 400% rally in the shares, analysts have a consensus Hold rating on PLTR stock, based on two Buy, 10 Hold and five Sell ratings. The average PLTR price target is $69.50 but is liable to revisions in the wake of the earnings update on Monday night.
