Peter Thiel's Palantir surges after crushing earnings and raising its full-year forecast

Palantir (NASDAQ: PLTR) jumped 12% in late trading after Monday’s earnings release as the software company beat Wall Street’s second-quarter targets and lifted its 2026 forecast.

Adjusted profit came to 41 cents a share, above the 35 cents expected by analysts tracked by London Stock Exchange Group (LSE: LSEG). Revenue reached $1.94 billion, topping the $1.80 billion estimate. Commercial sales also more than doubled from the same period last year.

The rally came after Palantir shares had fallen 29% this year. Investors had been worried that the AI software trade was losing energy and that growth rates could cool. Palantir raised its full-year revenue target and said it now expects 71% growth, which is 10 percentage points above the forecast issued in the prior quarter.

Palantir doubles its U.S. business as commercial sales and contract values climb

Palantir’s first-quarter 2026 figures showed total revenue of $1.633 billion, up 85% from a year earlier and 16% from the previous quarter. U.S. revenue reached $1.282 billion after climbing 104% year over year and 19% quarter over quarter.

U.S. commercial revenue rose 133% from a year earlier and 18% from the prior quarter to $595 million. U.S. government revenue increased 84% year over year and 21% sequentially to $687 million.

Contract activity also grew. Palantir signed 206 deals worth at least $1 million. That total included 72 contracts worth $5 million or more and 47 worth at least $10 million. Total contract value came to $2.41 billion, up 61% from a year earlier.

U.S. commercial contract value reached $1.176 billion, a 45% annual increase. Remaining deal value for the U.S. commercial unit rose to $4.92 billion, up 112% year over year and 12% from the previous quarter.

The unaudited quarter produced $753.998 million in GAAP operating income, equal to a 46% margin. Adjusted operating income reached $983.545 million, or 60% of revenue.

Cash from operations totaled $899.165 million with a 55% margin, while adjusted free cash flow came to $924.630 million with a 57% margin. Net income attributable to common shareholders was $870.527 million, equal to 53% of sales. Adjusted net income was $856.450 million.

Adjusted EBITDA reached $990.310 million, giving Palantir a 61% margin. Diluted GAAP earnings were 34 cents a share, while adjusted diluted earnings were 33 cents. The company ended the period with $8 billion in cash, cash equivalents, and short-term U.S. Treasury securities. Its Rule of 40 score reached 145%.

Palantir raises its 2026 targets as Alex Karp points to faster U.S. demand

For the second quarter of 2026, Palantir expects revenue between $1.797 billion and $1.801 billion. Adjusted operating income is forecast between $1.063 billion and $1.067 billion. For the full year, management now expects revenue from $7.650 billion to $7.662 billion.

Palantir also raised its U.S. commercial revenue target to more than $3.224 billion, which would mean growth of at least 120%. Adjusted operating income is now expected between $4.440 billion and $4.452 billion.

Adjusted free cash flow is projected between $4.2 billion and $4.4 billion. The company still expects GAAP operating profit and GAAP net income in every quarter this year.

Palantir co-founder and Chief Executive Officer Alex Karp said the company’s Rule of 40 score had “soared to 145%.” He compared that result with AI infrastructure groups NVIDIA (NASDAQ: NVDA), Micron Technology (NASDAQ: MU), and SK hynix (KRX: 000660).

Alex said the company reached its fastest annual growth rate after more than doubling its U.S. business and said stronger demand in the domestic market supported the higher outlook.

Alex also said U.S. commercial sales grew 28% from one quarter to the next. He argued that Palantir completed in 90 days what some companies might need a year to achieve. He added that the result came while the sales team stayed very small and continued shrinking.

Alex described the U.S. commercial unit as “just nascent” and said Palantir gets paid based on the value its software creates for customers.

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