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(Bloomberg) — Palantir Technologies Inc. reported quarterly revenue that beat analysts’ estimates and raised its forecast for operating income in the current period, citing high demand in the US for its artificial intelligence software.
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The company’s stock jumped about 13% in after-hours trading following the report.
Third-quarter sales increased 30% to $725.5 million, the Denver-based company said Monday in a statement. Analysts, on average, estimated $703.7 million, according to data compiled by Bloomberg. Palantir also reported net income of $144 million, a record for the company.
“The growth of our business is accelerating, and our financial performance is exceeding expectations as we meet an unwavering demand,” from government and commercial customers in the US, Palantir Chief Executive Officer Alex Karp wrote in a letter Monday to shareholders. “The world is in the midst of a US-driven AI revolution that is reshaping industries and economies, and we are at the center of it.”
The company raised its revenue guidance for 2024 to about $2.81 billion. Analysts expected $2.76 billion. The company also reported a substantial increase on a closely watched metric: revenue from its US commercial business, a key driver of sales growth. Palantir expects its US commercial revenue to climb over 50% this year, to more than $687 million.
Palantir’s share price soared after introducing new AI tools last year, becoming a marquee stock of a tech industry frenzy. The share price is up more than 140% so far this year, fueled by demand for its AI software and events such as its recent inclusion in the S&P 500.
Palantir delivered adjusted earnings of 10 cents a share in the period ended Sept. 30, beating analyst estimates of 9 cents. The company projected fourth-quarter adjusted operating income of about $300 million, compared with the average estimate of $261.6 million.
Although Palantir counts global organizations like energy giant BP Plc and the UK’s National Health Service among its customers, demand overseas for its AI software has been weak compared with the US. The company said $499 million of its revenue for the third quarter, about 70%, came from American customers.
“The US is driving the AI revolution we’re seeing,” said Chief Revenue Officer Ryan Taylor during a Monday interview. Taylor said Palantir closed 104 deals over $1 million during the third quarter, thanks largely to its unconventional sales strategy of holding bootcamps to teach customers to use its tools.
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