iTechGuides is reader-supported. When you buy through links on our site, we may earn an affiliate commission. As an Amazon Associate I earn from qualifying purchases. Learn more
Palantir should be evaluated in three separate layers: what the company has already reported under GAAP, how management’s adjusted figures and guidance change the picture, and what the market price assumes about future growth and profitability. The latest figures reviewed here cover the quarter ended June 30, 2026, while the valuation snapshot uses the October 12, 2026 closing price. This is an analytical framework, not a personalized buy or sell recommendation.
Start with the right question
A fast-growing company can be an excellent business and still be an expensive stock. The first judgment is operational: Is Palantir increasing revenue, retaining customers, producing durable margins, and converting contracts into recognized sales? The second judgment is valuation: Does the share price already assume so much growth and profit that even a strong business could produce disappointing returns if execution merely falls short of perfection?
Keep three evidence sets separate:
- Historical GAAP results: audited or filed revenue, expenses, operating income, margins, assets and liabilities.
- Management-defined measures: adjusted operating income, adjusted margins and forward guidance. These can be useful for operating analysis but exclude costs that GAAP records.
- Market-derived multiples: price-to-sales, price-to-earnings and market capitalization at a stated date. Multiples change whenever the stock price or earnings estimates change.
Using those layers prevents a common error: treating a high growth rate as proof that the stock is cheap, or treating a high multiple as proof that the company is poor. The conclusion depends on the growth, margins, dilution and risks that the current price already discounts.
Quick wins for a faster PC:
Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Clear out junk files and repair common Windows errorsFree Scan →Scan for outdated or missing drivers - takes under a minuteDriver Scan →Data cutoff and the latest reported results
The latest company quarter covered here is Palantir Technologies’ second quarter of 2026, ended June 30, 2026. The market figures are a point-in-time snapshot from the October 12, 2026 close, reported by StockAnalysis using market data attributed to S&P Global Market Intelligence. Filings and prices can change after those dates, so an investor applying this framework should replace the snapshot with the newest Form 10-Q, Form 10-K, earnings release and market quote.
#1 Best Overall
- Comes with secure packaging
- Easy to read text
- It can be a gift option
Measure revenue growth without extrapolating one quarter
Palantir reported a sharp acceleration in the periods shown below. The comparisons are useful, but each covers a different time span; the 93% quarterly increase should not simply be multiplied across four quarters to create a forecast.
| Period | Revenue | Year-over-year growth | What it tells you |
|---|---|---|---|
| FY2025 | $4.5 billion | 56% versus FY2024 | Full-year baseline |
| Q2 2026 | $1.9 billion | 93% versus Q2 2025 | Latest quarterly pace |
| First half of 2026 | $3.6 billion | 89% versus first half of 2025 | Six-month check on quarterly momentum |
The first-half result is an important cross-check because it reduces the risk of reading too much into one reporting period. Even so, six months is not a complete cycle for a business with long, unpredictable sales processes and potentially lumpy contract timing.
Ask whether growth is repeatable
Revenue growth is more durable when it comes from renewals, expansions and a broad base of deployments rather than a small number of unusually large contracts. Palantir reported 1,049 customers at June 30, 2026, compared with 849 one year earlier. That increase indicates a larger customer base, but customer count alone does not show retention, spending per customer, implementation cost or profitability. Pair it with net retention or expansion information when the company reports it, renewal rates, average contract size and the proportion of revenue from new versus existing customers.
Separate customer and geographic mixes
Aggregate growth can conceal very different trajectories in U.S. commercial, government and international operations. A useful review breaks out each category in the latest filing and compares its growth, margin contribution and contract duration. Government revenue may be affected by appropriations, procurement timing and election or policy changes; commercial revenue may respond more quickly to economic conditions and sales-cycle friction. International growth can add currency, regulatory and implementation variables.
Palantir’s Q4 2025 earnings release said U.S. commercial revenue grew 137% year over year in that quarter and issued FY2026 revenue-growth guidance of 61% year over year on February 2, 2026. That was management guidance at that date, not an achieved result or a current forecast. Compare it with the later reported first-half growth and any updated guidance rather than presenting it as though it remains unchanged.
Use management guidance correctly
“We are also announcing a 2026 revenue growth guide of 61% year-over-year.”
Alex C. Karp, Palantir’s co-founder and chief executive officer, made that statement in the company’s February 2, 2026 Q4 earnings release. A guidance figure is a management expectation with assumptions and execution risk. It belongs beside subsequent actual revenue, not in place of it. When guidance changes, record the date, the old range, the new range and the reason management gave.
Rank #2
- Ideal for Gifting
- Ideal for a bookworm
- Comes with Proper Binding
Put GAAP margins first, then explain adjusted margins
Margins show how much of each revenue dollar remains after direct costs and operating expenses. Start with GAAP because it includes stock-based compensation and other expenses required by accounting rules. Then show the company’s adjusted measure and identify every material exclusion.
| Metric | Q2 2026 reported value | Interpretation |
|---|---|---|
| GAAP gross margin | 85% | Gross profit after all GAAP cost of revenue |
| Gross margin excluding stock-based compensation | 86% | Management-defined view that removes stock-based compensation from the calculation |
| GAAP operating income | $912 million | Approximately 48% of $1.9 billion revenue, calculated from the rounded reported figures |
| Adjusted operating margin | 62% | Excludes stock-based compensation and related employer payroll taxes |
The 14-percentage-point gap between the approximately 48% GAAP operating margin and the 62% adjusted margin is not a minor presentation detail. It quantifies how much the excluded compensation and payroll costs affect reported operating profitability. A company can use adjusted figures to show underlying operating trends, but investors should not treat a cost as economically irrelevant merely because it is excluded from a non-GAAP metric.
Compare the full-year baseline
| FY2025 measure | GAAP | Excluding stock-based compensation |
|---|---|---|
| Gross margin | 82% | 84% |
| Operating income | $1.4 billion | $2.3 billion adjusted operating income |
Palantir’s FY2025 filing says non-GAAP measures should be considered alongside GAAP measures, not in place of or isolation from them. The full-year reconciliation makes that instruction concrete: the adjusted operating-income figure is $900 million higher than GAAP operating income.
Treat stock-based compensation as a real economic cost
For the six months ended June 30, 2026, Palantir recorded $466.8 million of stock-based compensation expense, compared with $315.3 million in the same period of 2025. Stock-based compensation is noncash in the period it is recorded, but issuing equity can dilute existing shareholders and represents compensation for employee services. Evaluate both the expense recognized in the income statement and the change in diluted shares outstanding.
What’s actually slowing this PC down?
Pick the symptom - the matching free tool is one click away.
A practical per-share check is to compare revenue and GAAP operating income growth with diluted share-count growth. If total profit rises but the share count rises nearly as quickly, the benefit to each share is smaller. Also inspect how much of adjusted operating income is removed for stock compensation and related payroll taxes; a widening exclusion can make adjusted margin expansion look stronger than GAAP economics.
Use contracts as visibility, not as guaranteed revenue
Remaining performance obligations (RPO) represent noncancelable contracted revenue that has not yet been recognized, according to the June 30, 2026 filing. Palantir reported $4.9 billion of RPO at that date.
| Expected recognition window | Share of $4.9 billion RPO | How to read it |
|---|---|---|
| Next 12 months | Approximately 43% | Near-term contracted amount subject to the contract terms and recognition rules |
| Following 13–36 months | Approximately 36% | Medium-term visibility, with more time for timing and execution changes |
The percentages do not add up to a promise that every dollar will become revenue. Customer arrangements may be terminable for convenience, and government options can depend on future appropriations and decisions. RPO also does not describe the total potential value of every broader relationship or opportunity. Track the conversion of RPO into reported revenue over several quarters and investigate material changes in cancellations, modifications or implementation timing.
Do not confuse RPO with contract liabilities
Palantir reported contract liabilities of $1.1 billion on June 30, 2026, compared with $0.8 billion on December 31, 2025. Contract liabilities are deferred revenue and customer deposits: amounts received or billed before the company has delivered the related performance. They are not equivalent to revenue already earned, cash profit or RPO. Analyze the balance, additions and releases separately in the cash-flow and footnote disclosures.
Recommended Free Tools
Read the valuation snapshot as a set of assumptions
At the October 12, 2026 close, StockAnalysis reported the following market-derived figures for PLTR:
| Valuation measure | Reported value | Qualification |
|---|---|---|
| Share price | $209.00 | Closing price on October 12, 2026 |
| Market capitalization | Approximately $502 billion | Point-in-time equity value |
| Trailing P/E | 178.75 | Uses historical earnings |
| Forward P/E | 109.98 | Depends on forecast earnings estimates |
| Price-to-sales | 81.59 | Compares price with reported or estimated revenue, depending on the provider’s definition |
These are not intrinsic-value estimates or price targets. They move with the share price, reported earnings and analyst estimates. Date every multiple you quote and identify the data provider.
Interpret price-to-sales in context
A price-to-sales ratio of 81.59 means investors were paying roughly $81.59 of equity value for each dollar of the sales base used by the data provider. Sales alone do not determine shareholder returns: margins, taxes, capital needs, dilution and eventual growth all matter. At a high sales multiple, a slowdown can hurt twice—revenue compounds more slowly and the market may assign a lower multiple to that slower growth.
Interpret trailing and forward P/E
The 178.75 trailing P/E reflects the earnings already reported. The 109.98 forward P/E reflects estimates that may change as analysts revise revenue, margins, stock compensation and share counts. A lower forward than trailing multiple can indicate expected earnings growth, but it does not prove that the forecast is achievable. Ask what operating margin, tax rate, dilution and growth rate are embedded in the denominator.
Free tools Windows power users keep installed
One-click scans. No signup required.
Use peer comparisons carefully
If you compare Palantir with another software, data or defense-technology company, align the fiscal periods and accounting definitions first. Compare at least four axes:
- Price-to-sales against expected revenue growth and growth durability.
- Forward earnings multiple against the margin assumptions producing those earnings.
- Cash generation after considering stock-based compensation and dilution.
- Customer, sector, geographic and contract mix, including government exposure.
A peer multiple is not meaningful when one company reports a different fiscal period, uses a materially different adjusted definition or has a different mix of recurring subscriptions and project work. No independent analyst-consensus set or intrinsic valuation model is established here, so do not present one as verified evidence.
Map the principal risks to measurable indicators
Palantir’s own FY2025 Form 10-K says that investing in its Class A common stock involves a high degree of risk. The risk disclosure is broad; the useful task is to connect each risk to a number or filing section that can be monitored.
Growth durability and sales cycles
The company warns that it may not sustain its growth rate and that sales cycles can be long and unpredictable. Watch bookings, RPO conversion, new-customer additions, renewal timing and the gap between signed contracts and recognized revenue. A single large contract can lift a quarter without changing the underlying sales cadence.
Do these 3 things before closing this tab:
1Clear out junk files and repair common Windows errors2Fix the driver behind crashes, sound loss and screen glitches3Repair Windows errors before they cause bigger problemsCustomer concentration and deal realization
Concentration means that the loss, delay or downsizing of a major customer can affect results disproportionately. Review the revenue-concentration footnote and look for changes in the largest customer categories. The company also warns that it may fail to realize the full value of contracts; compare announced deal values with delivered deployments, expansions and recognized revenue.
Renewals, expansions and satisfaction
The Q2 filing identifies renewals, expansions, customer satisfaction, pricing, reliability and economic conditions as factors affecting customer relationships and revenue realization. A rising customer count cannot offset weak renewal economics indefinitely. Track dollar-based retention or equivalent expansion measures when disclosed, renewal rates, churn commentary and customer-support or reliability incidents.
Government and appropriation risk
Government options and programs can depend on appropriations and agency decisions. Separate funded, noncancelable work from options or potential extensions. Compare government and commercial growth rather than assuming one segment will automatically replace weakness in the other.
Competition and implementation risk
Palantir identifies competition and lengthy implementation as risks. Implementations that take longer than expected can delay revenue, increase service costs and postpone customer value. Look for changes in implementation timelines, professional-services spending, gross margin and references to competitive displacement.
The Tool Desk
Outbyte PC Repair FREEClear out junk files and repair common Windows errorsFree Scan →Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →Quarterly volatility and operating expenses
Quarterly results can fluctuate because of contract timing, renewals and government procurement. Evaluate trends over several quarters and compare operating-expense growth with revenue growth. A high adjusted margin in one quarter is less persuasive if GAAP expenses or stock compensation are rising faster over the same period.
Best Value
AI-related liability and reputation
The company warns that artificial-intelligence products can create liability or reputational harm. Monitor disclosures about model reliability, privacy, security, regulatory requirements, customer claims and product safeguards. These risks can affect legal costs and sales even before they appear as a large revenue change.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.A repeatable Palantir stock evaluation process
- Set the information date. Record the latest Form 10-Q or Form 10-K, earnings release and closing share price. Do not mix a current price with an old earnings denominator without labeling the mismatch.
- Build the growth table. Enter annual, quarterly and year-to-date revenue with the comparable prior periods. Add U.S. commercial, government and international growth when disclosed.
- Test growth quality. Compare customer additions with renewals, expansions, concentration and RPO conversion. Ask whether growth is broad or dependent on a few contracts.
- Reconcile margins. Show GAAP gross margin and operating income first. Add adjusted figures beside them and list stock-based compensation and employer payroll-tax exclusions.
- Account for dilution. Review stock-based compensation, diluted shares and per-share results. Do not treat adjusted profit as fully available to each existing share.
- Separate contract measures. Keep RPO, contract liabilities, bookings and management guidance in different lines. State recognition windows and cancelability.
- Translate the market price into assumptions. Record price-to-sales, trailing P/E and forward P/E with the date and provider. Then write down the growth, margin, tax and dilution assumptions required to justify them.
- Run downside checks. Model qualitatively what happens if growth slows, a major renewal is lost, implementation is delayed, government funding changes or the valuation multiple contracts.
- Refresh after every filing. Replace estimates with actual results, record guidance changes and update the share price. A valuation conclusion is never permanent.
How to frame bull, base and bear cases without false precision
Bull case
A constructive case requires more than repeating the latest 93% quarterly growth. It would require sustained commercial expansion, successful renewals, broad customer adoption, conversion of RPO into revenue, strong GAAP margins and stock compensation that does not outpace per-share growth. The valuation would still need to remain supported by those outcomes.
Base case
A neutral case assumes growth moderates from the latest exceptional comparisons while the company continues to add customers and maintain high margins. The key question becomes whether earnings and cash generation grow fast enough to support the multiple without relying on further multiple expansion.
PC Slower Than It Used to Be?
A free scan shows the junk files, broken settings and background clutter dragging Windows down - then fixes them in one click.Free scan · Windows 10 & 11Crashes, No Sound, or Screen Glitches?
Random freezes, missing sound and display glitches usually trace back to one bad driver. Find and replace yours safely.Free scan · under a minuteBear case
A downside case combines slower sales, delayed implementations, weaker renewals, government-budget pressure, higher competition or AI-related liabilities with a lower valuation multiple. Because the October 2026 multiples are high, a change in expectations can affect the stock even if revenue and profit continue to rise.
Common evaluation mistakes
- Annualizing Q2 revenue mechanically: one quarter contains timing effects and is not a four-quarter forecast.
- Using adjusted margin as the only margin: this hides the scale of stock-based compensation and related payroll taxes.
- Calling RPO guaranteed revenue: arrangements can be terminable and government options can depend on appropriations.
- Calling contract liabilities revenue: they are deferred revenue or deposits until performance occurs.
- Ignoring dilution because stock compensation is noncash: equity issuance can reduce each existing shareholder’s percentage claim.
- Treating old guidance as current: the 61% FY2026 guide was issued February 2, 2026 and must be compared with later guidance and actual results.
- Quoting an undated multiple: price-to-sales and P/E ratios are snapshots, not permanent company characteristics.
- Equating customer count with customer quality: retention, expansion, concentration and economics matter more than a simple total.
What to check in the next filing
On the next earnings release and Form 10-Q, update revenue for the quarter and year to date; segment growth by customer type and geography; customer count and retention or expansion measures; GAAP gross and operating margins; adjusted reconciliations; stock-based compensation; diluted shares; operating cash flow; RPO and its recognition schedule; contract liabilities; renewals and cancellations; and any changes to guidance. Recalculate the valuation multiples using the new price and the latest earnings denominator.
Also read the risk-factor updates rather than copying the prior quarter’s list. New language about government funding, customer concentration, implementation, competition, security or AI liability can be more informative than a small change in a headline growth rate.
Bottom line
Palantir’s reported numbers through Q2 2026 show extraordinary growth—$1.9 billion of quarterly revenue, up 93%, and $3.6 billion for the first half, up 89%—alongside very high gross and operating margins. The counterweights are equally concrete: $466.8 million of first-half stock-based compensation, a substantial gap between GAAP and adjusted operating margins, contract amounts that are not guaranteed revenue, and valuation multiples that were exceptionally high at the October 12, 2026 close. A disciplined conclusion therefore comes from updating the growth, GAAP profitability, dilution, contract conversion and risk evidence together, then asking whether the price still leaves room for execution errors.
Quick Recap
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
