Wall Street expects explosive growth, but scrutiny around pricing and government reliance remains intense
Palantir Technologies (PLTR) is set to report fourth-quarter earnings after the market close on Monday, with Wall Street anticipating another quarter of outsized growth from the artificial intelligence software firm. Analyst estimates tracked by Bloomberg project earnings per share of $0.23, sharply higher than $0.14 a year ago, while revenue is expected to surge more than 60% year over year to approximately $1.3 billion.
A key driver of this growth continues to be Palantir’s U.S. commercial segment. Revenue from U.S. business customers is projected to jump nearly 124% from the prior year to $479 million, underscoring accelerating enterprise adoption of Palantir’s AI-driven platforms. This rapid expansion highlights the company’s success in translating its government-honed technology into scalable commercial solutions.
Despite that momentum, Palantir’s U.S. government business remains its largest single revenue contributor. Analysts expect government contracts to account for roughly 40% of total revenue, with U.S. government sales forecast to reach $522 million in the quarter—up nearly 52% from 2024. Continued support from federal agencies has reinforced Palantir’s position as a critical data and analytics provider within public sector operations.
Investor sentiment, however, has been volatile. Although Palantir beat expectations in the third quarter, its stock sold off as concerns mounted over valuation and a broader pullback in software equities. Shares are down more than 10% over the past month, mirroring weakness across AI-linked names in the S&P 500.
On Monday, William Blair analyst Louie DiPalma upgraded the stock to Outperform, arguing that the recent sell-off has made Palantir’s still “frothy” valuation more reasonable relative to peers. He also noted that strong government engagement could fuel a “very strong December quarter.”
According to Bloomberg data, Palantir shares are expected to move about 9% following the earnings release, setting the stage for a pivotal moment as growth optimism meets valuation reality.
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