Palantir Technologies reported robust third-quarter results, surpassing $2 billion in revenue for the first time and seeing US commercial sales exceed government revenue for the first time in company history, driving a rise in share price.
- Q3 revenue hits $2.313 billion, up 96% year-over-year
- US commercial sales grow 148%, surpass government revenue
- Full-year revenue guidance raised to $8.53 billion
What happened
Palantir Technologies posted adjusted earnings per share of 44 cents for the third quarter ending September 30, nearly doubling from 21 cents a year earlier. Total revenue reached $2.313 billion, representing a 96% increase compared to the same quarter in 2025. This marked the company's first quarter with revenue exceeding the $2 billion threshold. The company also recorded a significant milestone as US commercial revenue reached $984 million, overtaking US government revenue of $953 million for the first time.
The total US revenue amounted to $1.937 billion, up 119% year-over-year. Palantir closed 212 deals worth at least $1 million during the quarter, including 64 deals exceeding $10 million each. Contract values showed continued growth, with total contract value increasing 6% year-over-year to $2.918 billion and remaining deal value for US commercial contracts rising 79% to $6.517 billion.
Why it matters
The strong commercial revenue growth signals a notable shift in Palantir’s customer mix, traditionally dominated by government contracts. Surpassing government sales indicates broader adoption in the private sector, which could drive more sustained long-term growth and diversify Palantir’s revenue sources.
Financial performance was robust, with net income more than doubling to $1.128 billion, yielding a 49% net margin. Adjusted operating income reached $1.427 billion at a 62% margin, while adjusted free cash flow was $1.216 billion. Palantir’s 'Rule of 40' score—a performance metric combining growth and profitability—hit an impressive 158%, underscoring strong operating leverage.
What to watch next
Looking ahead to Q4, Palantir expects revenue between $2.649 billion and $2.653 billion, well above analyst forecasts of $2.46 billion. The company raised its full-year revenue guidance for 2026 to a range of $8.530 billion to $8.534 billion, reflecting continued confidence in its growth trajectory, especially in the US commercial segment which is projected to exceed $3.559 billion this year.
CEO Alex Karp highlighted the emerging 'Sovereign AI movement,' describing it as a fundamental division between leading and lagging organizations and positioning Palantir as well-suited to benefit from this transformation. Investors and market watchers will closely monitor Palantir’s ability to sustain commercial momentum and capitalize on AI-driven opportunities in both government and private sectors.