Palantir CEO Calls Earnings Beat a ‘Cosmic Reward’ for Loyalty to ‘Idiosyncratic Project’

Few companies are more polarizing than Palantir. Shares in the retail investor favorite are up nearly 80% in the past 12 months, despite tumbling almost 30% from their November high, reflecting a market-churning mix of rabid enthusiasm and circumspection for a stock with a valuation of the nosebleed variety. 

On Monday, the software firm charted a glorious 2026 for the believers. After reporting a 70% year-over-year increase in fourth-quarter revenue to $1.4 billion — which beat analysts’ $1.3 billion estimate — executives said they expect revenue to grow 61% this year to $7.18 billion or more. CEO Alex Karp told analysts on an earnings call that it was ​​“one of the truly iconic performances in the history of corporate performance.”

Going All In

Palantir’s recent tumble is partly attributable to a broader selloff in traditional enterprise software firms, triggered by fears that AI’s coding capabilities could displace them. But it also faces the simple concern that it’s overvalued. Palantir’s price-to-book ratio of more than 50 dwarfs peers like Broadcom (19.3), Oracle (15.8) and Adobe (10.4). “We cannot rationalize why Palantir is the most expensive name in our software coverage,” wrote RBC analysts, who affirmed the bank’s underperform rating and a $50 price target on the stock last week, implying it could fall nearly 65% from its $147.76 Monday close. They worry Palantir’s revenue from government contracts and the resilience of its commercial enterprise customer base could come under pressure and flagged “rising concerns around privacy and ethics” such as its work for Immigration and Customs Enforcement (ICE).

RBC is a stark outlier. The average analyst price target for Palantir is $201.52, according to Zacks Investment Research. Analysts at William Blair, for example, upgraded the stock to “outperform” before Monday’s earnings. Its “frothy” valuation, the firm’s analysts wrote, has become “more reasonable relative to recent venture rounds for companies tied to the AI ecosystem.” The Trump administration, they added, “continues to go all in with Palantir,” which bodes well for big projects like a $448 million deal with the Navy to develop software to make shipbuilding and fleet maintenance more efficient through improved data use. William Blair noted similar deals with other branches of the armed forces could arise if all goes well. In a valedictory letter to shareholders, Karp touched on much of the buzz:

• He called the fourth quarter earnings a “cosmic reward of sorts” for shareholders who have stuck with the company. Karp added that US revenue, which “sits at the core” of Palantir, rose 93% in the fourth quarter of 2025 to $1.1 billion.
• Of AI, he argued that large language models “are little without a software architecture” and that Palantir is focused on creating value for clients with software that puts models’ output to use. 

No Guarantee in Life or Markets: Palantir shares fell nearly 8% the last time it reported a strong quarter, as questions about its lofty valuation seemed to outweigh performance. That wasn’t the reaction on Monday: The stock jumped over 5% in after-hours trading.