Palantir Technologies (NYSE: PLTR) stock surged 12.2% in Monday's after-hours trading following the software-as-a-service (SaaS) company's release of its second-quarter 2024 results.
Investors' delight is attributable to the quarter's revenue and earnings both beating Wall Street's expectations, third-quarter revenue guidance also coming in ahead of the analyst consensus estimate, and management increasing its full-year 2024 outlook for revenue and a couple of other metrics.
Investors were also likely pleased that Palantir continues to grow its commercial business at a rapid pace. The company was originally focused on governmental agencies, so its heavy dependence on government spending made some investors uneasy.
Palantir Technologies' key numbers
Metric | Q2 2023 | Q2 2024 | Change* |
|---|---|---|---|
Revenue | $533 million | $678 million | 27% |
GAAP operating income | $10 million | $105 million | 950% |
Adjusted operating income | $135 million | $254 million | 88% |
GAAP net income | $28 million | $134 million | 379% |
Adjusted net income | $120 million | $221 million | 84% |
GAAP earnings per share (EPS) | $0.01 | $0.06 | 500% |
Adjusted EPS | $0.05 | $0.09 | 80% |
Data source: Palantir Technologies. GAAP = generally accepted accounting principles. Calculations by author except for revenue and adjusted EPS growth, which were provided by Palantir.
Investors should focus on the adjusted numbers because they exclude one-time items.
Wall Street was looking for adjusted EPS of $0.08 on revenue of $652.1 million, so Palantir beat both expectations. It also easily exceeded its own revenue guidance, which was for $649 million to $653 million.
Palantir generated cash of $144 million running its operations during the quarter, up 60% from the year-ago period. Its adjusted free cash flow was $149 million, up 55% year over year. The company ended the quarter with cash, cash equivalents, and short-term investments of $4.0 billion. It has no long-term debt.
What happened with Palantir in the quarter?
(All percentage growth figures are year over year.)
Commercial revenue grew 33% to $307 million, accounting for 45% of total revenue.
Government revenue grew 23% to $371 million, or 55% of total revenue.
U.S. commercial revenue jumped 55% to $159 million.
U.S. commercial customer count surged 83%.
U.S. commercial remaining deal value soared 103%.
U.S. government revenue grew 24%.
The company closed 27 deals over $10 million.
Customer count increased 41%.