Executive Summary
Palantir Technologies Inc (NYSE: PLTR) reported a robust Q1 2024, concluding with a revenue increase of 21% year-over-year to $634 million. This strong growth was propelled primarily by the adoption of its Artificial Intelligence Platform (AIP) and a notable upswing in the U.S. commercial sector. The company demonstrated continued profitability, marking its sixth consecutive quarter of net income, amounting to $106 million, representing significant year-over-year growth of 528%. Management emphasized their commitment to expanding customer engagements and derived value from AI technologies, positioning Palantir favorably against growing competitive pressures in the technology and defense sectors. Furthermore, strategic investments in technology infrastructure and customer relationships are expected to enhance operational scalability and revenue expansion moving forward.
Key Performance Indicators
QoQ: 22.93% | YoY:1 865.52%
QoQ: 13.00% | YoY:528.08%
QoQ: 11.71% | YoY:496.25%
Key Insights
**Revenue:** $634 million, up 21% YoY, 4% QoQ.
**Gross Profit:** $518 million, with a margin of 81.7%.
**Operating Income:** $81 million, representing a 12.8% margin, and growth of 1865% YoY.
**Net Income:** $106 million, up 528% YoY.
**Earnings Per Share (EPS):** $0.04 diluted, a substantial increase compared to $0.01 in Q1 2023.
**Total Customer Count:** 554, reflecting a 42% increase YoY.
**U.S. Commercial Revenue:** Increased 40% YoY to $150 million, fueled by the traction of AIP...
Financial Highlights
Revenue: $634 million, up 21% YoY, 4% QoQ.
Gross Profit: $518 million, with a margin of 81.7%.
Operating Income: $81 million, representing a 12.8% margin, and growth of 1865% YoY.
Net Income: $106 million, up 528% YoY.
Earnings Per Share (EPS): $0.04 diluted, a substantial increase compared to $0.01 in Q1 2023.
Total Customer Count: 554, reflecting a 42% increase YoY.
U.S. Commercial Revenue: Increased 40% YoY to $150 million, fueled by the traction of AIP.
Cash and Short-Term Investments: $3.4 billion, indicating a strong liquidity position to support further growth.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
634.34M |
20.78% |
4.27% |
| Gross Profit |
518.08M |
24.08% |
3.68% |
| Operating Income |
80.88M |
1 865.52% |
22.93% |
| Net Income |
105.53M |
528.08% |
13.00% |
| EPS |
0.05 |
496.25% |
11.71% |
Key Financial Ratios
operatingProfitMargin
12.8%
operatingCashFlowPerShare
$0.06
freeCashFlowPerShare
$0.06
priceEarningsRatio
119.88
Management Commentary
1. Artificial Intelligence Focus: Ryan Taylor stated, "The continued interest in AIP is loud and clear in the conversations...our results show that our strategy is not only succeeding, it is accelerating."
2. Customer Expansion: Noting substantial demand, Taylor highlighted that customer engagement has led to significant expansions, showcasing cases like Lowe’s and Cleveland Clinic increasing their scope of work.
3. Government Contracts: According to Taylor, "Last quarter, we were honored the U.S. Army awarded Palantir over $178 million... This exemplifies Palantir's position as the software prime."
4. Market Momentum: CEO Alexander Karp emphasized, "You see it in the general enthusiasm around our products... we believe we are the only company in America that will allow you to do useful things with large language models."
"We started the year exceedingly strong with revenue of $634 million, an increase of 21% year-over-year driven by the momentum of AIP..."
— Ryan Taylor
"You see it in our Rule of 40 being 57...We're doing the impossible. We are growing the company while investing in our core IP or software development."
— Alexander Karp
Forward Guidance
Management provided optimistic projections for Q2 2024, anticipating revenues between $649 million and $653 million, and adjusted operating income of approximately $210 million. For the full year, guidance has been raised to between $2.677 billion and $2.689 billion, signifying robust growth expectations, particularly in the U.S. commercial segment, with targets set over $661 million. The emphasis on AI deployment and expansion capabilities are key areas to watch as these developments may further drive growth and profitability.