Palantir Technologies anticipates 2024 earnings that exceed Wall Street expectations and reported its “first profitable year,” citing strong demand for its AI solutions.
Palantir Technologies (PLTR.N) forecasts 2024 earnings beyond Wall Street predictions and reported its “first profitable year” on Tuesday on high demand for its AI solutions, driving the data analytics company’s stock up more than 19% in extended trading.
Enterprises are prioritizing AI adoption, which is increasing demand for Palantir’s goods, particularly its artificial intelligence program, which CEO Alex Karp describes as the company’s “future.”.
Palantir’s stock increased nearly threefold in 2023 due to an AI boost, outperforming the tech-heavy Nasdaq 100 (.NDX) by 53.8%.
The company signed 103 deals worth over $1 million each in the fourth quarter ended December 31, according to Chief Revenue Officer Ryan Taylor.
Commercial revenue in the United States increased by 70% to $131 million, up from 12% the previous year. Total commercial revenue of $284 million exceeded LSEG expectations.
Commercial growth implies “a growing mix of commercial versus government going forward, especially given the guidance,” according to RBC Capital Markets analyst Rishi Jaluria.
Palantir forecasts commercial revenue in the United States to grow by at least 40% in 2024, up from 36% in 2023.
Growth in its staple government business, which accounted for more than half of overall fourth-quarter sales, has continued to decrease. Government revenue increased by 11%, compared to 23% the previous year.
“Some of this weakness stems from the ongoing resolution and timing of significant potential contract awards. However, it is also a result of the department’s rate of scaling its AI and software activities,” Taylor explained.
Analysts have raised concerns about the recognition of revenue from government partnerships, citing the fact that it is likely to appear inconsistently in the company’s books.
The company expects adjusted 2024 earnings to be between $834 million and $850 million, which is more than expected, while revenue will be in line with expectations.
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