Palantir Earnings Beat on U.S. AI Momentum

Palantir Technologies reported earnings on Feb. 6, 2026, that exceeded forecasts as U.S. commercial demand for its AI platforms drove strong growth and prompted higher full-year revenue guidance while margins and cash flow expanded.

Quarter and Annual Results

Palantir released its Q4 2025 results in a press release, investor presentation, and shareholder letter on Feb. 6, 2026, followed by an earnings call.

The company reported Q4 revenue of $1.407 billion, up 70% year-over-year and 19% sequentially, surpassing the consensus estimate of $1.32 billion. Adjusted operating income reached $798 million, representing a 57% margin. Adjusted earnings per share were $0.25, above the $0.23 consensus, with GAAP EPS at $0.24.

For the full year, revenue totaled $4.475 billion, a 56% increase from 2024. Palantir closed FY2025 with adjusted operating income of $2.3 billion, a 50% margin, and adjusted free cash flow of $2.3 billion, a 51% margin. The company’s Rule of 40 score—a measure combining growth and profitability—was 127% in Q4 and 106% for the full year.

Guidance and U.S. Commercial Momentum

The investor presentation highlighted U.S. commercial acceleration. Q4 U.S. commercial revenue reached $507 million, up 137% year-over-year and 28% sequentially. For FY2025, U.S. commercial revenue totaled $1.465 billion, a 109% increase. The number of U.S. commercial customers rose 49% to 571.

Total U.S. revenue in Q4 was $1.076 billion, up 93% year-over-year and 22% sequentially. Government revenue for the quarter grew 60% to $730 million.

Bookings strengthened the pipeline, with Q4 total contract value (TCV) bookings at $4.3 billion, up 138% year-over-year. Total remaining deal value climbed 105% to $11.2 billion.

Management set Q1 2026 revenue guidance between $1.532 billion and $1.536 billion, with adjusted operating income guidance of $870 million to $874 million. For FY2026, revenue is projected between $7.182 billion and $7.198 billion, implying 61% growth. U.S. commercial revenue is expected to exceed $3.144 billion, at least 115% growth. Adjusted operating income guidance ranges from $4.126 billion to $4.142 billion, and adjusted free cash flow guidance is $3.925 billion to $4.125 billion. The projected Rule of 40 is 118%.

The company attributed this outlook to continued demand for its AI platform, a U.S.-focused commercial strategy, investments in AI and talent, and sustained GAAP profitability. CEO Alex Karp said, "These numbers are extraordinary because they're fully organic." Management said the U.S. commercial surge supports confident multi-year targets despite mixed investor sentiment amid recent share declines tied to valuation concerns.