Palantir Q2 2026 Earnings Rally On AI Demand
Palantir Q2 2026 earnings showed surging U.S. commercial revenue and wider margins; the company raised FY revenue guidance and boosted positioning.
KEY TAKEAWAYS
- Reported Q2 revenue of $1.9 billion, up 93.0% year-over-year and 19.0% quarter-over-quarter.
- U.S. commercial revenue hit $764 million, rising 149.0% year-over-year and 28.0% sequentially.
- Raised FY 2026 revenue guidance to about $8.2 billion and signaled stronger cash generation.
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Palantir Technologies Inc. (PLTR) reported Q2 2026 revenue of $1.935 billion, up 93% year over year, driven by accelerating U.S. commercial demand and wider margins. The company raised its full-year revenue guidance and strengthened its cash-generation outlook, according to a press release on Aug. 4, 2026.
Q2 Financial Results
Palantir’s Q2 revenue rose 19% sequentially, reflecting a sharp acceleration in top-line growth. U.S. commercial revenue reached $764 million, up 149% year over year and 28% quarter over quarter, highlighting a shift toward enterprise customers. U.S. government sales totaled $809 million, increasing 90% year over year and 18% sequentially. Combined U.S. revenue grew 115% year over year to $1.573 billion.
The company reported an adjusted operating margin of 62% and a GAAP operating margin of 47%. GAAP net income rose 225% year over year to $1.062 billion, with a 55% net margin, reflecting rapid revenue growth and operating leverage.
Adjusted free cash flow was $1.22 billion, with a 63% margin. Palantir ended the quarter with $9.2 billion in cash, providing flexibility to invest in product development and go-to-market initiatives.
During the quarter, Palantir closed $3.37 billion in total contract value and secured 220 deals worth $1 million or more. Net dollar retention stood at 157%, and the Rule of 40—a combined measure of growth and profitability—was 155%, indicating strong expansion within existing accounts alongside new bookings.
Guidance and Customer Trends
Palantir raised its full-year 2026 revenue guidance to a range of $8.15 billion to $8.158 billion. It set U.S. commercial revenue guidance at a minimum of $3.424 billion, signaling continued acceleration in that segment. The company also forecast an adjusted operating margin near 60% and adjusted free cash flow between $4.5 billion and $4.7 billion for the year.
Management attributed the quarter’s strength to demand for AI sovereignty—the ability for organizations to control their own artificial intelligence deployments—and growing enterprise and government adoption of its AI platform. CEO Alex Karp described the quarter as “otherworldly,” reflecting high retention rates and large contracts that suggest customers are expanding their use of Palantir’s sovereign AI solutions.
