Palantir’s revenue was impressive and raised its financial forecast, but it fell short of the market’s high expectations and its share price fell after the market closed.

artificial intelligence (AI) powered data and analytics platform Palantir’s revenue exceeded US$2 billion for the first time last quarter. Its revenue forecast for the quarter also exceeded analysts’ expectations. It also raised its full-year financial forecast. However, the quarter-on-quarter growth rate of revenue this quarter may slow, which will fail to meet the market’s high expectations. The share price fell more than 2% after the market closed.

Palantir’s third-quarter revenue increased by 96% from the same period last year to US$2.31 billion, exceeding US$2 billion for the first time in history, and earnings per share were US$0.44, both better thanwall Street Forecast. Adjusted free cash flow was US$1.216 billion, up significantly from US$540 million a year earlier.

In addition, Palantir’s US commercial revenue last quarter was US$984 million, which for the first time in history it surpassed US government revenue of US$953 million, reflecting impressive sales of enterprise AI software. The company’s revenue from the US government was almost double its commercial revenue two years ago.

Palantir CEO Alex Karp described the company’s performance as “bombshell” growth. “The major part of our business now is American commerce.” He highlighted that the company’s US commerce revenues grew 148% year-over-year while maintaining a stable workforce. “What you see now is a new world… the situation cannot be the same as before.”

Chief Revenue Officer Ryan Taylor said Palantir’s goal is to “deploy the right model for the right purpose…while protecting the privacy and security that truly sets an organization apart.”

Palantir expects revenue for the quarter to be between $2.649 billion and $2.653 billion, above market estimates, and raised the range of its full-year revenue forecast to $8.534 billion from $8.534 billion. US trade revenues will exceed US$3.559 billion, representing an increase of at least 143%.

However, Palantir’s financial forecast for this quarter implies that this quarter’s revenue will grow by about 15% compared to last quarter, which is significantly lower than last quarter’s 20% quarter-on-quarter growth rate, and may also be the slowest quarter-on-quarter growth since the second quarter of last year.

Analysts also reported that US trade agreements finalized by Palantir in the third quarter amounted to US$1.46 billion, an increase of 11% year-on-year, significantly lower than the 153% increase in the second quarter, and the smallest increase since 2023, suggesting that competitive pressure from cutting-edge model suppliers such as Anthropic has intensified, and the growing computing needs of Palantir customers are still a are the recent hurdles.

Ryan Lee, senior vice president of product and strategy at Direxion, pointed out that Palantir’s share price reflected an “ideal” situation before the financial report was released, so even though the financial report was better than expected, the share price still declined.

Palantir is still optimistic about the prospects. “I’m more excited than ever about the ambition and demands of sovereign AI from customers. Don’t forget, this revolution has only started in less than a quarter of a century,” Taylor said. Although Palantir’s share price has fallen 16% from its October high, it is still up 45% this year.