The current situation is indeed very interesting. I previously listened to ServiceNow’s earnings call, where the CEO, performing in his characteristically flamboyant style, reassured and repeated how NOW’s AI-enhanced software improves efficiency, etc., etc. You hear the same from other enterprise software companies. Karp, however, is a different breed. In his speeches, he moves on a philosophical, high-level plane, which confuses the listener.
Like Karp, his company Palantir seems to be cut from a different cloth. It is enterprise software, but with a different philosophy. AIP and the company’s other software solutions have been designed to fundamentally penetrate corporate workflows, automating and intellectualizing them. Ontology—the understanding of the basic properties and functions of things—is at the core of Palantir.
This is my perception, and I still know the company too poorly, but my understanding is gradually increasing. As a software layman, holding is easier because I am unable to over-analyze this company.
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Another image illustrating Palantir’s unique characteristics is shown above. Alex Karp already stated in the Q4 2025 investor call that the company’s headcount will remain at its current level, even though he promised a 10X revenue increase in the US by 2030. Palantir knows how to utilize AI effectively in its own product development and service delivery. This is evidenced by the company quadrupling its GAAP net income in one year while increasing its staff by only 10%. The headcount is expected to stabilize at the 4,400 level.
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Palantir generated more free cash flow in Q1/2026 than the entire company’s revenue was a year earlier: cash flow was $925M vs. Q1/2025 revenue of $884M. I won’t list the full report content and all key metrics here, but let it be noted that once again, all previous records were crushed. A Rule of 40 score of 145 sounds like some kind of GTA full cheat code.
My view: the massive stock price surge in 2023–2025 also requires a massive consolidation / multiple-digestion phase, and that is 2026. If the share price stays roughly at current levels this year, valuation multiples will melt down tremendously.
TTM P/E is a poor metric for assessing the expensiveness of a growth company, but the same metric is interesting when looking in the rearview mirror, as it provides perspective on the freezing speed at which earnings are growing. Due to this latest result and the subsequent day’s share price drop, the TTM P/E was cut like butter with a hot katana: 232 → 152.
Extreme valuation has been met with even more extreme fundamentals.
Why this is significant is that we are not talking about a startup, but a scale where they are already doing over $6.5B in revenue at the current run-rate, growth is accelerating, and there is no sign of it slowing down.
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Michael Lee Strategy released a Palantir episode (X-link below). Michael Lee is an investor and asset manager, best known for his firm Michael Lee Strategy (founded in 2019). There are some Trump-related comments by Michael Lee at the beginning of the video, but you can skip past them if they bother you.
I’m sharing this episode here because it features Palantir OG Adam Gokarp. During the last earnings call, Karp promised 100% growth by 2027. Gokarp is able to explain where this growth will come from. $2.7 billion budgeted for Maven, perhaps 10% of $1 billion for Palantir in GoldenDome, while RedCat, L3Harris, Anduril, Northrop, and Palantir develop autonomous systems, and Palantir’s Warp Speed streamlines industrial production, etc. etc.
I shared this so that if you, dear readers, wonder four years from now how the approximately $8 billion revenue of 2026 became $40 billion in 2030, Gokarp describes the pieces of that growth story in this episode. Gokarp focuses on the public sector, but as is well known, Palantir also succeeds in the private sector. This is not investment advice, but on the other hand, it is good to be aware of this scenario, as it is not a pipe dream; the foundation of this growth is a strong and very concrete Palantir growth story based on evidence and achievements to become the primary AI operating system for federal operations.
Palantir Earnings Recap / X
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