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    PLTR
    Earnings call· Mar 2026(Q1 FY26)

    Palantir Technologies Q1 FY26 earnings call PLTR

    May 4, 2026 Source

    Executive summary

    Palantir Technologies Inc. Q1 FY26 — Record Revenue Growth and AI Platform Dominance

    Palantir delivered a record-breaking quarter, driven by exceptional demand for its AI platform (AIP), particularly in the U.S. market where revenue grew over 100%. The company emphasizes its unique positioning against 'AI slop' by providing a battle-tested platform for operational AI, enabling customers to achieve tangible results and redefine their industries. Management remains focused on investing in product development and talent while maintaining strong profitability and cash flow generation.

    Highlights

    5

    • Total revenue grew 85% year-over-year to $1.633 billion, marking the highest overall revenue growth rate as a public company.

    • U.S. business revenue surpassed 100% year-over-year growth for the first time, reaching 104% year-over-year and $1.282 billion.

    • U.S. commercial revenue grew 133% year-over-year to $595 million, demonstrating exceptional momentum.

    • Rule of 40 score climbed to 145%, an 18-point increase from the prior quarter, highlighting strong combined growth and profitability.

    • Adjusted free cash flow reached $925 million, representing a 57% margin, with $8 billion in cash and equivalents.

    Concerns

    3

    • Adjusted expense increased 32% year-over-year to $649 million, driven by continued investment in AI platform and technical hiring.

    • Revenue from strategic commercial contracts is expected to decline to less than $0.5 million in each remaining quarter of the year.

    • The company acknowledges the historical pattern of extended continuing resolutions (CR) in government, which could impact future growth.

    Guidance & targets

    8
    CategoryTargetConfidence
    Q2 2026 Revenue
    $1.797 billion to $1.801 billion
    high materiality
    High
    Q2 2026 Adjusted Income from Operations
    $1.063 billion to $1.067 billion
    high materiality
    High
    Full Year 2026 Revenue
    $7.650 billion to $7.662 billion
    high materiality
    High
    Full Year 2026 U.S. Commercial Revenue
    in excess of $3.224 billion
    high materiality
    High
    Full Year 2026 Adjusted Income from Operations
    $4.440 billion to $4.452 billion
    high materiality
    High
    Full Year 2026 Adjusted Free Cash Flow
    $4.2 billion to $4.4 billion
    high materiality
    High
    Full Year 2026 GAAP Operating Income and Net Income
    expected in each quarter
    medium materiality
    High
    Full Year 2026 Rule of 40 Score
    129%
    high materiality
    High

    Segment performance

    9
    SegmentRevenueYoYQoQMargin
    Total Company
    Highest overall revenue growth rate as a public company.
    		$1.633B85%16%—
    U.S. Business
    First time achieving triple-digit growth since DPO.
    		$1.282B104%19%—
    Commercial
    Strong growth driven by AI platform dominance in U.S. markets.
    		$774M95%14%—
    U.S. Commercial
    Exceptional growth, would have been 143% YoY and 22% QoQ absent a customer transition to U.S. government.
    		$595M133%18%—
    International Commercial
    Steady growth in international markets.
    		$179M26%5%—
    Strategic Commercial Contracts
    Represented 0.2% of overall revenue, expected to be less than $0.5M in remaining quarters of FY26.
    		$3M———
    Government
    Growth driven by continued execution in existing programs and new awards.
    		$858M76%18%—
    U.S. Government
    Strong growth reflecting growing demand for AI platform in government.
    		$687M84%21%—
    International Government
    Solid growth in international government sector.
    		$172M51%7%—

    Operational metrics

    13
    Adjusted Gross Margin
    88%
    Q1 FY26

    Excludes stock-based compensation expense.

    Adjusted Income from Operations
    $984M
    Q1 FY26

    Represents adjusted operating margin of 60%.

    Adjusted Expense
    $649Mup 7% sequentially, 32% year-over-year
    Q1 FY26

    Primarily driven by continued investment in AI platform and technical hiring.

    GAAP Net Income
    $871M
    Q1 FY26

    Representing a 53% margin.

    GAAP Earnings Per Share
    $0.34
    Q1 FY26

    Diluted.

    Adjusted Earnings Per Share
    $0.33
    Q1 FY26

    Diluted.

    Cash, Cash Equivalents and Short-term U.S. Treasury Securities
    $8B
    Q1 FY26

    Balance at quarter end.

    Stock-based Compensation Expense
    $202M
    Q1 FY26

    For the first quarter.

    Equity-related Employer Payroll Tax Expense
    $28M
    Q1 FY26

    For the first quarter.

    ShipOS Bill of Materials Approval Time Reduction
    15 secondsfrom 200 hours
    Q1 FY26

    Impact at several manufacturing industrial-based suppliers.

    ShipOS Contract Review Cycles Speed Increase
    57% to 73%
    Q1 FY26

    Impact at several manufacturing industrial-based suppliers.

    ShipOS Monthly Material Planning Time Reduction
    94%
    Q1 FY26

    Impact at several manufacturing industrial-based suppliers.

    USDA Contract Value
    up to $300M
    last month

    Contract to provide USDA with capabilities to support American farmers, secure farmland, enhance supply chain resilience and shield agricultural programs from fraud, abuse and foreign adversary influence.

    Industry KPIs

    8
    MetricValueDetails
    Revenue growth$1.633BUSD
    Rpo current rpo$4.5BUSD
    Bookings billings$1.3BUSD
    Customer account count1,007customers
    Large customer cohorts$108MUSD
    Operating FCF margin rule of 40145%%
    Ai product adoption monetizationdoubled
    Net revenue net dollar retention150%%

    Orderbook & backlog

    7
    Commercial TCV bookings$1.3BQ1 FY26

    42% growth year-over-year

    U.S. Commercial TCV bookings$1.2BQ1 FY26

    45% growth year-over-year

    Third consecutive quarter of over $1 billion in U.S. commercial TCV bookings.

    U.S. Commercial TCV bookings (LTM)$4.7BQ1 FY26

    115% increase from prior 12 months

    Highlighting accelerating demand for AI that creates real operational value.

    Total Remaining Deal Value$11.8BQ1 FY26

    98% increase year-over-year, 6% sequentially

    U.S. Commercial Remaining Deal ValueincreasedQ1 FY26

    112% year-over-year, 12% sequentially

    Government TCV bookings$2.4BQ1 FY26

    61% growth year-over-year

    On a dollar-weighted duration basis, TCV bookings grew 135% year-over-year.

    Remaining Performance Obligations (RPO)$4.5BQ1 FY26

    134% increase year-over-year, 9% sequentially

    Primarily comprised of commercial business; does not include contracts with initial term less than 12 months or obligations beyond termination for convenience clauses common in government business.

    Product announcements

    2
    ProductTypeDetails
    Agent Engine SDKlaunch
    Next Generation of Apolloupdate

    Deals & partnerships

    3
    GE Aerospacepartnership

    Deepened partnership to deploy Agentic AI-powered solutions across their production system and military aviation supply chain, with a shared mission of ensuring more aircraft remain available for U.S. Air Force pilots.

    Ondas and World Viewpartnership

    Expanded work with Palantir to bring AIP to the stratosphere and build the operational backbone required to scale their missions, enabling dozens or 100 simultaneous launches with the same operational efficiency.

    USDAcustomer contractup to $300M

    Awarded a contract to provide USDA with capabilities to support American farmers, secure farmland, enhance supply chain resilience, and shield agricultural programs from fraud, abuse, and foreign adversary influence.

    Risks & headwinds

    4
    Rising operating expensesQ1 FY26

    Adjusted expense up 32% year-over-year to $649 million

    Mitigation: Continued investment in AI platform and technical hiring, with commitment to sustained GAAP profitability.

    Potential for extended continuing resolution (CR)FY26

    History suggests CRs are common in election years

    Mitigation: Management is confident in the existential role Palantir plays in moving the department forward and expects to realize value regardless.

    Talent competitionOngoing

    Super competitive environment for engineers

    Mitigation: Palantir attracts and retains top talent by offering a unique, high-impact work environment and focusing on neurodivergent individuals.

    Market perception of 'AI slop'Ongoing

    Risk of customers being misled by 'appearances of software working' vs. actual results

    Mitigation: Palantir differentiates itself by delivering proven, battle-tested operational AI through its AIP and Ontology, which provides precision and governance.

    Q&A highlights

    5

    How does Palantir navigate an environment where AI is pressuring software?

    Palantir is counter-positioned against legacy software and 'AI slop' by focusing on enterprise autonomy and the Ontology as a 'no slop zone' that delivers real outcomes, not just demos. This approach makes AI a massive tailwind for the company.

    “We, on the other hand, have been focused entirely on building software that's focused on alpha and not beta. We're not trying to make you the same as every other person. We're trying to figure out what makes you different, how do we express your business strategy through the software platforms and products we build.”

    asked by Aidan (Shareholder) · answered by Shyam Sankar

    2 min read5 chapters

    Detailed Narrative

    01

    AIP Dominance and 'No Slop Zone'

    Palantir's AI Platform (AIP) is highlighted as the only solution capable of converting AI leverage into real-world value without risking enterprise disaster, establishing a 'no slop zone.' The platform enables multi-agentic solutions, as seen with AIG deploying AIP for underwriting and claims, and is critical for operational AI in production at scale. This unique capability allows companies to redefine how they compete within their industries, moving beyond mere cost-cutting.

    02

    U.S. Business Acceleration and Demand

    The U.S. business achieved triple-digit growth for the first time, with revenue growing 104% year-over-year and 19% sequentially. This acceleration was driven by surging demand for AIP, particularly in the U.S. commercial sector, which saw 133% year-over-year growth. Management noted that demand in the U.S. currently outstrips supply, indicating significant market opportunity and the company's unique position in delivering tangible AI results.

    03

    Jevon's Paradox and Token Economics

    The company observes 'Jevon's paradox' in AI, where the precipitous drop in token costs (GPT-4 equivalent performance is 1,000x cheaper) leads to an explosion in use case demand. While cheaper inference allows more tasks, it also increases 'slop' and the need for a system like AIP to prevent economic harm. The Ontology acts as the 'body to the AI brains,' providing the necessary harness for governance, attribution, and audibility of agent actions, making it indispensable for enterprise AI.

    04

    Government and Defense Impact

    Palantir's platforms are critical for the U.S. government and defense. Maven usage has doubled in the past four months and quadrupled over the past year, supporting warfighters. ShipOS, in partnership with the Department of the Navy, has dramatically improved manufacturing processes, reducing bill of materials approval time from 200 hours to 15 seconds. AIP is becoming the default builder platform in the Department of War, with thousands of developers using AIFD to modernize American manufacturing and solve complex problems.

    05

    Talent Strategy and Market Counter-Positioning

    Palantir maintains its reputation for attracting top talent, including 'neurodivergent' individuals, despite a competitive environment. The company positions itself against 'legacy thin software' and 'AI slop,' arguing that its focus on 'alpha' (unique business strategy) and enterprise autonomy delivers actual results. Management believes that while competitors offer 'beautiful shiny appearances,' Palantir transforms enterprises, leading to sustained growth and profitability.

    AI-generated summary of the company’s earnings call. Not investment advice.