Palantir (PLTR) shares jumped 12% after the bell as revenue rose 93% year on year to $1.94bn, comfortably ahead of the $1.81bn analysts had pencilled in.
The number driving that reaction was US commercial revenue, which surged 149% to $764m, prompting the company to raise full-year guidance to $8.15bn-$8.16bn, up from a prior forecast implying roughly 71% growth to one now implying 82%.
Whether that growth rate deserves today’s price tag is a separate question from whether the quarter itself was strong, since the shares had already shed close to 30% of their value in 2026 as investors grew wary of paying up for AI-driven expansion that still had to be proven quarter by quarter.
Owning Palantir at current levels means accepting that this pace of growth, or something close to it, needs to continue for several more years rather than one more good print.
Profitability Adds Weight to the Bull Case
GAAP net income reached $1.07bn, a 55% margin, while the Rule of 40 score, which blends growth and profitability into a single measure of software quality, climbed to 155%, a level few companies at this scale have matched.
Even so, the multiple attached to those numbers started from an extreme base before tonight’s rally, with the shares trading at roughly 78 times trailing revenue and above 100 times forward earnings, multiples that dwarf the wider software sector despite this year’s pullback.
RBC Capital has kept a sell rating and a $90 price target, arguing that even growth above 80% doesn’t rescue a share price that already reflects a great deal of good news.
Analysts Split Over Palantir Valuation
Baird, Oppenheimer and Wedbush take the opposite view, with targets between $200 and $230 built on the remaining US commercial deal value more than doubling to $6.24bn, alongside total contract value of $3.37bn, up 49% year on year.
Those contract figures matter because they point to revenue visibility stretching well beyond a single quarter, which a headline growth number on its own can’t show.
Jefferies has repeatedly flagged insider selling as a reason for caution, contrasting the pattern at Palantir with buying activity at rival software firms and reading it as a signal that those closest to the business are less convinced than the growth figures suggest.
Guidance Increase Becomes the Key Test
There’s a pattern worth weighing against tonight’s reaction too, since Palantir’s Q1 2026 report delivered 85% revenue growth and an EPS beat yet the shares still fell nearly 7% the following day, showing that strong headline numbers haven’t always been enough on their own.
What appears to have shifted sentiment this time is the guidance raise rather than the beat itself, with US commercial guidance lifted to above $3.42bn and 134%+ growth giving bulls a concrete reason to extend their assumptions instead of just admiring one strong quarter.
Whether that holds now depends on international expansion overcoming sovereignty concerns in markets like the UK, and on US commercial customers renewing and expanding contracts at the pace management is now projecting, neither of which is guaranteed.
The results are strong enough to justify holding rather than chasing tonight’s pop or abandoning the position altogether, since the valuation still prices in years of exceptional growth and this quarter bought the bulls more time to prove it without settling the argument either way.
