TLDR
- Palantir’s market capitalization of $394 billion would need to increase 145% to join 10 companies in the trillion-dollar club led by Nvidia.
- Third-quarter performance shows $1.18 billion revenue with 63% growth, US commercial sales up 121%, and government contracts rising 52%.
- Stock valuation sits at P/E of 444 and P/S of 112 after climbing 2,000% since ChatGPT’s debut in late 2022.
- Company shifts focus from development to deployment as R&D spending falls to 12.2% of revenue while operating margins reach 51%.
- Palantir secured 204 deals over $1 million and posted $540 million in adjusted free cash flow with total contract value at $2.8 billion.
Palantir Technologies holds a market cap of $394 billion. The company needs its stock to rise 145% to break into the trillion-dollar valuation tier.
Palantir Technologies Inc., PLTR
Ten companies currently occupy that exclusive club. Nvidia tops the list at $4.6 trillion, with Apple at $4.0 trillion and Microsoft at $3.8 trillion.
The data analytics specialist reported third-quarter revenue of $1.18 billion. Year-over-year growth came in at 63%.
US commercial revenue jumped 121% to $397 million. Government revenue climbed 52% to reach $486 million.
Palantir’s platform portfolio includes three core products. Foundry organizes enterprise data across disparate systems for commercial clients.
Gotham serves defense and intelligence operations. Apollo handles distribution infrastructure across various deployment environments.
The company closed 204 contracts worth at least $1 million. Ninety-one deals exceeded $5 million, while 53 surpassed $10 million.
Profitability Shows Upward Trajectory
Adjusted operating income hit $600.5 million in the third quarter. That compares to $275.5 million in the same quarter last year.
Operating margins expanded to 51% from 38% a year earlier. Adjusted free cash flow reached $540 million with a 46% margin.
Research and development costs tell a revealing story. They fell from 18% of revenue in full-year 2024 to 12.2% in the third quarter of 2025.
Employment trends support this transition narrative. Developer job postings dropped from 250 in October 2024 to approximately 150 by September 2025.
Roles focused on operations and deployment increased 13% during the same period. This pattern indicates a shift from building software to implementing it.
Total contract value for the quarter reached $2.8 billion, up 151%. US commercial total contract value set a record at $1.3 billion, rising 342%.
Valuation Multiples Draw Scrutiny
The stock carries a forward price-to-earnings ratio of 237. Its price-to-sales multiple stands at 112.
The trailing P/E ratio of 444 has declined from a summer peak near 600. However, it remains far above comparable technology companies.
Palantir’s market cap stood at $12 billion before the AI boom began. The stock has rallied approximately 2,000% since then.
Apple’s highest post-2001 P/E ratio reached about 100. For Palantir to match that level, profits would need to multiply 4.5 times.
Wall Street analysts remain cautious. Only three of 16 analysts who recently covered the stock recommend buying it.
US commercial remaining deal value grew 199% year-over-year to $3.6 billion. The company posted a Rule of 40 score of 114% in the third quarter.
Adjusted earnings per share came in at $0.21. Trailing twelve-month adjusted free cash flow totaled $2.0 billion with a 51% margin.
The AI software addressable market is estimated at $13 trillion. Palantir continues expanding in both commercial and government sectors.
Other trillion-dollar club members include Alphabet, Amazon, Broadcom, Meta Platforms, Taiwan Semiconductor, Tesla, and Berkshire Hathaway.
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