Palantir Beats Expectations in Q4 Report, but Company Still Sees Shares Fall in Pre-Market Trading

By Thomas Price Tuesday, February 16, 2021

Tech and software company Palantir recently reported a strong Q4 earnings report, where the business saw stronger than expected revenues beating out projections made from Wall Street analysts. Much of the revenue has been based on lucrative contracts with the United States (US) federal government, making the company one of the few in the technology industry to regularly partner with them. Despite strong revenue reports, the business has still seen shares drop in pre-market trading.

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Palantir’s Q4 Results in Comparison to Analyst Expectations

Following an already strong year in 2020, tech company Palantir posted promising Q4 results as new business has allowed for large growths in revenue. In Q4, the company reported $322 million in revenue, a 40% year-over-year growth (YOY). This figure also beat out analyst projections, which had the business only taking in $300.7 million. On the year, Palantir reported a total revenue of $1.1 billion, marking a 45% increase from 2019, showing an incredible business growth trajectory.

Despite the pace of growth and outperforming expert predictions in revenue, the company still reported a loss per share of $0.08. The reported loss from the business was well above projections from analysts that had expected a loss closer to $0.03 per share.

Outside of direct numbers, Palantir also closed on several new contracts of significant value, including 21 deals worth over $5 million and 12 worth over $10 million. Many of the contracts taken on by Palantir are with the US government, breaking from major tech companies such as Google, Microsoft, and Amazon, who rarely work with the government. Notably, the company has done business with the FDA, US Army, US Air Force, ICE, and CBP. Government contracts are responsible for 59% of the company’s total revenue in Q4, adding up to $190 million, an 85% growth compared to the same quarter in 2019. On the other hand, commercial contract revenue resulted in $132 million in revenue, up 4% from 2019.

Palantir’s 2021 Outlook and Stock Market Response

In the Q4 report, the company also provided guidance for 2021. Palantir expects to continue seeing revenue growth throughout the year with expectations of a 45% growth YOY from 2020. The same figure of growth is also expected specifically for Q1 as well. Despite the strong outlook on the future and the overperformance in revenue, the loss per share that the company reported has soured some investors. In fact, the company’s stock is down close to 5% in pre-market trading, taking value per share to just around $30.

Despite the early morning dip, Palantir’s stock has seen incredible growth since going public in September of 2020 at just $9.50 a share. Since then, the value of the company’s stock has more than tripled to where it is today, with expectations from many investors that this trend will likely continue well into the future. This success remains especially true if Palantir continues to be one of the largest tech companies to do serious business with the US Government while also furthering its expansion of private commercial contracts.

About the Author

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Tom Price is a writer focusing on entertainment and sports features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.

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