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Palantir Shares Fall 5% After Q3 Earnings Show Slower Contract Growth
Palantir shares fall 5% after third-quarter earnings show slower U.S. commercial contract growth.
Key points
- U.S. commercial revenue topped government revenue for the first time, according to the article.
- Palantir closed $1.5 billion in U.S. commercial total contract value, up 11% from last year.
- Goldman Sachs analysts said converting shorter contracts into longer commitments will be key.
Why it matters. Investors will be watching later quarters to see whether the 11% growth in U.S. commercial contract bookings is a temporary fluke or something structural, according to the article.
Palantir shares fell on Tuesday after the software company reported third-quarter earnings showing signs of slowing contract growth, analysts said. U.S. commercial revenue topped government revenue for the first time, but U.S. commercial total contract value reached $1.5 billion, up 11% from a year earlier, versus a record $2.1 billion in the second quarter, up 153%. Piper Sandler said demand still outstrips supply, while Goldman Sachs noted the company attributed some of the slowdown to shorter contract durations.
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Palantir Shares Fall 5% After Q3 Earnings Show Slower Contract Growth
Palantir shares fell about 5% on Tuesday after the software company reported third-quarter earnings that failed to impress investors. Analysts pointed to signs of a slowdown in total contract value and other forward indicators. U.S. commercial revenue exceeded government revenue for the first time. The company closed $1.5 billion in total contract value in its commercial segment, up 11% from a year earlier. That is well below the record $2.1 billion it closed in the segment in the second quarter. The stock decline reflects investor concern about future growth.