Renowned investor Michael Burry has revealed that while he holds no short position in Tesla, his current bearish bets are concentrated on AI-related names, most notably Palantir Technologies. Through his private family office, Burry has deployed significant capital into put options against Palantir, citing concerns that the company’s hyperscaler customers are materially understating asset depreciation costs. In his recent Substack disclosure, he noted that Palantir’s equity-like compensation to employees effectively dilutes existing shareholders by an estimated 3.2% annually, a rate he believes is not reflected in the company’s reported margins. This contrarian stance places Palantir among Burry’s top “Big Short” candidates and signals to investors that downside risk may be underappreciated, especially if actual depreciation expenses come to light in future filings.

In Q3-FY2025, Palantir’s U.S. commercial segment posted revenue growth of 121% year-over-year, driven by the rapid industrialization of its AI Platform and the high-velocity Bootcamp sales model. Total contract value (TCV) for new commercial deals surged by 342% versus the prior-year quarter, reflecting shorter sales cycles and increased deal sizes averaging $4.8 million. The Bootcamp approach—an intensive, on-site implementation and training program—has led to a closed-loop sales flywheel: faster pilot-to-production transitions, stronger referenceability, and a reported 87% renewal rate among corporate clients. These metrics underscore Palantir’s operational leverage and suggest durable revenue visibility extending beyond multi-year contract horizons.

Palantir’s trailing twelve-month return on equity of 27.6% lags some legacy software peers but highlights robust capital efficiency given the company’s heavy reinvestment in R&D and platform expansion. Management’s shift to modular pricing—offering standalone AI tools alongside enterprise bundles—has improved gross margin by 320 basis points over the past four quarters. Meanwhile, long-cycle contracts, averaging 42 months in duration, have provided predictable cash flow, contributing to an 18% year-over-year increase in operating cash flow. Investors should weigh this strong ROE trajectory against continued upfront investment costs, recognizing that sustainable returns will hinge on Palantir’s ability to convert pilot deployments into enterprise-wide rollouts.

Palantir has entered a $100 million strategic transaction with Surf Air Mobility to underpin the launch of SurfOS, Surf Air’s AI-driven private aviation software platform, scheduled for commercial release in 2026. Under the agreement, Palantir will deliver enterprise solutions for BrokerOS, OperatorOS, and OwnerOS modules, with $26 million allocated to accelerate engineering and go-to-market capabilities. Early integration tests have demonstrated a 22% improvement in flight scheduling efficiency and a 15% reduction in maintenance downtime. This partnership not only diversifies Palantir’s sector exposure but also showcases real-world applications of its AI Platform in asset-intensive industries, potentially unlocking incremental revenue streams beyond the core government and commercial segments.