Palantir Q1 Revenue Soars 85% to $1.63B Despite Commercial Segment Miss
Palantir reported Q1 adjusted EPS of $0.33 and revenue surged 85% year-over-year to $1.63 billion, driven by $687 million in government contracts. Shares fell over 5% on a $595 million U.S. commercial revenue miss and concerns over rich valuations near 34x 2027 sales and 56x free cash flow.
1. Q1 Financial Highlights
Palantir delivered adjusted EPS of $0.33 and revenue of $1.63 billion, marking an 85% increase year-over-year. Government contracts led growth with $687 million in revenue, comfortably above estimates and underscoring strong public sector demand.
2. Commercial Segment Miss
U.S. commercial revenue reached $595 million, falling short of the $605 million analyst consensus and signaling headwinds in enterprise adoption. This shortfall prompted investor concerns over the consistency of growth beyond government deals.
3. Valuation and Market Reaction
Shares declined by over 5% following the report as valuation multiples remained stretched at roughly 34 times projected 2027 sales and about 56 times free cash flow. High expectations for sustained AI-driven growth leave limited room for further revenue or profit misses.