Key Highlights
- Shares of Palantir declined approximately 8% during premarket hours Tuesday following third-quarter results that showed decelerating contract momentum.
- The company posted quarterly revenue of $2.313 billion, marking 96% growth compared to the same period last year.
- New contract bookings increased only 6% annually to $2.918 billion, a sharp deceleration from the 49% expansion recorded in the prior quarter.
- Growth in U.S. commercial contract value slowed dramatically to 11%, down from 153% growth during the second quarter.
- The company’s long-term remaining performance obligations decreased by $70 million, settling at $2.74 billion.
Palantir (PLTR) experienced a sharp decline in premarket activity Tuesday, with shares dropping nearly 8% following disclosure of moderating contract expansion in the third quarter. Trading activity showed shares near $164.15 around 8 a.m. ET, marking a significant retreat from Monday’s closing price of $178.34.
Palantir Technologies Inc., PLTR
The company delivered revenue of $2.313 billion for the period, representing 96% expansion from the year-ago quarter. Adjusted profit came in at $0.44 per share. While both metrics surpassed Wall Street expectations, the pace of new contract signings showed considerable moderation compared to the preceding quarter.
Contract Momentum Decelerates Sharply
The company secured new contracts valued at $2.918 billion, reflecting 6% annual growth. This represents a significant slowdown from the second quarter, which posted 49% year-over-year expansion with total contract value of $3.373 billion.
Within the U.S. commercial segment, contract bookings reached $1.463 billion, climbing 11% from the prior-year period. The comparison becomes stark when measured against the previous quarter’s performance of 153% annual growth and $2.132 billion in total contracts. The company also completed 212 transactions exceeding $1 million in value, a slight decrease from 220 such deals in the prior period.
These metrics reflect committed business arrangements, including optional extensions customers may exercise, rather than recognized revenue. The deceleration occurred as artificial intelligence stocks faced broader selling pressure, with Goldman Sachs reporting that hedge funds trimmed exposure to related positions throughout October.
Future Performance Obligations Show Contraction
The company disclosed $2.74 billion in long-term remaining performance obligations, representing a decrease from $2.81 billion reported in the second quarter. This $70 million sequential decline occurred while shorter-duration obligations expanded from $2.09 billion to $2.14 billion.
Combined obligations edged lower to $4.88 billion from $4.90 billion. Despite the modest sequential decrease, the total remained 88% higher than the year-earlier comparison. This metric captures contracted revenue awaiting recognition but excludes agreements with durations of 12 months or shorter.
Chief Financial Officer David Glazer noted that termination provisions in government contracts limit how fully this metric captures that business segment. Meanwhile, U.S. commercial remaining deal value climbed to $6.517 billion, advancing 79% on an annual basis.
Other technology enterprises have encountered scrutiny regarding expanding capital expenditures for AI infrastructure. Amazon recently disclosed a trailing annual free cash flow outflow of $42.4 billion as it accelerated data-center investments.
Management Lifts Full-Year Revenue Guidance
Palantir forecasts fourth-quarter revenue between $2.649 billion and $2.653 billion, exceeding the $2.46 billion analyst consensus. The company also elevated its 2026 revenue projection to a range of $8.530 billion to $8.534 billion.
Glazer indicated that customers executed multiple shorter-term Sovereign AI agreements valued in the tens of millions of dollars. He anticipates both the size and length of these contracts will expand over time, though management did not directly attribute the decline in long-term obligations to this contract structure.
The Palantir-linked token PLTRB traded around $164.14, down 12% over the preceding 24-hour period. Performance of this token diverges from the company’s Nasdaq-listed equity. Broader financial markets continue evaluating proposals for tokenized stock trading systems following objections from several corporations to one suggested framework.
Shares had experienced five consecutive losing sessions through Monday’s close. The stock shed approximately 10.3% during that stretch and finished 16.2% below its 52-week peak of $212.94.
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