Palantir jumps 9% as Q2 revenue tops Wall Street estimates

Palantir Technologies Inc. (NYSE: PLTR) shares jumped 9% pre-market after the data analytics firm topped Wall Street revenue estimates for Q2 and offered a buoyant outlook for the current quarter. The company reported a revenue jump of 49% YoY to 376 million against $352.3 projected by analysts. In addition, the adjusted EPS of $0.04 was consistent with what analysts predicted.

Planter expects adjusted free cash flow of $300 million this year

The company now expects a full-year adjusted free cash flow of more than $300 million, up from more than $150 million previously. Palantir also reiterated its forecast of 30% or more yearly revenue growth through 2025.

According to the company, its commercial revenue in the US climbed 90% YoY during the quarter, while the commercial client count grew 32% QoQ.  Kevin Kawasaki, Palantir's business development head, said their commercial client base is expected to more than double by the end of this year. In Q2, the company added 20 new clients, and at the end of Q4 2020, its customer base comprised of 149 clients. The company entered 21 contracts worth over $10 million and 30 deals estimated to be over $5 million.

Palantir solutions became popular during the pandemic

The company, co-founded by CEO Alex Karp, Peter Thiel, and others in 2003, offers data analytics solutions for government agencies such as the intelligence community, the FDA, and the Defense Department.

By gaining new commercial customers, the company has moved to diversify its revenue past huge government deals. Last month, Palantir released Foundry for Builders, a subscription-based edition of their data collecting and analytics solution aimed at start-ups. Equally, the company stated that it signed companies in robotics, health care, finance, and software tied to former Palantir personnel.

In July, the company renewed its agreement with the U.S. Department of Health and Human Services to use its software in tracking vaccine development, supply, and administration across the country.  The pandemic gave the Palantir business a massive boost as its tools were used to track coronavirus spread.

Palantir’s investment in SPACs scrutinized

The company has increased investment in SPACs which has triggered some scrutiny. But Kawasaki said the company is not buying revenue through SPAC investments because only less than 1% of the company’s revenue in Q2 was related to investments in the SPACs. Kawasaki said: