Palantir falls 14% after Q1 beat; analysts see up to 60% upside

Palantir shares fell 14% after the company reported first-quarter revenue of $1.6 billion, up 85% from a year earlier, and raised its full-year revenue guidance.

Adjusted earnings per share for the quarter were $0.33, above Wall Street expectations. U.S. commercial revenue increased 133% to $595 million. The company reported GAAP net income of $871 million, which equates to a 53% profit margin for the quarter.

Management raised full-year revenue guidance to a range of $7.6 billion to $7.7 billion and said U.S. commercial revenue would exceed $3.2 billion, implying at least 120% growth for that segment.

The stock trades at roughly 105 to 110 times forward earnings and near a 50-times price-to-sales ratio.

Rosenblatt analyst John McPeake maintained a Buy rating and raised his price target to $225, noting Palantir’s Ontology platform links internal data to operational decisions. From the June 2 close near $152, that target implies about 48% upside; from recent pullback levels nearer $140, the implied upside approaches 60%. Loop Capital analyst Mark Schappel also kept a Buy rating and set a $220 target, citing AI-driven revenue acceleration and Palantir’s expanding role as enterprise infrastructure.

HSBC analyst Stephen Bersey lowered his rating to Hold and cut his price target to $151 from $205, citing increased competition from companies such as OpenAI and Anthropic and the risk that Palantir’s approach of embedding engineers and software inside customer workflows could become easier for rivals to replicate.

On the government side, Palantir’s Maven system is set to become an official Pentagon program of record. The Department of Defense has sought roughly $2.3 billion over five years to expand the Maven Smart System.

Investors sold shares after the report, producing the 14% decline. Analysts remain divided on the stock’s outlook, with some highlighting the company’s revenue growth and profit metrics and others pointing to valuation and competitive risks.