Palantir Reports Q4 2024
$PLTRKey Financial Metrics:• Q4 Revenue: $828M, up 36% Y/Y, 14% Q/Q• U.S. Revenue: $558M, up 52% Y/Y, 12% Q/Q• U.S. Commercial Revenue: $214M, up 64% Y/Y, 20% Q/Q• U.S. Government Revenue: $343M, up 45% Y/Y, 7% Q/Q• GAAP Net Income: $79M (10% margin)• Net Income Excluding One-Time SAR Expenses: $165M (20% margin)• GAAP EPS: $0.03, Adjusted EPS: $0.14• Adjusted EBITDA: $380M (46% margin)• Cash from Operations: $460M (56% margin)• Adjusted Free Cash Flow: $517M (63% margin)• Earnings Highlights:• Record U.S. commercial total contract value (TCV) of $803M, up 134% Y/Y• U.S. commercial remaining deal value (RDV) grew 99% Y/Y to $1.79B• Customer count increased 43% Y/Y, 13% Q/Q• 129 deals of at least $1M, 58 deals of at least $5M, and 32 deals of at least $10M closed in Q4• Rule of 40 score of 81%, highlighting strong revenue growth and profitability• Comparison to Estimates:• Revenue of $828M beat consensus estimates (~$810M)• Adjusted EPS of $0.14 exceeded expectations of ~$0.12• U.S. commercial growth of 64% Y/Y outperformed forecasts• Stronger-than-expected free cash flow and contract value growth• Guidance:• Q1 2025 Revenue: $858M - $862M• Q1 2025 Adjusted Income from Operations: $354M - $358M• FY 2025 Revenue: $3.741B - $3.757B (31% Y/Y growth)• FY 2025 U.S. Commercial Revenue: $1.079B+ (54% growth)• FY 2025 Adjusted Income from Operations: $1.551B - $1.567B• FY 2025 Adjusted Free Cash Flow: $1.5B - $1.7B• Business Segment Performance:• U.S. Commercial: $214M (+64% Y/Y, +20% Q/Q)• U.S. Government: $343M (+45% Y/Y, +7% Q/Q)• International Commercial: Growth figures not disclosed but likely a weaker contributor• U.S. continues to be the primary driver of growth, with commercial revenue outpacing government• Market Commentary:• Palantir’s Q4 results and FY 2025 guidance significantly outperformed expectations, particularly in U.S. commercial growth• CEO Alex Karp emphasized AI’s role in driving business transformation, reinforcing Palantir’s leadership in AI and data analytics• Strong contract value growth suggests a durable revenue pipeline, particularly in commercial sectors• Potential concerns include reliance on government contracts and stock-based compensation expenses• Additional Notable Items:• Cash & Short-Term Investments: $5.2B, maintaining strong liquidity• Stock Appreciation Rights (SARs) impacted GAAP net income but were excluded in adjusted figures• Continued investment in AI capabilities and expansion in commercial enterprise markets• Traders’ Takeaway:• Strong revenue beat and raised FY 2025 guidance should drive bullish sentiment• U.S. commercial momentum, particularly in AI-driven applications, positions Palantir for sustained growth• With over $5B in liquidity and significant free cash flow, the company remains financially strong• Key risks include government contract dependency and potential stock-based compensation dilution• Likely market reaction: Bullish, with potential upside continuation if AI and commercial traction persist
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