In a video interview just hours ahead of Palantir’s earnings release, CEO Alex Karp flailed his arms excitedly as he spoke about the defense tech and AI software company’s results.
“These numbers validate we were right. Please learn from us. That’s what these numbers mean,” Karp told Fortune.
“These are not normal results. These are not even strong results,” he continued later on Monday during the company’s earnings call. “These aren’t extraordinary results. These are arguably the best results that any software company has ever delivered.”
Despite the strong performance, shares of Palantir took a pause on Monday after soaring roughly 400% over the past year. According to Bloomberg, the stock initially rose following the earnings release but then slid about 3.5% in after-hours trading.
Palantir posted third-quarter revenue of roughly $1.2 billion, up 63% from the year-ago period and above the average analyst expectation of $1.09 billion. The company’s net income of $476 million was up 40% year-over-year.
While Palantir’s government contracts business remains strong, growth in the third quarter was predominantly driven by its U.S. commercial customers, which expanded by 121% year-over-year to $397 million.
Karp described the numbers on Monday’s earnings call as more akin to a venture-backed company than a public one. He particularly highlighted the “Rule of Forty” metric featured in Palantir’s quarterly earnings deck—a financial measurement that combines the year-over-year revenue growth rate and the adjusted operating margin. Generally, 40% is considered strong performance.
This quarter, Palantir’s “Rule of Forty” was an impressive 114%, even higher than last quarter’s 94%.
Despite these stellar results, Palantir’s revenue figures remain relatively small compared to peers with similar market capitalizations. The company’s rich valuation has also fueled skepticism among some investors concerned about a potential AI bubble.
Adding to the intrigue, regulatory filings on Monday revealed that Michael Burry—the famed short seller known for his big bet against the subprime mortgage market in 2008—has taken short positions in both Palantir and NVIDIA.
Palantir and NVIDIA recently announced a partnership, where Palantir will integrate NVIDIA chips and software with its tech platform for certain customers. Last week, Palantir stated that home improvement retailer Lowe’s was already incorporating this technology into its tech stack. However, on Monday, the software company declined to share details of other customers who have rolled out the integration.
True to form, Karp did not shy away from addressing sensitive topics on Monday’s earnings call, including the U.S. Administration’s recent focus on drug traffickers in South America.
“Let me say something slightly political,” Karp said. “And I’m not saying other people agree with this, but when people are attacking our soldiers for stopping fentanyl from coming into this country, I want people to remember if fentanyl was killing 60,000 Yale grads instead of 60,000 working-class people, we’d be dropping a nuclear bomb on whoever was sending it from South America.”
Karp’s shareholder letter for this quarter—his fifteenth musing to shareholders and Palantir enthusiasts—was equally candid. In it, he suggested that there had been a “rejection of any shared and defined sense of common culture, in this nation and others,” noting that this “has had significant costs.”
More than anything, however, Karp seemed to revel in the numbers themselves, taking a moment to rub them in the faces of those he says have been too skeptical.
“Some of our detractors have been left in a kind of deranged and self-destructive befuddlement,” he wrote, before referencing a British film director and later invoking the poet William Butler Yeats.
Palantir’s latest results and Karp’s outspoken commentary highlight the company’s unique position at the intersection of defense, AI technology, and public markets—bringing both strong growth and intense scrutiny.
https://fortune.com/2025/11/03/palantir-earnings-record-revenue-alex-karp/
