By Arsheeya Bajwa
(Reuters) – Palantir Technologies forecast a full-year profit above Wall Street estimates on Tuesday, as the data analytics company benefits from strong demand for its artificial intelligence offerings.
Enterprises are looking to build and deploy their own AI-backed offerings, helping demand for Palantir’s products including its Artificial Intelligence Program, which CEO Alex Karp sees as the “future” of the company.
Palantir signed 103 deals of over $1 million each in the fourth quarter, Chief Revenue Officer Ryan Taylor told Reuters.
U.S. commercial revenue in the quarter ended Dec. 31 surged 70% to $131 million, compared with a 12% increase a year earlier.
The company said it expects 2024 U.S. commercial revenue above $640 million, projecting growth of at least 40%, compared with a 36% rise in 2023.
Fourth-quarter commercial revenue stood at $284 million, beating analysts’ average estimate of $270 million, according to LSEG data.
The company reported quarterly revenue of $608.4 million above estimates, and a record profit of $93.4 million.
However, growth at its mainstay government segment, which contributed more than half of total fourth-quarter revenue, has continued to slow. Government revenue grew 11% compared with a 23% jump a year earlier.
Analysts have flagged uncertainty in the recognition of revenue from government deals, citing “lumpiness of government contracts” as revenue from such deals likely shows up in the company’s books without much consistency.
Last month, Palantir entered into an agreement with the Israeli Defense Ministry to provide technology as the war in Gaza continues.
On an adjusted basis, the company forecast 2024 profit between $834 million and $850 million, above LSEG estimates of $658.8 million. Its revenue forecast was in line with estimates.
But its current-quarter revenue forecast was below estimates. Revenue chief Taylor attributed this to seasonal weakness in the first three months of the year.
(Reporting by Arsheeya Bajwa in Bengaluru; Editing by Shinjini Ganguli)