Palantir sales growth applauds Wall Street on first results

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Palantir, the data analytics firm known for its work within the US defense and national security establishment, beat Wall Street forecasts with its first quarterly results since going public. and increased its revenue forecast for the rest of the year.

The company’s revenue growth accelerated to nearly 50% in the first nine months of this year, double the rate of 2019, thanks to new contracts with the U.S. military following a successful legal battle to gain better access to military spending.

Palantir shares rose 1.4% on Thursday after the market, continuing their strong gains in recent days.

Shares had risen by more than 40% since last week’s US election, despite concerns in some quarters that his heavy reliance on defense spending and close ties to the Republican administration would hurt Palantir if he wins the Democratic Party. .

On Thursday, the company said it had reduced its reliance on a small number of large clients – one of Wall Street’s main concerns about Palantir – with the proportion of its revenue coming from the top 20 clients falling to 61% so far this year, dropping 69 percent over the same period in 2019.

For the three months ending in late September, Palantir’s revenue climbed 52% to $ 289.4 million. It reported a net loss of $ 861 million, or 94 cents per share, of which $ 847 million was due to employee stock expenses following its direct listing in September.

Factoring in compensation costs and listing fees, it reported a profit of $ 73 million, or about 8 cents per share, compared to a loss of $ 92 million the year before. Wall Street expected adjusted earnings per share of 2 cents, with revenue of $ 279 million.

The company’s contribution margin, which it says is the best measure of its underlying profitability, reached 51% in the quarter.

That margin – based on gross profits minus selling and marketing costs, with stock-based compensation costs added – had already climbed to 48% in the first half, from 21% in 2019, largely a result of lower sales and marketing costs.

Palantir said this reflected a change in its business model as it faced fewer upfront costs with new contracts, although it also benefited from lower travel costs resulting from the pandemic.

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