Palantir's AI Momentum Continues. Can It Keep Going, or Is It Too Late to Buy the Stock?

Core Insights - Palantir Technologies has demonstrated strong performance, with its stock increasing by 575% over the 12 months ending August 6, 2023, following robust Q2 results [1][2] Revenue Growth - Palantir's revenue growth has accelerated for eight consecutive quarters, with Q2 2023 showing a year-over-year growth of 48%, up from 13% in Q2 2022, and Q2 revenue reaching $1 billion, surpassing management's forecast of $934 million to $938 million [3][4] - U.S. commercial revenue surged 93% to $306 million, with remaining deal value increasing 145% to $2.79 billion, and the customer count rising 64% year over year to 485 [5] - Government revenue also saw significant growth, with total revenue jumping 49% year over year to $553 million, and U.S. government revenue increasing 53% to $426 million [6] International Performance - International government revenue grew 37% to $127 million, achieving the highest-ever bookings quarter in this segment, while international commercial revenue declined 3% to $144 million [7] Customer Metrics - Net dollar retention was reported at 128%, indicating expansion among existing customers, up from 124% in the previous quarter [7] Earnings and Guidance - Adjusted earnings per share rose from $0.09 to $0.16 year over year, exceeding the analyst consensus of $0.14 [8] - For Q3 2023, the company guided revenue between $1.083 billion and $1.087 billion, projecting nearly 50% growth at the midpoint, and raised its full-year revenue guidance to a range of $4.142 billion to $4.150 billion, representing 45% growth [8] Valuation and Future Outlook - Palantir's stock trades at a forward price-to-sales ratio exceeding 110 times 2025 estimates, indicating a high valuation with limited room for error [10] - The acceleration in quarterly revenue growth and the broad applicability of its AI Platform suggest significant future potential for the company [11]