Palantir stock falls despite Q4 outlook beating Wall Street estimates amid US government shutdown worries

Core Viewpoint - Palantir's fourth quarter outlook exceeded Wall Street expectations, projecting revenue of over $1.3 billion, but shares fell over 6% in premarket trading due to valuation concerns [1][2][3] Financial Performance - Palantir expects fourth quarter revenue of just over $1.3 billion, surpassing the $1.2 billion forecast by analysts [2] - The company anticipates adjusted operating income between $695 million and $699 million, significantly higher than the $575 million expected [2] - Full year revenue guidance was raised to $4.4 billion from $4.15 billion [2] - In the third quarter, Palantir reported revenue of $1.18 billion, a 63% increase year-over-year, exceeding the $1.09 billion expected [5] - Adjusted earnings per share for the third quarter were $0.21, above the $0.17 expected and more than double the $0.10 from the same quarter in 2024 [5] - Revenue from US government contracts increased by 52% to $486 million, surpassing the $471 million forecast [5] - The US commercial segment saw a 121% year-over-year revenue increase to $397 million, exceeding the projected $342 million [5] Market Reaction - Despite strong financial results, Palantir's stock is set to decline at market open, reflecting concerns that performance and guidance do not justify its high valuation [3] - The stock has increased over 170% for the year, but analysts express skepticism about the sustainability of this growth [3][4] Business Insights - Palantir's CEO described the US commercial business as "an absolute juggernaut," highlighting its strong performance in recent quarters [6] - The company provides artificial intelligence software for various applications, including supply chain analysis and military targeting, but has faced public backlash over certain contracts [4]