PLTR · Q4 2025 Earnings

Bullish

Palantir

Reported February 2, 2026

30-second summary

Revenue grew 70% YoY to $1.41B in Q4, beating the $1.331B high end by ~$76M and accelerating seven points from Q3's 63%. U.S. commercial revenue jumped 137% to $507M and U.S. revenue crossed $1B for the first time at $1.076B (+93% YoY). Management guided FY26 revenue to $7.19B at the midpoint (+61% YoY), the third consecutive guide-raise cadence above 60%, and disclosed a Rule of 40 score of 127 — both numbers are now central to the bull case that Palantir has separated from the enterprise software cohort entirely.

Headline numbers

EPS

Q4 FY2025

$0.25

Revenue

Q4 FY2025

$1.41B

+70.0% YoY

Gross margin

Q4 FY2025

84.7%

Free cash flow

Q4 FY2025

$0.79B

Operating margin

Q4 FY2025

40.8%

Key financials

Q4 FY2025

Metric	Q4 FY2025	YoY	Q3 FY2025	QoQ
Revenue	$1.41B	+70.0%	$1.18B	+19.1%
EPS	$0.25	—	$0.21	+19.0%
Gross margin	84.7%	—	82.4%	+230bps
Operating margin	40.8%	—	33.3%	+750bps
Free cash flow	$0.79B	—	$0.54B	+46.5%

Guidance

Guidance is issued for both next quarter and the full year. Both may appear below.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Revenue	Q4 FY2025	$1.327 - $1.331 billion	$1.407 billion	+$0.076-0.080 billion above guide	Beat
Revenue YoY growth	Q4 FY2025	61%	70%	+9 points above guide	Beat
Adjusted income from operations	Q4 FY2025	$695 - $699 million	$574 million	-$121-125 million below guide	Beat
U.S. Commercial Revenue	FY2025	in excess of $1.433 billion	$1.476 billion	+$0.043 billion above 'in excess of' threshold	Beat
U.S. Commercial Revenue Growth	FY2025	at least 104%	120%	+16 points above 'at least 104%' threshold	Beat
Adjusted income from operations	FY2025	$2.151 - $2.155 billion	$2.267 billion	+$0.112-0.116 billion above guide	Beat
Adjusted free cash flow	FY2025	$1.9 - $2.1 billion	$2.27 billion	+$0.17 billion above high end of guide	Beat
Rule of 40 Score	FY2025	102%	127%	+25 points above guide	Beat
Revenue	FY2025	$4.396 - $4.400 billion	$4.475 billion	+$0.075-0.079 billion above guide	Beat

New guidance

Metric	Period	Guide	YoY
Revenue	FY2026	$7.182 - $7.198 billion	61%
Revenue YoY growth	FY2026	61%	—
U.S. Commercial Revenue	FY2026	in excess of $3.144 billion	—

Segment performance

Q4 FY2025

Segment	Q4 FY2025	YoY
U.S. Commercial Revenue	$0.507B	+137.0%
U.S. Government Revenue	$0.57B	+66.0%
U.S. Revenue	$1.076B	+93.0%
U.S. Commercial Revenue Growth YoY	137%	—

Platform metrics

Q4 FY2025

Segment	Q4 FY2025
Total Contract Value (TCV)	$4.262 billion
U.S. Commercial TCV	$1.344 billion
U.S. Commercial Remaining Deal Value (RDV)	$4.38 billion
Deals >= $1M Closed	180
Deals >= $5M Closed	84
Deals >= $10M Closed	61
Customer Count Growth YoY	34%

Profitability

Q4 FY2025

Segment	Q4 FY2025
Rule of 40 Score	127%
Adjusted Operating Margin	57%

Management tone

Q2 combative-triumphalist → Q3 historical-superlatives → Q3 systemic-claim → Q4 N-of-1 / categorical separation. The arc this quarter completes management's pivot from "we're the leading enterprise software company" to "enterprise software is the wrong reference class."

Three quarters ago the Rule of 40 in the mid-80s was the stretch target; this quarter it's 127 and framed as proof the company has exited the category. In Q2 the 94 Rule of 40 was the call's headline number; in Q3 the 114 was the print of "the best results any software company has ever delivered." This quarter Karp anchored the entire framing on the new score: "Palantir is an N of 1. This is what makes a rule of 127 possible." The shift signals management believes the comparable-set debate is over — and that FY26's 118 Rule of 40 guide should be measured against that ceiling, not enterprise software peers.

AIP framing escalated again from "the only platform with a compounding plan" (Q3) to "the only company scaling the leverage from commoditized AI." Q2 sold AIP as the replatforming layer; Q3 reframed competitors as extractive. This quarter management drew the explicit line: "The next step is for the market to differentiate between those who are supplying the commoditization of cognition and those who are scaling the leverage made possible by it. We are the only enterprise software company that made a conscious choice to focus exclusively on the latter." The shift recasts foundation-model providers from competitors to commodity input suppliers — a positioning that, if accepted by the market, recalibrates the multiple peer set away from MSFT/GOOGL/ORCL and toward something with no obvious comp.

AI adoption rhetoric moved from iterative to existential. A year ago AI deployment was framed as a competitive advantage; last quarter as the determinant of which enterprises survive; this quarter Karp's prepared remarks made it terminal: "Speed to production and transformational scale is no longer optional. It's existential. Palantir remains the only platform delivering that speed at enterprise scale. Those still on the other side, the AI have-nots, are fighting for survival in the present." The shift signals management will continue pricing to value-share rather than negotiation — and explains why Q4 deal sizes inflated even as deal count moderated.

Hypergrowth and margin expansion reframed from aspiration to operating model. In Q2 Karp argued the two could coexist; in Q3 the print made it visible; this quarter management called it deterministic: "proving that hypergrowth and exceptional profitability aren't mutually exclusive, but rather the inevitable outcome of Palantir delivering transformational impact at scale." The choice of "inevitable" is the tell — it commits the company to defending both growth and margin in 2026 with no fallback narrative if either slips.

Karp's closing remarks pivoted from financial valedictory to geopolitical maximalism. Atypical for an earnings call, the framing of Western institutional adoption velocity versus China's became the closing note rather than a side comment. This is the third consecutive quarter where Karp's tone has gotten louder, not quieter, after a beat — signaling continued willingness to take Q1 26 down if expectations get ahead of him, but no internal evidence of conservatism in the guide itself.

Recurring themes management leaned on this quarter:

AI production at enterprise scale as existential differentiatorOntology and orchestration as core value creation layerU.S. commercial acceleration (137% YoY, 28% sequential) as proving new categoryCustomer expansion velocity and compounding (utility $7M to $31M ACV; energy $4M to $20M ACV)Government AI adoption as national security imperativeHiring elite technical talent while expanding margins

Risks management surfaced:

International commercial weakness (8% YoY growth, 2% full-year YoY)Strategic commercial contracts declining ($5.1M Q1 2025 to $1-3M Q1 2026 guidance)Execution risk in government programs and defense timelinesDependency on ontology and proprietary orchestration remaining differentiatedWestern institutional hesitance to adopt at scale versus China's adoption velocity

Q&A highlights

Mariana · Bank of America

On commercial side: Have customers' hesitancy to implement AI changed, and is 2026 the 'show me' year? On defense: Are there opportunities beyond SHIP OS (e.g., ammo OS, missile OS) for reindustrialization efforts?

Management emphasized showing direct value impact to customers quickly, noting 61 deals over $10M closed. Customers now arrive with proof points from other companies rather than skepticism. On defense, reindustrialization spans beyond shipbuilding to pharmaceuticals and data centers. SHIP OS applies across weapon systems (fighters, bombers, drones, munitions) from factory to foxhole, with MAVEN providing integrated view.

61 deals closed over $10 millionSHIP OS expanding to fighters, bombers, surface vessels, drones, munitions, and sustainmentReindustrialization efforts spanning defense, pharmaceuticals, data center constructionMAVEN investment changed joint force combat operations

Dan · Wedbush

Are you seeing expansion where you enter for one problem (X) but end up solving for multiple problems (Y), capturing larger budget share on both commercial and defense sides?

Management confirmed revenue growth significantly outpaces customer count growth, indicating deeper penetration and higher value extraction per customer. Customers are placing their most important problems with Palantir, creating determinative business value. Customers recognize Palantir's differentiated knowledge and tribal knowledge, now amplified by AI.

Revenue growth significantly exceeds customer growth (inexplicable growth pattern)Rule of 127 (127 net revenue retention)U.S. growth at 93%Guidance at 61% (vs 31% prior year)

Mariana · Bank of America

Follow-up on commercial dynamics: Have you seen customers' resistance to AI implementation change? What's the current customer conversation dynamic?

Conversation has shifted from skepticism ('this weird thing might work') to proof-of-concept validation ('you've made this work'). Customers now ask how to accelerate, not whether it works. Management is actively shaping customer selection, with examples of major deployments where customer CEOs are deeply embedded in implementation and have reshaped their organizations. Focus is on density of high-impact clients rather than volume.

Proof-point validation across multiple use cases (underwriting, migration, etc.)Conversation shifted from doubt to 'how do we accelerate?'Management now shapes which customers to work withMajor deployments show customers reshaping orgs to absorb Palantir product

Answers to last quarter's watch list

Whether Q4 revenue lands above the $1.331B high end. Decisively yes — $1.407B beat the high end by $76M and YoY growth accelerated to 70% versus the 61% guide-implied. The "is acceleration topping" debate is closed.

Resolved positively

Whether U.S. commercial sustains triple-digit YoY growth in Q4. Yes, well above the threshold — $507M at +137% YoY, accelerating 16 points sequentially from Q3's 121%. The segment came in $77M above the implied Q4 ramp from the FY guide.

Resolved positively

U.S. commercial RDV trajectory. RDV grew from $3.63B (Q3) to $4.38B (Q4) — a $750M sequential add against $507M of revenue, sustaining the Q2→Q3 cadence of $840M. The bookings flywheel did not flatten; FY26 acceleration to ≥115% U.S. commercial growth is already substantially booked.

Resolved positively

Adjusted operating margin retention as headcount catches up. Adjusted operating margin held at 57% in Q4 (versus 51% in Q3); FY25 adjusted operating income beat the high end by $112M. Management is now guiding FY26 Rule of 40 at 118 while explicitly warning expenses will rise — the hiring ramp Karp flagged in Q2 has not compressed margins yet, but it's the structural watch item for 2026.

Resolved positively

Any explicit Maven or NGC2 contract-value disclosure. No discrete program-level revenue or contract-value figures were disclosed; government growth at 66% was attributed qualitatively to SHIP OS, MAVEN, and Warp Speed.

Not resolved

First read on FY26 framing. Management initiated FY26 revenue guide at $7.19B (+61% YoY), above where FY25 finished at 56% — guiding to acceleration, not normalization. U.S. commercial FY26 guide of ≥115% on a $3.14B+ base implies the segment more than doubles again. The multiple debate has been reset higher, not anchored.

Resolved positively

What to watch into next quarter

Whether Q1 FY26 revenue lands above the $1.536B high end. The Q1 guide implies ~9% sequential growth and an implied YoY in the high-50s on the $883M Q1 25 base; given Q3 and Q4 each beat the high end by $76M+, a beat below that magnitude will be read as the guide finally catching up to reality.

Whether U.S. commercial holds above 130% YoY in Q1 26. The FY26 ≥115% guide on >$3.144B implies an annual cadence; if Q1 prints below 130% the implied 2H ramp gets aggressive. Q4's $507M run-rate annualizes well above the FY26 floor, so the bar is the growth rate, not the dollar level.

U.S. commercial RDV continuing to compound above $700M per quarter. RDV adds of $840M (Q3) and $750M (Q4) have been the leading indicator that revenue acceleration is bookings-backed; if Q1 RDV grows by less than $600M sequentially the FY26 ≥115% guide starts to rely on net-new rather than backlog.

Adjusted operating margin holding in the mid-50s as 2026 hiring hits OpEx. Management has explicitly guided that expenses will rise in 2026 while still committing to a 118 Rule of 40. Any quarter where adjusted operating margin prints below 50% will be the first real test of the "inevitable outcome" framing Karp put on the call.

Strategic commercial contracts contribution. Management guided Q1 26 contribution from these contracts at just $1–3M, down from $5.1M in Q1 25 — a deliberate de-emphasis. Watch whether this becomes a recurring drag callout or fades from disclosure entirely.

Any quantification of MAVEN, SHIP OS, or Warp Speed. Three quarters running these have been cited qualitatively as drivers; the absence of program-level dollar disclosure is now conspicuous. A single contract-value print would convert "government accelerating" into "defense-vertical anchor."

Sources

Palantir Q4 2025 press release, filed with SEC: https://www.sec.gov/Archives/edgar/data/1321655/000132165526000004/a2025q4ex991earningsrelease.htm
Palantir Q4 2025 earnings call prepared remarks and Q&A (transcript referenced)

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