Palantir’s record quarter masks a decline in US enterprise deal value
Revenue passes $2 billion as commercial sales take the lead
Palantir reported third-quarter revenue of $2.31 billion, up 96% year on year and 20% from the preceding quarter. It was the company’s first quarter above the $2 billion revenue threshold and exceeded analysts’ expectation of $2.18 billion. Adjusted earnings per share were $0.44, compared with expectations of $0.41.
The company also raised its full-year revenue guidance. Its U.S. commercial business generated $984 million in the quarter, a 148% increase from a year earlier, surpassing U.S. government revenue of $953 million for the first time.
The commercial performance builds on Palantir’s commercial AI revenue growth as enterprise demand for Palantir’s AI software continues to reshape the mix between its corporate and government businesses.
Contract value points to a less settled enterprise market
Alongside the headline growth, Palantir disclosed a softer indicator for its U.S. enterprise pipeline. It closed $1.46 billion in total contract value with U.S. enterprises during the quarter, down from the record $2.13 billion reported in the previous quarter.
Chief executive Alex Karp told analysts that commercial engagements are moving faster from initial interaction to deployment, with shorter contract durations and the potential for substantial subsequent expansion. That pattern reflects an enterprise AI market in which companies can begin trials with less of their usual procurement friction, while retaining greater freedom to end an engagement.
Palantir attributes demand to software that lets customers run frontier models and securely custom-train open-weight models without sharing their data or business processes with outside AI laboratories. Its forward-deployed software engineering model also helps customers tailor deployments to their own operations.
Guidance sets the next test
Management raised its outlook for U.S. commercial revenue to more than $3.559 billion for the full year, implying growth of at least 143%. The next earnings report will show whether the lower quarterly enterprise contract value was temporary or signals a slower pace of new sales.
For businesses evaluating enterprise AI suppliers, Palantir’s quarter underlines the need to distinguish rapid trial adoption from durable commitments. Procurement teams should assess renewal terms, expansion evidence and contract duration alongside revenue growth before treating early deployment momentum as a long-term operating outcome.