- Palantir CEO Alex Karp credits the defense tech wave for the company's strong Q1 performance.
- The company raised its annual revenue guidance amid AI software sales momentum.
- Palantir's stock is up over 64% this year.
Palantir CEO Alex Karp is riding high on the pro-defense tech wave largely ushered in by the Trump administration.
On Monday's earnings call, Karp attributed the company's first quarter performance to "an unvarnished cacophony of the combination of 20 years of investment and a massive cultural shift in the US," he said.
"Culturally, we just don't see the resistance to the way we roll that we did in the past," Karp added.
He also touted the company's "warrior culture" and that cultural shift, leading the defense tech giant to lift its full-year revenue guidance as AI software sales have gained momentum. The company now expects annual revenue to be between $3.89 billion and $3.90 billion, up from last quarter's midpoint estimate of $3.75 billion.
That's contrary to what many companies have been doing after reporting earnings this quarter. Several have slashed or ditched guidance altogether.
Palantir reported strong revenue figures across the board this quarter. US commercial revenue — meaning revenue from non-governmental customers — jumped 71% year-over-year to $255 million. US government revenue rose to $373 million, up 45% from a year ago. Total revenue grew 39% from a year ago, topping the high end of its prior guidance by almost 350 basis points.
The company's stock has soared over 64% this year, from just over $75 per share at the beginning of January to over $123 at Monday's close. The stock hit a high of almost $125 per share in mid-February.
Palantir is also continuing to double down on AI agents, with its enterprise-focused AI platform in the "next phase of product development and adoption," chief technology officer Shyam Sankar said on the company's earnings call.
"AI agents aren't just transforming the US commercial sector — they are transforming how we fight," Sankar said. "AI agents are analyzing intelligence, finding targets, automating staff functions, and improving the understanding of the battle space."
Despite the Trump administration's apparent interest in incorporating new defense technologies into the Pentagon, the government cut over $5 billion in Defense Department contracts in April. When asked about how recent reductions to federal spending and defense-related budget cuts might impact Palantir's current contracts and future contract acquisition, Sankar called DOGE employees "heroes."
"This is the right thing for the country — like, we have way too much spend on things that do not work," Sankar said. "The government has started to resemble a fine-marbled wagyu — the fake projects that do not deliver and will never deliver crowd out and suffocate the things that could actually be excellent, so we welcome DOGE."
Karp added that the company "does exceptionally well when things are pen-tested" and that they "like pressure on the system."
During the first quarter of 2025, the company also delivered its first AI-powered TITAN ground vehicles to the US Army, which the company worked on with both traditional and non-traditional partners, such as contractors Northrop Grumman and L3 Harris as well as defense tech startup Anduril.
In response to an investor's question, Sankar ascribed a recent push for American manufacturing to "all of those people who are essentially the progeny of Elon who have learned and understood how to actually make things," he said. "That's like the basis of reindustrialization in America."
Palantir's shares are down over 8% in after-hours trading.
