Palantir Posts Its First $2 Billion Quarter as US Commercial Sales Pass Government Revenue

Palantir reported the strongest quarter in its history as a public company on Monday, November 2, 2026, and the stock still fell. Revenue reached $2.313 billion for the quarter ended September 30, up 96 percent from a year earlier and above the $2.18 billion Wall Street expected. It was the company's first quarter above $2 billion in sales, and adjusted earnings of 44 cents a share beat the 41 cent consensus while net income more than doubled to $1.13 billion.

Inside the results was a shift years in the making: US commercial revenue reached $984 million, up 148 percent, and passed US government revenue of $953 million for the first time. Total US revenue climbed 119 percent to $1.937 billion. Management raised full-year guidance again, yet shares fell as investors weighed much slower new contract signings against the sales surge.

A record quarter on paper

Palantir released its third-quarter results after the market closed on November 2. Revenue grew 96 percent year over year and 20 percent from the prior quarter, marking what the company described as its 13th consecutive quarter of accelerating sales growth. Adjusted operating income reached $1.43 billion, a 62 percent adjusted operating margin, and the company put its Rule of 40 score at 158 percent.

The results beat both the analyst consensus and Palantir's own guidance of $2.160 billion to $2.164 billion, clearing that range by roughly $150 million. GAAP operating margin came in at 47 percent, and adjusted earnings per share matched GAAP earnings per share at 44 cents.

Palantir closed the quarter holding $10.4 billion in cash and Treasury securities. For a company long asked when it would turn consistently profitable, the profit line now looks settled.

The milestone inside the numbers

The most watched detail was the revenue mix: for the first time in Palantir's history, US commercial revenue exceeded US government revenue. Commercial sales rose 148 percent to $984 million, while government revenue rose 96 percent to $953 million. Chief financial officer Dave Glazer called it a critical milestone in the company's history, according to reports of the call.

Palantir built its name on government work, from defense and intelligence contracts to public health systems. Commercial customers were long treated as the growth engine that would one day catch up, and that day arrived with force: US commercial revenue grew 29 percent from the second quarter alone, while government revenue grew 18 percent sequentially.

Chief executive Alex Karp framed the quarter around sovereign AI: institutions building their own AI capability on their own data, inside their own walls. Whether that pitch keeps converting into signed deals is the question the bookings numbers raised.

Why the stock fell anyway

What weighed on the shares was not revenue but new business signed during the quarter. Total contract value closed in the quarter was $2.918 billion, up only 6 percent from a year earlier. US commercial contract value reached $1.463 billion, up 11 percent, a sharp slowdown from the second quarter, when that figure hit a record of about $2.1 billion and grew 153 percent.

Remaining performance obligations held at $4.9 billion, up 88 percent year over year but flat sequentially, and total remaining deal value reached $13.4 billion, up 55 percent year over year and 2 percent sequentially. The pattern was the same across each measure: strong growth against last year, little movement against last quarter.

Investors read that as a warning: revenue recognizes work already booked, while contract value shows what is coming next, and when revenue grows 96 percent while bookings grow 6 percent, the gap has to close from one side or the other. Shares fell about 7 percent in premarket trading on November 3, then closed that day down 1.65 percent at $175.40 from the November 2 close of $178.34, and fell another 2.11 percent on November 4 to $171.70, roughly 3.7 percent across the two sessions, while the Nasdaq Composite rose on November 3.

What the guidance says about the next quarter

Management lifted its outlook with the results. Full-year 2026 revenue guidance moved to a range of $8.530 billion to $8.534 billion, up from the $8.150 billion to $8.158 billion range set with second-quarter results. That implies growth of about 91 percent for the year. US commercial revenue for 2026 is now expected to exceed $3.559 billion, growth of at least 143 percent.

For the fourth quarter, Palantir guided revenue of $2.649 billion to $2.653 billion, well ahead of the $2.46 billion estimate, implying sequential growth of about 15 percent against 20 percent in the third quarter. Adjusted free cash flow guidance rose to $4.8 billion to $5.0 billion.

Palantir expects the fourth quarter to be its biggest yet, with commercial demand still leading. The risk is that guidance reflects deals already in the pipeline, and the bookings slowdown suggests that pipeline may be thinner than the revenue line implies.

The valuation question

At the November 4 close, Palantir's market value was roughly $413.7 billion, about 48.5 times its full-year revenue guidance. Some market outlets put the forward price-to-earnings ratio near 230 after the report, against roughly 35 for the largest US tech stocks as a group. Those figures are simple arithmetic, not a judgment, but they explain why a record quarter still produced a selloff.

A stock priced for near-perfect execution has to keep delivering it. Palantir delivered on revenue, profit, and guidance, and still fell, because the one number that points to the future moved slowly. That is the tension under the company: growth faster than almost any large software peer, a price that assumes it lasts, and bookings that need to reaccelerate. The fourth quarter is the next test.

Frequently Asked Questions

How much revenue did Palantir report for Q3 2026?

Palantir reported $2.313 billion for the quarter ended September 30, 2026, up 96 percent year over year. It was the company's first quarter above $2 billion and beat the $2.18 billion Wall Street consensus.

Why did Palantir stock fall after a record quarter?

Shares fell because new bookings grew much more slowly than revenue: total contract value rose only 6 percent to $2.918 billion, and US commercial contract value rose 11 percent to $1.463 billion, down sharply from the second quarter's record pace.

What is Palantir's revenue guidance for the rest of 2026?

Palantir raised full-year 2026 guidance to $8.530 billion to $8.534 billion and guided fourth-quarter revenue of $2.649 billion to $2.653 billion, above the $2.46 billion consensus. US commercial revenue for the year is expected to exceed $3.559 billion.