The fast-growing software and data analytics firm Palantir Technologies [PLTR] expects its sales to grow at least 30 percent annually through 2025 driven by continued increases in government and commercial business.
Palantir reported a $101.4 million, 5 cents earnings per share (EPS), loss in the first quarter of 2022, down from a $123.5 million (7 cents EPS) loss a year ago. Sales in the quarter jumped 31 percent to $446.4 million from $341.2 million a year ago.
Work with the U.S. government accounted for 42 percent of all sales, a significant amount of which is with the Department of Defense. Palantir’s overall government work increased 16 percent in the quarter to $241 million and its commercial business soared 54 percent to $205 million. Work with U.S. commercial customers soared 136 percent in the quarter.
“We see a path to double U.S. commercial revenue for the third year in a row, growing to $400 million this year,” Alex Karp, Palantir’s CEO and co-founder, said in a letter to shareholders. He also said that international commercial growth is expected to show strength in “the near-term.”
The war in Ukraine has already boosted the company’s business.
“We have been continuously shipping innovation over the course of the conflict to provide Western militaries the software they need to fulfill their missions,” Shyam Sankar, Palantir’s chief operating officer, said during the company’s earnings call.
The company’s U.S. government work has begun to accelerate in the second quarter and will pick up in the second half of the year, Dave Glazer, Palantir’s chief financial officer, said on the call.
Palantir’s latest product, MetaConstellation, which integrates existing satellites to generate custom solutions for users, has been “delivering significant mission outcomes,” Sankar said. “And we have been working across Poland, Lithuania, the U.K., and other nations to power refugee relief operations. Our software is powering the world food programs, Ukraine response, getting aid as far east as possible.”
Sankar also said that Palantir’s software is helping commercial customers be resilient against “a whole new set of supply chain shocks.”
In the second quarter, the Denver-based company expects sales of at least $470 million with upside due to ongoing “geopolitical events,” it said.
Karp, in his shareholder letter, also opined that “The world significantly underestimates the threat of nuclear conflict in Eastern Europe.”