What does Palantir do?
Palantir is a software company that specializes in big data. Essentially, it allows its customers to operate on massive amounts of data in order to glean solutions and actionable insights. It has two main offerings: the Gotham platform, which specializes in government and defense contracts, and the Foundry platform, which has more commercial applications.
The company’s customers are predominantly governments, with 56% of the company’s total revenue in Q4 2020 coming from the public sector. Just last year, it penned a deal with the Department of Defense to provide research and development for the Army Research Laboratory worth $91 million, and it has said many organizations have been using Palantir in their response to COVID-19.
There is a significant amount of controversy around the business due to the nature of its work and its leadership. Co-founder Peter Thiel’s formerly close relationship with Donald Trump put him on the opposite end of the political spectrum to the rest of Silicon Valley, and the company found itself at odds with California’s innovation hub, so much so that it’s actually moving to Colorado. CEO Alex Karp has some scathing words on the divide: “The engineering elite of Silicon Valley may know more than most about building software,” Karp wrote. “But they do not know more about how society should be organized or what justice requires. Our company was founded in Silicon Valley. But we seem to share fewer and fewer of the technology sector’s values and commitments.”
Due to the nature of its business and the primary source of its revenue, it’s impossible to separate Palantir from politics, especially when its largest contracts involve emigration departments in the U.S. and U.K. However, with its stock up more than 120% since going public in September, this doesn’t seem to be an issue.
When will Palantir report its earnings?
Palantir reports its earnings for Q1 2021 on Wednesday, May 11th at 8:30AM Eastern Time.
How can I listen to Palantir’s earnings?
To listen to the call and to access the transcript, as well as the shareholder’s letter and the financial statements for the quarter, all you need to do is go to Palantir’s investor relations page.
What to expect from the call
With its relatively short life as a public company, the current estimates see revenues coming in at $333 million, implying 3.4% sequential growth, with earnings per share expected to be $0.04. This would represent a drop from Q4’s $0.07 per share.
In terms of the call itself, expect a lot of it to revolve around Palantir’s relationship with the U.S. government, and what plans, if any, will it have in dealing with a new Democratic presidency. You can also expect a lot of questions to fall into Palantir’s COVID work and how it plans to move forward when the virus is out of our lives.
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Michael's first and favorite stock is Square, which he sees becoming a massive player in the payments industry and a leader in the war on cash.