Summary
Palantir Technologies reported first quarter fiscal 2025 revenue of $883.86 million, up 39.3% from $634.34 million in the prior-year quarter. Gross profit rose 37.2% to $710.88 million from $518.08 million. Gross margin slipped to 80.4% from 81.7%, a decline of 1.2 percentage points. Operating income increased 117.7% to $176.05 million from $80.88 million, and operating margin expanded to 19.9% from 12.8%, up 7.2 percentage points. Net income rose 102.8% to $214.03 million from $105.53 million. Diluted earnings per share were $0.08, up from $0.04. Operating cash flow climbed 139.4% to $310.26 million from $129.58 million. Capital expenditures were $6.18 million, up from $2.66 million. Deferred revenue increased 23.1% to $587.50 million from $477.20 million. Remaining performance obligations rose 46.2% to $1.90 billion from $1.30 billion.
Operational momentum showed in customer counts and large deal activity. The company ended the quarter with 769 customers, up from 554 a year earlier. It closed 139 deals of at least $1 million, 51 deals of at least $5 million, and 31 deals of at least $10 million. U.S. commercial total contract value reached its highest quarterly level at $810 million, up 183% year over year. U.S. commercial remaining deal value was $2.32 billion, up 127% year over year and 30% quarter over quarter. Non-GAAP profitability was also strong. Adjusted income from operations was $391 million, a 44% margin, up from a 36% margin a year earlier. Adjusted free cash flow was $370 million, a 42% margin, compared with a 23% margin a year earlier. Adjusted EBITDA was $397 million, a 45% margin. Adjusted net income attributable to common stockholders was $334 million. Adjusted earnings per share was $0.13. The Rule of 40 score reached 83%. Contribution margin was 61%, compared with 60% a year earlier.
Guidance pointed to continued growth. For the second quarter of fiscal 2025, management guided adjusted income from operations to between $401 million and $405 million. For the full fiscal year 2025, the company raised its revenue guidance and now expects 36% growth. It also raised U.S. commercial revenue guidance to a growth rate of at least 68%. Full-year adjusted income from operations guidance is between $1.711 billion and $1.723 billion, and adjusted free cash flow guidance is between $1.6 billion and $1.8 billion. Management continues to expect GAAP operating income and net income in each quarter of the year.
Risks remain tied to the company's government exposure and contract structure. Large government customers face uncertainties around budgets, spending levels, timing, and regulatory or policy changes. Many customer contracts include termination for convenience provisions, and the sales cycle is long and unpredictable. Macroeconomic and geopolitical tensions, including the ongoing Russia-Ukraine conflict and Israel and broader Middle East conflicts, could disrupt customers and operations. Foreign currency fluctuations, tariffs, and trade relation changes also pose risks. The company also flags issues related to artificial intelligence in its platforms and any breach or access to customer or third-party data. The company depends on its ability to retain and expand its customer base, to develop and deploy new technologies, and to execute its channel sales and strategic initiatives with third parties. It also notes risks from the fluctuation of results on a quarterly basis and seasonality of its business.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2025 | Q4 FY2024 | QoQ | Q1 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $883.9M | $827.5M | +6.8% | $634.3M | +39.3% |
| Gross profit | $710.9M | $653.0M | +8.9% | $518.1M | +37.2% |
| Gross margin | 80.4% | 78.9% | +1.5 pp | 81.7% | -1.2 pp |
| Research & development | $134.9M | $171.5M | -21.3% | $110.0M | +22.6% |
| Sales & marketing | $236.3M | $288.3M | -18.0% | $193.2M | +22.3% |
| General & administrative | $163.6M | $182.1M | -10.2% | $134.0M | +22.1% |
| Total operating expenses | $534.8M | $641.9M | -16.7% | $437.2M | +22.3% |
| Operating income (loss) | $176.0M | $11.0M | +1494.2% | $80.9M | +117.7% |
| Operating margin | 19.9% | 1.3% | +18.6 pp | 12.8% | +7.2 pp |
| Net income (loss) | $214.0M | $79.0M | +170.9% | $105.5M | +102.8% |
| Net margin | 24.2% | 9.6% | +14.7 pp | 16.6% | +7.6 pp |
| Diluted EPS | $0.08 | $0.03 | +$0.05 | $0.04 | +$0.04 |
| Customers | 769 | — | — | 554 | +38.8% |
Risks
The top three customers together accounted for 18% and 17% of revenue for the three months ended March 31, 2025 and 2024, respectively. Certain significant customers have reduced spend or terminated agreements, requiring refunds of previously paid amounts.
Sales efforts involve considerable time and expense, with a sales cycle that often lasts six to nine months but can extend to a year or more. The company also runs no or low cost pilot deployments and bootcamps that may not convert to revenue-generating contracts.
For the three months ended March 31, 2025, 55% of revenue came from government customers. Many contracts permit termination for convenience, and the U.S. federal government cannot exercise contract options more than one year in advance, exposing revenue to budget delays, continuing resolutions, and award timing.
The filing states that Palantir and its peers are investing more significantly in AI, and other companies may develop similar products or adopt and implement AI more successfully or at a quicker pace. This could limit market acceptance of AIP and other platform enhancements.
The company is highly dependent on CEO Alexander Karp and key personnel, and all executive officers and many key personnel are at-will employees. It had 4,001 full-time employees as of March 31, 2025 and may face difficulty hiring, retaining, and training qualified staff, including personnel needing security clearances.
Customers may defer, reduce, or forgo purchases due to inflation, heightened interest rates, monetary policy changes, foreign currency fluctuations, tariffs, trade relations, and geopolitical conflicts. MD&A states current macroeconomic conditions have impacted and may continue to adversely impact new customer acquisition, renewals, and collections.
The business is subject to complex and evolving U.S. and non-U.S. laws on privacy, data protection, technology protection, and AI, including the EU AI Act and FASA. Legal, regulatory, and administrative proceedings could produce unfavorable outcomes.
The multi-class structure, Founder Voting Trust Agreement, and Founder Voting Agreement concentrate voting power with the Founders. This can give the Founders voting power substantially greater than their economic interests and may cause conflicts or reduce appeal to certain institutional investors.
SaaS KPIs
All quarters →Adjusted Operating Margin
Adjusted Free Cash Flow Margin
Adjusted free cash flow
Adjusted income from operations
Adjusted EBITDA Margin
Adjusted EBITDA
Contribution Margin
Rule of 40
Customer count growth (YoY)
Deals of at least $1 million
Deals of at least $10 million
Deals of at least $5 million
Customer count growth (QoQ)
U.S. Commercial Remaining Deal Value (RDV)
Adjusted EPS, diluted
U.S. Commercial Total Contract Value (TCV)
Adjusted net income attributable to common stockholders
Summary, forecast, risks and KPIs are extracted from Palantir Technologies Inc.'s SEC filings for Q1 FY2025 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.