Summary
Palantir's FY2021 Q4 revenue reached $432.87 million, up 34.4% from the prior-year quarter. Commercial revenue rose 47% and government revenue rose 26%. US commercial revenue jumped 132%. The company added 34 net new customers in the quarter. It closed 64 deals worth $1 million or more, and that count included 27 deals of $5 million or more and 19 deals of $10 million or more.
Gross profit was $345.30 million in the quarter, up 37.2%, and gross margin was 79.8%, up 1.7 percentage points from the prior-year quarter. The operating loss was $58.94 million and narrowed compared with the prior-year quarter. Operating margin came in at negative 13.6%, up 35.0 percentage points. Net loss was $156.19 million, down 5.3% from the prior-year quarter as the loss widened. Adjusted income from operations was $124 million in the quarter, a 29% margin.
On a full-year basis, revenue was $1.54 billion, up 41.1%. The full-year net loss narrowed to $520.38 million. GAAP diluted EPS for the full year was negative $0.27. US revenue grew 53%, commercial revenue grew 34%, and government revenue grew 47%. Commercial customer count tripled to 147, and US commercial customer count increased 4.7x to 80. Total net dollar retention was 131%, with US commercial at 150% and government at 146%. Adjusted income from operations for the full year was $473.5 million, a 31% margin.
The cohort disclosures show how the account model is playing out. Customers classed in the Acquire phase at the end of 2020 generated $0.3 million that year and a contribution loss of $36.8 million. In 2021 those same customers produced $45.1 million of revenue and a contribution profit of $7.2 million. Expand phase customers went from $20.3 million of revenue at a negative 159% contribution margin in 2020 to $83.3 million at a 45% margin in 2021. Scale phase customers generated $1.1 billion in 2020 and $1.3 billion in 2021, at a 63% contribution margin in both years. Customers acquired during 2021 added $83.9 million in revenue. Contribution margin across the business was 58% in 2021 against 54% in 2020.
Cash generation improved sharply. Q4 operating cash flow was $93.43 million, up 610.9% from the prior-year quarter. Full-year operating cash flow was $333.85 million, up 212.6%. Adjusted free cash flow was $104 million in Q4, a 24% margin, and $424 million for the full year, a 28% margin. Capital expenditures were $5.84 million in the quarter, up 22.7%. Deferred revenue was $463.30 million, down 12.9% from the prior-year quarter. Remaining performance obligations were $1.10 billion, up 84.1%. Total remaining deal value was $3.8 billion, up 35%, split between $2.6 billion of commercial value, up 71%, and $1.2 billion of government value, down 6%. Management left out $2.8 billion of IDIQ awards where funding has not been determined. Approved investment commitments outstanding were $134.5 million.
Guidance points to more growth. For Q1 2022, management guided to $443 million in revenue and a 23% adjusted operating margin. For full-year 2022, the guidance is a 27% adjusted operating margin. The long-term policy still calls for annual revenue growth of 30% or greater through 2025. Risks include a long and unpredictable sales cycle, the need to retain and expand customers, and contracts that are often subject to termination for convenience. The US federal government cannot exercise contract options more than one year in advance. COVID-19 uncertainty remains, and the company said it may need to raise additional equity or debt financing.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2021 | Q3 FY2021 | QoQ | Q4 FY2020 | YoY |
|---|---|---|---|---|---|
| Revenue | $432.9M | $392.1M | +10.4% | $322.1M | +34.4% |
| Gross profit | $345.3M | $305.3M | +13.1% | $251.6M | +37.2% |
| Gross margin | 79.8% | 77.9% | +1.9 pp | 78.1% | +1.7 pp |
| Research & development | $84.2M | $94.3M | -10.8% | $94.1M | -10.6% |
| Sales & marketing | $162.6M | $153.4M | +6.0% | $147.6M | +10.1% |
| General & administrative | $157.5M | $149.5M | +5.3% | $166.4M | -5.4% |
| Total operating expenses | $404.2M | $397.3M | +1.8% | $408.2M | -1.0% |
| Operating income (loss) | -$58.9M | -$91.9M | +35.9% | -$156.6M | +62.4% |
| Operating margin | -13.6% | -23.4% | +9.8 pp | -48.6% | +35.0 pp |
| Net income (loss) | -$156.2M | -$102.1M | -52.9% | -$148.3M | -5.3% |
| Net margin | -36.1% | -26.1% | -10.0 pp | -46.1% | +10.0 pp |
| Diluted EPS | -$0.08 | -$0.05 | -$0.03 | -$0.15 | +$0.07 |
Risks
Government customers generated 58% of revenue for the year ended December 31, 2021, and the top three customers accounted for 18% of 2021 revenue. Many contracts are subject to termination for convenience, the U.S. federal government cannot exercise options more than one year in advance, and $2.8 billion of IDIQ awards as of December 31, 2021 were excluded from remaining deal value because funding was not guaranteed.
Total remaining deal value was $3.8 billion as of December 31, 2021, up 35% from December 31, 2020, but government remaining deal value was $1.2 billion, down 6% from December 31, 2020. The company historically has not realized all revenue from full deal value due to option exercise, termination, and renegotiation risks.
Sales efforts are time-intensive and the sales cycle often lasts six to nine months and can extend to a year or more for some customers. The company often provides platforms at no or low cost in pilot deployments, and failure to convert Acquire phase customers into later phases could leave significant upfront investment without sufficient revenue.
The company has incurred losses each year since inception, and net loss widened to $156.2 million in FY2021 Q4 from $148.3 million in FY2020 Q4, a 5.3% increase in the loss. Stock-based compensation was $778.2 million for the year ended December 31, 2021, and MD&A highlights adjusted income from operations of $473.5 million excluding stock-based compensation and related items.
The multi-class structure, Founder Voting Trust Agreement, and Founder Voting Agreement concentrate voting power with the Founders and their affiliates. This structure could make Class A common stock ineligible for certain indices and may depress valuation compared with similar companies.
The company faces intense competition from large enterprise software companies, government contractors, system integrators, and emerging companies, some of which may sell at zero or negative margins, bundle products, or offer closed platforms. Its platforms also use artificial intelligence, and issues raised by AI use may result in reputational harm or liability.
Average revenue per customer for the trailing twelve months ended December 31, 2021 was $6.5 million, down 18% from $7.9 million for the year ended December 31, 2020, as the company expands access to early- and growth-stage companies. This customer mix shift could pressure future revenue growth even as total revenue grew 41% for the year ended December 31, 2021.
The company has made and may continue to make strategic investments, including in privately held and publicly traded companies and alternative investments. As of December 31, 2021, approved investment commitments outstanding totaled $134.5 million, and other income (expense), net changed by $79.5 million for the year ended December 31, 2021 compared with 2020 primarily due to unrealized losses on marketable securities.
As of December 31, 2021, the company was required to comply with Section 404 of the Sarbanes-Oxley Act and its auditor formally attested to internal control over financial reporting for the first time in this Form 10-K. The company recently reimplemented its ERP system and has limited accounting and financial reporting personnel, which could impair timely or accurate financial reporting.
The company is highly dependent on Alexander Karp, its CEO, and other key personnel, and all executive officers and many key employees are at-will. Difficulty hiring or retaining personnel, including due to equity award value or immigration restrictions, could delay product development or reduce sales.
Deferred revenue was $463.3 million in FY2021 Q4, down 12.9% from FY2020 Q4. MD&A states operating cash flow was affected by an $80.2 million decrease related to deferred revenue and customer deposits, and many contracts permit termination for convenience or refunds of customer deposits.
SaaS KPIs
All quarters →Adjusted Operating Margin
Adjusted Free Cash Flow Margin
Adjusted free cash flow
Adjusted income from operations
Adjusted EBITDA Margin
Total Customers
Adjusted EBITDA
Total remaining deal value
Summary, forecast, risks and KPIs are extracted from Palantir Technologies Inc.'s SEC filings for Q4 FY2021 (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.