Palantir’s Q4 2024: $5.43B in Contract Value

Palantir’s Q4 2024 performance has been nothing short of extraordinary, with actual growth numbers that underline its dual strength in government and commercial markets. In this review, EasyAssetManagement breaks down the remarkable gains achieved over the quarter and the year.

• Palantir’s U.S. revenue shot up 52% year-over-year, with both government and commercial sectors beating expectations.
• Secured a 4-year contract extension with the U.S. Army and expanded international government deals by 56%, solidifying long-term growth.
• Added 82 new customers and closed 32 deals over $10 million, proving strong demand for its AI platforms like Gotham and Foundry.
  
• Bonus: Did you know that Palantir is a holding in EasyETFs' AI World Actively Managed ETF?

Over the past year, the company has demonstrated exceptional growth across its segments:

• U.S. revenue rose by 52% year-over-year (Y/Y).
• Commercial revenue beat estimates by 3.5%, while government revenue beat estimates by 7%.
• U.S. commercial revenue outpaced expectations, growing robustly and contributing to an overall remarkable performance.

Government Wins: A Powerhouse of Long-Term Growth
The government segment has been a cornerstone of Palantir’s success. In Q4, government revenue not only beat estimates by 7% but also saw tremendous contract growth that bodes well for long-term stability. One of the standout achievements this quarter was with the US Army.

US Army Extended Contract
A major highlight was the US Army’s decision to extend its contract. The Army added four more years to its Army Vantage contract, ensuring that Palantir’s automated data analytics remain integral to its operations. This long-term win solidifies Palantir’s reputation as a critical technology partner for national defense and further underlines the company’s leadership in government analytics.

International and Domestic Government Success
International government business also saw impressive numbers, with total contract value (TCV) for international government rising 56% year-over-year. In the UK, for example, Palantir’s Federated Data Platform (FDP) now supports analytics and decision-making across 87 hospitals and 28 care providers, contributing to 26% quarter-over-quarter (Q/Q) international government growth.

CTO Shyam Sankar summed up the government opportunity with a bold declaration:

“Palantir's real competition is a lack of accountability in government. It's these forever software projects that cost an insane amount and don't actually deliver results. And I think DOGE is going to bring meritocracy and transparency to government, and that's exactly what our commercial business is.”

This full-length quote not only captures Palantir’s vision for government efficiency but also highlights the company’s commitment to revolutionizing public sector technology.

Commercial Wins: Record Deals and Expanding Customer Base
The commercial segment has been on an accelerated growth trajectory as well. U.S. commercial revenue outperformed by 7.5%, contributing to an overall U.S. revenue surge of 52% Y/Y. Key commercial wins include impressive deal metrics that signal strong demand and customer confidence in Palantir’s technology.

Notable Commercial Metrics

• Customer Growth: Palantir added 82 new customers this quarter, far exceeding the 36 that were expected.
• Deal Volume: The company closed 129 deals worth $1 million each (up from 104 Q/Q), 58 deals at $5 million (compared to 36), and 32 deals at $10 million (versus 16).
• Contract Value: Total contract value (TCV) booked rose 42% year-over-year, while remaining deal value (RDV) increased 40% year-over-year to $5.43 billion.
• Billing and RPO: Billings outpaced estimates by 2.5%, and remaining performance obligation (RPO) beat expectations by 13%.

These numbers are a testament to Palantir’s ability to attract new business and expand its footprint among existing customers. CEO Alex Karp captured this momentum in his remarks:

“We are still in the earliest stages, the beginning of the first act, of a revolution that will play out over years and decades… This is not an incremental advance or marginal acceleration of our business. This is a new phase… The business we have built has now developed its own internal momentum and strength… with the output that we are seeing far surpassing what we are investing. A software juggernaut has indeed emerged. .. We have the products and reach of an established incumbent and the speed, growth, and agility of an insurgent startup.”

This full-length statement from Karp perfectly encapsulates the breakthrough growth and renewed energy driving the company forward.

AIP and the Future of AI-Driven Operations
Central to both government and commercial wins is Palantir’s Artificial Intelligence Platform (AIP). The platform is redefining how organizations deploy and derive value from GenAI models. Rather than simply building the largest model, Palantir focuses on creating the tools and integrations that enable clients to build highly customized applications—tailored to their unique needs.

Chief Revenue Officer Ryan Taylor emphasized the impact of AIP:

“It's a substantial leap to deploy LLMs into production with real impact. Most organizations are currently stuck on the wrong side of the widening chasm, working on their 2, 5 & 10-year plans, which become obsolete days later. Not Palantir… We've taken our position through our decades-long investment in developing the ontology, which allows organizations to seamlessly weave LLMs into their enterprise, unlocking their highest potential leverage. In this AI revolution, anyone looking for a solution that actually works is going to choose Palantir.”

This comprehensive quote highlights how AIP is fueling tangible results—from reducing task times to unlocking significant cost savings and revenue opportunities. Across industries, case studies abound: from the US Army’s improved data processing speeds to Lowe’s cutting its overdue task rate by 75%, and General Mills saving $14 million annually.

CTO Shyam Sankar also reinforced the company’s innovative approach:

“We are convinced the normative value for AI is enterprise autonomy, the self-driving company. Users go from performing the workflow to supervising an army of agents, teaching them how to handle edge cases and reducing dwell time. This is where we are maniacally focused with our customers.”

This full-length insight from Sankar speaks to the core of Palantir’s strategy—empowering clients to transition from manual processes to automated, AI-driven operations.

Conclusion: A Dual Triumph of Government and Commercial Growth
Palantir’s Q4 2024 earnings report is a powerful demonstration of its dual-engine growth strategy. With the US Army’s four-year extension reinforcing its critical role in national defense and record-breaking commercial wins driving substantial revenue increases, the company is setting new benchmarks for performance.

As the numbers speak for themselves—52% U.S. revenue growth Y/Y, 42% increase in TCV, and 82 new customers added—Palantir’s story is one of innovation, relentless execution, and transformative impact. CEO Alex Karp, Chief Revenue Officer Ryan Taylor, and CTO Shyam Sankar leave no doubt: Palantir is not just riding the AI revolution; it is actively defining it.

For those watching the evolution of enterprise technology and AI integration, Palantir’s achievements in Q4 2024 offer a compelling glimpse into the future of data-driven decision-making and operational excellence. This certainly is an expensive stock and this needs to be kept in mind together with its remarkable results.

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