⚡What does Palantir do, in 30 seconds?
Palantir sells software that helps governments and companies pull their data together and act on it, including with AI 2 2 2. It took in $4.5bn ✓ in FY2025. Government customers gave 54% ✓ of that, and businesses gave the rest.
📱What does Palantir sell?
Palantir reports two business lines: Government and Commercial 4. Many government customers use Foundry, the same platform businesses use 2. Here is what each one is and who buys it.
Government
Software for US and other government agencies. In FY2025 it brought in $2.4bn ✓. Its Gotham platform joins data from many sources and sensors so users can see a situation, plan missions and carry them out 2. In March 2026, the Pentagon began moving Palantir's Maven Smart System to an official program of record 3.
👥 US and other government agencies 4, including defense and intelligence users 2.
Commercial
Software for businesses. In FY2025 it brought in $2.1bn ✓. Every commercial customer uses Foundry, Palantir's core data platform for joining data, running analysis and building apps 2. AIP, its AI platform, links large language models made by other firms to a customer's own data 2.
👥 Businesses in industries outside government 4.
How the mix has shifted
💸How does Palantir make money?
Follow the money from left to rightfrom top to bottom: what customers pay for, what it costs to make, and what is left as profit.
Palantir took in $4.5bn ✓ of revenue in FY2025. Running its software for customers cost $0.8bn ✓. What is left is gross profit, the money kept after paying for what was sold. That came to $3.7bn ✓.
Next come the costs of running the company. Research and development took $0.6bn ✓, and sales, marketing and admin took $1.7bn ✓. What remains is operating profit, the profit from the main business, which was $1.4bn ✓. Interest and other income added $0.2bn ✓, and tax was tiny. So net income was $1.6bn ✓. Out of every hundred dollars of revenue, Palantir kept about $36 ✓ as profit.
Out of every $100 customers paid in FY2025…
Interest, investment gains and other income added +$5 for every $100 of sales, so the slices above add up to a little more than $100.
⏱️ Palantir by the clock
Spread the FY2025 totals evenly over its 365 days and you get this. Source: Palantir Technologies Inc. 10-K [5].
📈How is Palantir doing?
Palantir is growing very fast and has turned solidly profitable. Revenue grew 33.4% ✓ a year on average from FY2018 to FY2025. It rose in all 7 ✓ of those 7 ✓ years. Operating margin jumped from -104.7% ✓ in FY2018 to 31.6% ✓ in FY2025.
The latest four quarters, to 30 June 2026, look even stronger. Revenue reached $6.2bn ✓, up 78.9% ✓ on the four quarters before. Operating margin climbed to 42.8% ✓. In August 2026, Palantir raised its 2026 revenue outlook to $8.150 billion to $8.158 billion 3326. That is a forecast, not a result.
📝 The report card
Palantir earns top marks for growth, cash and its balance sheet, a middling mark for profit and a weak mark for steadiness. Every company is graded on the same fixed scale, so an A means the same thing on every page. The strip shows where Palantir (orange) and its 4 peers land; further right is better.
Growth
Palantir's revenue grew 32.9% ✓ a year over its last three fiscal years, which earns an A ✓. That is the fastest in its peer group. Microsoft grew 16.1% ✓ a year, also an A ✓.
Why this measure? (higher is better)
Growing sales is the engine of a business. Mature giants rarely grow fast, so 5% a year already earns a C.
Profitability
Over the last three years combined, Palantir kept 19.3% ✓ of revenue as operating profit, which earns a C ✓. The early years drag this down, since its margin was only 5.4% ✓ in FY2023. Microsoft kept 45.8% ✓, an A ✓.
Why this measure? (higher is better)
Operating margin is the share of each sales dollar left after running the business. Software and platforms often clear 30%; hardware makers usually sit below 10%.
Cash generation
Over the last three years combined, Palantir turned 41.2% ✓ of revenue into free cash flow, an easy A ✓. That beats every peer here. Salesforce came next at 31.8% ✓.
Why this measure? (higher is better)
Free cash flow is the cash left after paying for factories, data centres and equipment. It funds dividends, buybacks and new bets.
Balance sheet
At the end of FY2025, Palantir's cash and investments minus its borrowings (leases and stakes in other companies not counted) equalled 160.4% ✓ of a year's revenue. That earns an A ✓. Its total debt was $0.0bn ✓. Oracle's net cash came to -145.8% ✓ of a year's revenue, an F ✓.
Why this measure? (higher is better)
More cash than debt gives a company room to ride out bad years. Some debt is normal; a lot of it makes a company fragile.
Steadiness
Palantir's yearly growth rates swing a lot: how much its yearly growth rate moves around comes to 14.3% ✓, which earns a D ✓. Growth went from 16.7% ✓ in FY2023 to 56.2% ✓ in FY2025. Fast speed-ups count as swings too.
Why this measure? (lower is better)
Steady growers are easier to plan around. Big swings mean sales depend on product cycles, the economy or one-off events.
🧑🏫 How the grades work
- Same scale for everyone. Each measure has fixed cut-offs (shown under each strip). Clear the A line and you get an A, whatever your peers do.
- Three years together. Profitability and cash generation add up the last three fiscal years before dividing, so one unusual year counts for less than it would on its own (a year much bigger than the others still weighs most).
- Peers for context. The rank shows how Palantir compares with the group. Companies within 0.1 percentage point share a rank.
- Same source. Every company's figures come from its own latest annual report (10-K), so fiscal years end in different months.
- Judgement, openly stated. The cut-offs are QuantVantage.ai's view of what good looks like for a large, established company. They are not a forecast or a recommendation.
8 years at a glance
Where the cash goes
Palantir has kept almost all of its cash. From FY2018 to FY2025 it made $3.9bn ✓ of free cash flow and spent only $0.2bn ✓ on buybacks. In FY2025, buybacks took just 4% ✓ of free cash flow. Palantir ended its buyback program in January 2026 30.
🧮Ratios 101: what are Palantir's key financial ratios?
Ratios turn Palantir's numbers into easy comparisons, and a few stand out because it holds lots of cash and pays a lot in stock. A ratio divides one number by another so companies of any size can be compared. Each card shows the formula with Palantir's real FY2025 numbers, the peer median and the trend.
💰 Profitability: how much of each sale is kept?
Gross margin
What is left from each sale after paying to make the product or deliver the service.
👉 At 82.4% ✓, up from 72.2% ✓ in FY2018, Palantir keeps more of each dollar than the 66.9% ✓ peer median.
📏 Rule of thumb: Above 40% usually signals pricing power or a big software or services mix.
Operating margin
What is left after also paying for research, marketing and running the company.
👉 Palantir's 31.6% ✓ beats the 25.3% ✓ peer median, a huge swing from -104.7% ✓ in FY2018.
📏 Rule of thumb: Above 20% is strong for a large company.
Net margin
The bottom line: profit after interest and taxes, per dollar of sales.
👉 Palantir keeps 36.3% ✓ of revenue as final profit, above the 21.7% ✓ peer median. Interest and other income lift it above operating margin.
📏 Rule of thumb: Above 15% is strong; one-off tax items can move it in a single year.
Return on equity (ROE)
Profit earned for each dollar that shareholders have left in the company.
👉 ROE of 22.0% ✓ is below the 31.3% ✓ peer median. Palantir has kept most of its cash, which leaves it with a large base of $7.4bn ✓ of equity.
📏 Rule of thumb: Around 15% or more is good, but buybacks shrink equity and can make ROE look huge.
⚙️ Efficiency: how hard do the assets work?
Return on assets (ROA)
Profit earned from everything the company owns, however it was paid for.
👉 ROA of 18.3% ✓ is well above the 6.8% ✓ peer median, and up from -36.4% ✓ in FY2019.
📏 Rule of thumb: Above 10% is strong; banks and factories usually earn less.
Asset turnover
Dollars of sales squeezed out of each dollar of assets.
👉 Palantir's revenue is 0.5x ✓ the value of everything it owns, the same as in FY2019 and near the 0.4x ✓ peer median.
📏 Rule of thumb: Retailers often top 2x; asset-heavy businesses can sit below 0.5x.
🛟 Safety: could it survive a bad year?
Current ratio
Can short-term assets (cash, money owed by customers, stock) pay the bills due within a year?
👉 At 7.1x ✓, Palantir's short-term assets far exceed its bills due within a year, against a 1.0x ✓ peer median.
📏 Rule of thumb: Above 1.0x is the classic comfort line, but cash-rich giants can run below it on purpose.
Debt to equity
How much the company has borrowed for each dollar shareholders have in it.
👉 Palantir's 0.0x ✓ compares with a 1.1x ✓ peer median, as its total debt was $0.0bn ✓ in FY2025.
📏 Rule of thumb: Below 1.0x is conservative. Like ROE, it can rise when buybacks shrink equity, even if debt has not changed.
💵 Cash and owners: where does the money end up?
Cash conversion
Does reported profit turn into real cash? Free cash flow is operating cash minus capital spending.
👉 Palantir turns profit into cash at 1.3x ✓, above the 0.8x ✓ peer median.
📏 Rule of thumb: Near or above 1.0x means profits are backed by cash.
R&D intensity
How much of each sales dollar goes into inventing future products.
👉 Palantir spends 12.5% ✓ of revenue on R&D, close to the 13.4% ✓ peer median and down from 47.9% ✓ in FY2018 as revenue grew.
📏 Rule of thumb: Tech companies often spend 10% to 20%; more is not always better if it does not pay off.
Stock pay
Pay given to staff in shares instead of cash. It is a real cost to owners because it adds shares.
👉 Stock pay is 15.3% ✓ of revenue, nearly three times the 5.4% ✓ peer median, though down from 41.7% ✓ in FY2018.
📏 Rule of thumb: Under 5% of sales is modest for a tech company.
Shareholder payout
How much of the year's profit was handed back to owners.
👉 Palantir paid out only 4.6% ✓ of FY2025 profit, against a 47.7% ✓ peer median.
📏 Rule of thumb: Above 100% means it returned more than it earned, using cash savings or debt.
Ratios use fiscal-year-end balance sheet values. Inputs are shown rounded, so dividing them can differ from the result in the last digit. A peer median leaves out peers that do not report the inputs, or where the ratio means nothing (for example, negative shareholders' equity). Rules of thumb are general guides from QuantVantage.ai, not hard limits. No share-price ratios (like price-to-earnings) are shown on this page.
🥊Who are Palantir's competitors?
Palantir competes with big software and cloud companies, and it also partners with several of them 910 111213 161718. Microsoft, Oracle, Salesforce and IBM all sell data or AI software to businesses or governments.
| Company | Where they compete | Revenue | Growth/yr (3y) | Op. margin | FCF margin |
|---|---|---|---|---|---|
| Palantir (PLTR, FY2025) | Data and AI software for governments and businesses | $4.5bn | 32.9% | 31.6% | 46.9% |
| Microsoft (MSFT, FY2026) | Cloud software for data and AI; also a partner on Azure Government clouds 910 | $331.8bn | 16.1% | 46.8% | 20.2% |
| Oracle (ORCL, FY2026) | Cloud and AI software; the two became partners in April 2024 111213 | $67.4bn | 10.5% | 30.6% | -35.2% |
| Salesforce (CRM, FY2026) | Platforms for building AI agents and workflows on company data 1415 | $41.5bn | 9.8% | 20.1% | 34.7% |
| IBM (IBM, FY2025) | Hybrid cloud, AI software and consulting; the two partnered in 2021 161718 | $67.5bn | 3.7% | 17.8% | 17.9% |
Palantir says its main competitor is customers' own in-house software efforts 17. It also names large software companies and system integrators among its rivals 161718.
🧭Palantir SWOT: strengths, weaknesses, opportunities and threats
💪 Strengths
- Over the last three years combined, Palantir turned 41.2% ✓ of revenue into free cash flow, an A ✓ on our report card.
- Its top three customers made up 16% of 2025 revenue and had stayed for ten years on average 20.
- Total remaining deal value was $11.2 billion at 31 December 2025, up 105% in a year 21.
- Palantir holds US government security approvals up to Impact Level 6 20.
🩹 Weaknesses
- Stock pay was 15.3% ✓ of revenue in FY2025, far above the 5.4% ✓ peer median.
- Palantir says it depends heavily on CEO Alexander Karp, who would be hard to replace 20.
- The three founders control voting through special Class F shares 24.
- US customers gave 80% of revenue in the first half of 2026 25. Palantir warns this raises its exposure to a weak US economy 25.
🚀 Opportunities
- US commercial revenue grew 149% in the second quarter of 2026 26.
- Palantir expects 2026 US commercial revenue above $3.424 billion 26.
- Its government figures leave out contract awards worth $12.3 billion at 31 December 2025, whose funding was not yet set or guaranteed 21.
- Palantir is building industry operating systems with partners in fields such as airlines and healthcare 22.
⚠️ Threats
- Many of Palantir's contracts can be ended early for convenience 21.
- Some rivals have more name recognition and far greater money and technical resources, Palantir says 17.
- Palantir warns that activist criticism or bad news coverage about its customers could hurt its reputation 20.
- The US government may not take up contract options more than one year ahead 21.
🏰Does Palantir have a moat?
Why 4?
Palantir's platforms center on the Ontology, a shared model linking an organization's data, logic and actions 2. Its top three customers had stayed ten years on average 20. Palantir expects 2025 deals to bring revenue for about four more years, though many of its contracts can be ended early 21.
A moat is what keeps rivals from taking a company's customers and profits. Scores are QuantVantage.ai's judgement (5 = strongest), set with the same rubric on every explainer (orange is Palantir; grey dots are peers).
🔭What should you watch next?
US commercial growth
Palantir expects US commercial revenue to grow at least 134% in 2026 26.
📚Learn the words
❓Frequently asked questions about Palantir
How does Palantir make money?
Palantir makes money by charging customers to use its software, usually on contracts of one to five years 21. In FY2025, government customers paid $2.4bn ✓ and businesses paid $2.1bn ✓.
Does Palantir sell people's data?
Palantir says it is not in the business of collecting, mining or selling data 2. Its software lets customers work with their own data 2.
What are Gotham, Foundry and AIP?
They are Palantir's main software platforms. Gotham is for defense and intelligence work 2. Foundry is its core data platform 2. AIP links outside AI models to a customer's own data 2.
Is Palantir profitable?
Yes, Palantir is profitable. Net income was $1.6bn ✓ in FY2025 and $3.0bn ✓ in the four quarters to June 2026. Back in FY2018, its operating margin was -104.7% ✓.
How many customers does Palantir have?
Palantir had 1,049 customers in the 12 months to 30 June 2026, up from 849 a year earlier 25. It counts each government agency with its own contract as a separate customer 21.
Who runs Palantir?
Co-founder Alexander Karp has been CEO since 2005 28. Co-founder Peter Thiel chairs the board, and co-founder Stephen Cohen is President 28.
🎮Play: higher or lower, then test yourself
Figures come from each company's latest annual report (10-K); fiscal years end in different months. Sources: [5] [6] [8] [7] [19].
🧠 Test yourself
5 quick questions. Score: 0 / 5
1. What does Palantir say is its main competitor?
2. About how much of Palantir's FY2025 revenue came from government customers?
3. How much profit did Palantir make every second in FY2025?
4. What is the Ontology?
5. What did the US Army choose Palantir to build in March 2024?
🔎Sources and method
Every figure comes from a source listed here or is calculated from those sources (marked ✓). Company financials are taken from SEC filings (10-K and 10-Q) as tagged in XBRL. Peer grades rank the same measures across the company and its peers. This page contains no share-price data and no valuation.
- Palantir (PLTR) Form 10-K for fiscal year 2025, filed 2026-02-17 — revenue by product, segment and geography (accessed 2026-10-28)
- Palantir Form 10-K for fiscal year 2025 — Item 1 overview: founding, platforms (Gotham, Foundry, AIP, Apollo), Ontology, privacy approach (accessed 2026-10-29)
- DefenseScoop: Pentagon memo on Palantir's Maven Smart System (April 3, 2026) — March 9, 2026 memo making Maven Smart System a program of record (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 7 segment discussion: commercial and government segment definitions (accessed 2026-10-29)
- SEC EDGAR companyfacts: Palantir (PLTR) — annual 10-K facts (accessed 2026-10-28)
- SEC EDGAR companyfacts: MICROSOFT CORP (MSFT) — annual 10-K facts (accessed 2026-10-28)
- SEC EDGAR companyfacts: Salesforce, Inc. (CRM) — annual 10-K facts (accessed 2026-10-28)
- SEC EDGAR companyfacts: ORACLE CORP (ORCL) — annual 10-K facts (accessed 2026-10-28)
- Microsoft Form 10-K for fiscal year 2026 — Item 1 Intelligent Cloud: Azure cloud and AI services, Azure AI Foundry (accessed 2026-10-29)
- Microsoft News: Palantir and Microsoft partner to deliver analytics and AI services to classified networks (August 8, 2024) — Palantir products on Azure Government, Secret and Top Secret clouds (accessed 2026-10-29)
- Oracle Form 10-K for fiscal year 2026 — Item 1: cloud offerings sold to businesses and government agencies, OCI Sovereign Cloud (accessed 2026-10-29)
- Oracle press release: Oracle and Palantir join forces to deliver mission critical AI solutions (April 4, 2024) — Oracle and Palantir partnership terms (accessed 2026-10-29)
- DBTA: Oracle and Palantir partner to deliver mission critical AI solutions (April 2024) — Oracle and Palantir partnership terms (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 1: Foundry and AIP platforms; competition (accessed 2026-10-29)
- Salesforce Form 10-K for fiscal year 2026 (ended January 31, 2026) — Item 1 overview and service offerings (Sales, Service, Platform, Data 360, Informatica, Slack, Agentforce, Marketing, Commerce, Integration, Analytics, Industries); principal office (accessed 2026-10-29)
- IBM Form 10-K for fiscal year 2025 — Item 1: hybrid cloud and AI business; Software segment competitors (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 1 Competition and Intellectual Property (accessed 2026-10-29)
- IBM and Palantir partnership press release (February 8, 2021) — Palantir for IBM Cloud Pak for Data (accessed 2026-10-29)
- SEC EDGAR companyfacts: INTERNATIONAL BUSINESS MACHINES CORP (IBM) — annual 10-K facts (accessed 2026-10-28)
- Palantir Form 10-K for fiscal year 2025 — Item 1A risk factors: customer concentration, key personnel, public sector risks, government certifications, reputation, Army TITAN (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 7 overview: business model, contract terms, customers, U.S. revenue, contract duration, total remaining deal value, IDIQ awards (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 1 customer acquisition and sales: bootcamps, Developer Tier, industry operating systems, cloud and channel partners, account growth (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 7 non-GAAP reconciliations: contribution margin and stock-based compensation (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 1A risk factors: multi-class stock and founder voting (accessed 2026-10-29)
- Palantir Form 10-Q for the quarter ended June 30, 2026 — MD&A: customers, top twenty customers, government/commercial and U.S. revenue shares; risk factors: employees, U.S. exposure, reputation (accessed 2026-10-29)
- Palantir Q2 2026 results release (Form 8-K exhibit 99.1, August 3, 2026) — Q2 2026 revenue, U.S. revenue, contract value, Q3 and FY2026 outlook, Rule of 40 definition, CEO comment (accessed 2026-10-29)
- SEC EDGAR companyfacts: Palantir (PLTR) — quarterly 10-Q/10-K facts (accessed 2026-10-28)
- Palantir 2026 proxy statement (DEF 14A) — Director biographies: Karp, Thiel, Cohen (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 1 Our Customers: customer count, government/commercial revenue split, U.S. and non-U.S. revenue share, top twenty customers (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Item 5 and Note 9: share repurchase program (accessed 2026-10-29)
- Palantir Form 10-K for fiscal year 2025 — Cover page and Note 1: incorporation date, principal executive office address, former address, fiscal year end (accessed 2026-10-29)
- SEC EDGAR companyfacts: Palantir (PLTR) — balance sheet at 2026-06-30 (accessed 2026-10-28)
- Palantir Q4 and FY2025 results release (Form 8-K exhibit 99.1, February 2, 2026) — FY2025 and Q4 2025 revenue, U.S. government and U.S. commercial revenue, FY2026 outlook (accessed 2026-10-29)
- Palantir press release: date of third quarter 2026 earnings release and webcast (October 12, 2026) — Q3 2026 results date (accessed 2026-10-29)