AI powerhouse Palantir has been one of the best performing stocks in the S&P 500 index in 2025. Year to date, it’s up around 150%1.
Earlier this week, the company posted its earnings for the third quarter2 of 2025 and they were very strong, signaling that demand for the company’s AI solutions remains high. Here’s a look at some highlights from the Q3 report, and Wall Street’s reaction to it.
Strong Top and Bottom-Line Growth
For the third quarter, Palantir’s revenue came in at $1.18 billion. This figure was up 63% year on year and ahead of the consensus forecast of $1.093 billion.
Breaking this top-line number down, US revenue grew 77% year over year to $883 million. Here, commercial revenue was up 121% to $397 million while government revenue was up 52% to $486 million.
In terms of profitability, Palantir’s adjusted income from operations was $601 million, representing a 51% margin. Meanwhile, adjusted earnings per share (EPS) was $0.21, up from $0.10 for the same period last year and ahead of the consensus estimate of $0.17.
Zooming in on the company’s “Rule of 40” score - which management always likes to highlight - this was an impressive 114.
Full-Year Guidance Raised
Looking ahead, the company raised its guidance for 2025. It now expects revenue of between $4.396 billion and $4.400 billion versus previous guidance4 of $4.142 billion to $4.150 billion.
Adjusted income from operations is now expected to be between $2.151 billion and $2.155 billion. Previous guidance here was $1.912 billion to $1.920 billion.
The Shareholder Letter
In the company’s letter to shareholders5, CEO Alex Karp was very bullish as usual. Here, he talked about how the company is just getting started. He also highlighted the firm’s US commercial segment, explaining that it is a “juggernaut.” His view is that this area of the business will become one of the most significant business stories of the century in American economic life.
Price Targets for PLTR Stock
While Wall Street analysts were impressed with Palantir’s Q3 performance, their views on the outlook for the stock are mixed. Some analysts believe the tech stock has gotten ahead of itself while others believe it can climb higher.
In the bearish camp lie brokers such as RBC and Jefferies. These firms have price targets6 of $50 and $70 respectively, meaning that they see the tech stock as overvalued currently. In the bullish camp lie firms such as Wedbush and BofA Securities. Their price targets are $230 and $255 respectively, meaning that they see further upside for PLTR in the medium term.
Footnotes:
1Yahoo Finance, Palantir Technologies Inc. (PLTR), as of November 5, 2025
2Palantir Investor Relations, Palantir Reports Q3 2025, as of September 30, 2025
3Yahoo Finance, Palantir stock falls nearly 8% on valuation fears after results top Wall Street estimates, as of November 4, 2025
4Palantir Investor Relations, Palantir Reports Q2 2025, as of June 30, 2025
5Palantir, Letter to Shareholders, as of November 3, 2025
6Investing.com, Palantir Technologies Inc (PLTR), as of November 5, 2025
