Palantir Technologies has updated its revenue forecast for 2025, a move that has resulted in an 8% drop in the company’s shares during after-hours trading. The announcement comes as the AI-focused data analytics firm reported only modestly surpassing revenue expectations, which did not fully meet investor hopes.
For the second quarter of 2025, Palantir projects revenue between $934m and $938m, with adjusted operating income expected to range from $401m to $405m. For the full year of 2025, the company has increased its revenue forecast to between $3.89bn and $3.9bn. In addition, Palantir has raised its guidance for US commercial revenue to exceed $1.18bn, equating to an anticipated growth rate of at least 68%.
Adjusted operating income is now projected to fall between $1.71bn and $1.72bn, while adjusted free cash flow is estimated to be between $1.6bn and $1.8bn.
Earlier this year, Palantir’s stock saw substantial gains, rising over 60%, driven by investor confidence in the firm’s potential to benefit from widespread AI deployment and increased government spending on defence-related technology.
Palantir’s Q1 2025 financial results
Palantir, which announced its financial results for the first quarter ending 31 March 2025, reported a 39% increase in total revenue compared to the previous year, reaching $884m. The company saw significant growth in the US market, where revenue rose by 55% year-over-year to $628m. This growth was primarily driven by a 71% increase in US commercial revenue to $255m and a 45% rise in US government revenue to $373m.
“We are in the middle of a tectonic shift in the adoption of our software, particularly in the US where our revenue soared 55% year-over-year, while our US commercial revenue expanded 71% year-over-year in the first quarter to surpass a one-billion-dollar annual run rate,” said Palantir co-founder and CEO Alexander Karp.
Palantir’s GAAP net income stood at $214m or $0.08 per share, compared to $105.5m in the same quarter last year, with adjusted earnings per share recorded at $0.13.
Total US revenue experienced a 55% year-over-year increase, while US commercial revenue grew by 71%, totalling $255m, and US government revenue rose by 45%, reaching a total of $373m. The company closed 139 deals valued at over $1m each, including 51 deals worth at least $5m and 31 deals at or above $10m. They achieved a record high quarterly US commercial total contract value (TCV) of $810m, marking a 183% increase year-over-year.
In the UK, Palantir is involved in the NHS Federated Data Platform (FDP), which aims to consolidate data from NHS hospital trusts into a single system. As of 8 April 2025, 45 NHS hospital trusts are using the FDP, with a total of 108 signed up. The £330m contract, awarded to Palantir in November 2023 for seven years, seeks to centralise data across 42 care regions. However, by November 2024, the NHS reported slower than expected progress in implementing the FDP, with only 28 out of 42 integrated care boards adopting the platform, as noted by NHS England via the Financial Times.
Read more: NHS struggling to meet targets for Palantir platform adoption
