Palantir Technologies Inc. (PLTR) Government Revenue Declines Sequentially, Citi Reiterates Sell

Citi analyst Tyler Radke reiterated a Sell rating and $18.00 price target on Palantir Technologies Inc. (NYSE: PLTR) after the company reported a steep revenue deceleration in both Commercial (ex-SPACs) and Government sectors. Total revenue beat Street consensus by ~2% but decelerated 13pts. The biggest surprise was in Government where revenue declined sequentially, and y/y decelerated by over 30pts (34% y/y vs. 2Q
66%).

The analyst stated "Palantir’s decelerating growth came into center view in Q3 with weakness in both Commercial and Government. Government revenue declined Q/Q and decelerated by 32 pts, meaningfully missing expectations. Reported Commercial revenue growth reaccelerated (+37% vs. 28% last Q) and beat street (13%), but this was solely driven by the questionable “Strategic Investments” strategy, which contributed a significant 15 pts of growth. While guidance for Q4 was issued slightly ahead of the street, it still implies slower growth, even on an easier compare and with significant tailwinds from SPAC related customer contracting. We reiterate our Sell rating, as we expect the stock to be under pressure given the disappointing results both in Government and “ex-SPAC” Commercial, which are showing rapidly decelerating growth as they lap Qs that benefited from COVID-related contracts."

For an analyst ratings summary and ratings history on Palantir Technologies Inc. click here. For more ratings news on Palantir Technologies Inc. click here.

Shares of Palantir Technologies Inc. closed at $24.25 yesterday.

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