Executives at Palantir Technologies Inc. see the software company as strongly positioned for the current uncertain environment, but shares were tanking on Monday after the company delivered a mixed earnings report and downbeat forecast.
slightly exceeded revenue expectations for its first quarter, it fell short on the bottom line. The company posted adjusted earnings per share of 2 cents on revenue of $446.4 million, whereas analysts tracked by FactSet had been projecting 4 cents in adjusted EPS and $443.4 million in revenue.
Palantir remained unprofitable on a GAAP basis in the latest quarter, though losses shrank. The company reported a GAAP net loss of $101.4 million, or 5 cents a share, down from $123.5 million, or 7 cents a share, in the year-earlier period.
For the current quarter, Palantir expects revenue of $470 million in its “base case,” which came in below the FactSet consensus of $484 million.
“There is a wide range of potential upside to our guidance, including those driven by our role in responding to developing geopolitical events,” Palantir shared in its release.
Shares were off more than 20% in Monday morning trading, reaching an all-time intraday low of $7.32; shares had never previously moved lower than $8.90, and have never closed lower than $9.03 since they were listed in September 2020, according to FactSet. The stock was also on track for its steepest single-day percentage decline on record, topping a 15.8% drop on Feb. 17.
“In this macro environment, we feel very well-positioned for the full year and beyond,” Kevin Kawasaki, the company’s head of business development, shared on Palantir’s earnings call. He noted that the company has “already seen some reacceleration” in its U.S. government business thus far in the second quarter, something he pegs as “a long-term trend.”
Analysts used the call as an opportunity to drill further into Palantir’s outlook, including the company’s classification of its revenue forecast as a “base case” amid the range of potential outcomes.
“The base case is really establishing how we’re thinking about the visibility that we have,” Chief Operating Officer Shyam Sankar said. “The upside is quite large.”
He further noted that “a lot of this comes down to contract timing and the acceleration of events. Palantir is “not going to deprive you of help in your moments of greatest need when you’re at war because paperwork isn’t in yet,” he continued.
Executives also elaborated on Palantir’s positioning during the call, including in response to a question about whether “bad times are good” for the company.
“As our customers confront rapidly escalating conflict in Eastern Europe, runaway inflation, disrupted supply chains and a new wave of refugees, our products have become more essential than ever,” Sankar said.
In Palantir executives’ view, the company’s Foundry platform offers more dynamic software than legacy providers and can help customers better adjust to evolving circumstances.