Alongside their Q4 earnings, Palantir Technologies Inc. (NYSE: PLTR) revealed a multi-million dollar expansion of its collaboration with no other than the conglomerate 3M (NYSE: MMM). 3M will be expanding its use of Palantir’s Foundry platform during its undergoing digital transformation to build a dynamic supply chain and be able to respond nimbly to changes in demand across tens of thousands of products. Palantir’s stock has been under pressure lately as insiders have sold shares as soon as the lockup provision expired. The stock sales likely do not indicate Palantir’s prospects are worsening because insider sales are common, especially among executives who count company stock as a large piece of their net worth.
Since Palantir went public in late September via a direct listing, its stock has skyrocketed more than 175%. Its most recent fourth quarter earnings saw revenue beating expectations although the company delivered a loss.
Q4
Revenue of $322 million topped $300.7 million expected, according to a Refinitiv survey of analysts but brought a bottom line loss per share of 8 cents. Average revenue per customer for 2020 came to $7.9 million, which is up 41% from 2019. Its top 20 customers generated $33.2 million each on average last year, which is a YoY increase of 34%. In the fourth quarter, Palantir sealed 21 deals worth at least $5 million in total contract value, including 12 worth at least $10 million. New contracts include those with the U.S. Army, U.S. Food and Drug Administration, PG&E and British Petroleum (NYSE: BP), along with an important distribution deal with IBM (NYSE: IBM).
Outlook
Palantir expects to earn $4 billion in revenue by 2025 and it expects revenue to grow more than 30% in 2021. The first quarter should see revenue growing 45% which is higher Refinitiv analyst estimates of about $309 million.
Customers
The company did not provide an updated customer count just like in November. When it disclosed its prospectus, it had125 customers in the first half of 2020. Unlike other California-based tech companies, Palantir has been more willing to work with government agencies during Donald Trump’s presidency. Employees at Amazon (NASDAQ: AMZN), Alphabet, Inc. (NASDAQ: GOOG) and Microsoft (NASDAQ: MSFT) have urged the company to step away from such deals.
But Palantir has built its business largely on lucrative government deals for its data analytics software, including a collaboration with ICE. But it did state it will not work with customers whose positions or actions the company considers inconsistent with its mission to support Western liberal democracy. Although it also serves commercial customers, they make up less than half of the business and the segment isn’t growing as fast as the government segment. In its first earnings release after its IPO, 56% of its third quarter’s revenue came from its government segment. In the fourth quarter, the government segment was up 85% YoY as it generated $190 million in revenue, whereas its commercial segment went up only 4% YoY as revenue amounted to $132 million.
In an increasingly complex world, the success of any business depends on its ability to respond quickly to changing facts on the ground. Palantir has that part covered but it has also set itself apart from other Silicon Valley companies and customers look at both the offering and the brand when choosing who to buy from.
This article is not a press release and is contributed by IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: [email protected] Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: [email protected]
The post Palantir Joins Forces With 3M appeared first on IAM Newswire.
See more from Benzinga
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
