Palantir just answered the AI spending skeptics with a guidance raise, not a hedge, right after its stock had fallen 40% from its high.
Palantir Technologies reported second quarter 2026 revenue of $1.94 billion on August 3, up 93% from a year earlier and about $130 million ahead of the $1.80 billion Wall Street expected, according to CNBC and StreetInsider. Adjusted earnings came in at 41 cents a share, six cents above consensus. The company didn't just beat the quarter. It raised full year revenue guidance from a prior range of roughly $7.65 billion to a new range of $8.15 billion to $8.16 billion, according to Palantir's own release, well above the $7.69 billion analysts had penciled in.
That's the number that mattered walking into this print. Palantir shares had dropped about 40% from their November 2025 peak of $207.52, trading near $122 the day before earnings, according to TradingKey. The stock had beaten estimates for eight straight quarters and still fallen after each of the last four reports, a pattern that told you investors had stopped rewarding beats and started demanding proof the AI platform business could keep compounding. This time they got it. Shares jumped roughly 9% to 10% in after hours trading, pushing PLTR back above $140, according to FXStreet and FX Leaders.
The headline number was commercial. US commercial revenue hit $764 million in the quarter, up 149% year over year, according to Palantir's earnings release carried by Businesswire. That's not a rounding improvement. It's an acceleration from a business that was already growing faster than almost anything else in enterprise software. Palantir raised its full year US commercial growth guidance to at least 134%, up from a prior floor of 120%.
Government work held up too. US government revenue rose 90% year over year to $809 million. Palantir closed 220 deals worth at least $1 million in the quarter, 98 worth at least $5 million, and 73 worth at least $10 million, the company said. Remaining US commercial deal value, the contracted work still to be delivered, more than doubled from a year ago to $6.24 billion. That backlog is the real tell. It means the growth isn't just this quarter's number. It's already booked for the quarters ahead.
Palantir also lifted its adjusted free cash flow guidance to a range of $4.5 billion to $4.7 billion, up from $4.2 billion to $4.4 billion, and raised adjusted operating income guidance to between $4.889 billion and $4.897 billion.
The AI ROI question isn't settled, but Palantir just made its case #
Skepticism about AI spending has been building all summer. Investors have started asking a blunter version of a question that used to sound almost rude: what are companies actually getting back for the money they're pouring into AI infrastructure and software? Palantir's stock had been sliding on exactly that doubt. It was trading at roughly 40 times enterprise value to next year's revenue even after the drop - a multiple that leaves almost no room for a slowdown.
Frankly, a guidance raise across every major metric, revenue, commercial growth, free cash flow, and operating income, is about as direct an answer as a company can give. Palantir chief executive Alex Karp has spent the last two years arguing that the company's Artificial Intelligence Platform, AIP, converts pilot programs into paid, expanding contracts. It doesn't leave them stuck in proof of concept purgatory. The $6.24 billion in remaining US commercial deal value backs that argument with a number you can actually check, not a slide deck promise.
None of this settles the valuation debate. A stock trading at 40 times forward revenue still has to grow into that multiple, and one strong quarter doesn't erase four straight post earnings declines. But for a market nervously scanning every AI adjacent earnings call for cracks in enterprise demand, Palantir just handed it the opposite: an accelerating commercial book, a government business still growing 90% a year, and guidance that went up, not down.
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