Palantir 2026Q2业绩直播
Key Takeaways (AI-Generated)
Financial Performance
- Q2 2026 revenue grew 93% year-over-year to $1.935 billion, highest ever reported growth rate
- US business revenue grew 115% year-over-year, comprising over 81% of total revenue
- US commercial revenue accelerated 149% year-over-year and 28% sequentially to $764 million
- Adjusted free cash flow reached $1.22 billion with 63% margin, 115% growth year-over-year
Business Highlights
- Closed $2.1 billion in US commercial TCV with 271% year-over-year growth rate
- Major customer wins including multinational technology company with nearly $370 million three-year deal
- Maven platform expanded with over 25,000 builders in government sector
- Partnership with NVIDIA for fine-tuning models that outperform Frontier models
Financial Guidance
- Raising full year 2026 revenue guidance to $8.15-8.158 billion (82% growth year-over-year)
- Raising US commercial revenue guidance to excess of $3.424 billion (at least 134% growth)
- Q3 2026 revenue expected between $2.16-2.164 billion
- Raising adjusted free cash flow guidance to between $4.5-4.7 billion
Opportunities
- Market expansion through AI sovereignty positioning as enterprises seek data and model control
- Product innovation with sovereign AI stack enabling customers to own weights and fine-tune models
- Strategic partnerships including NVIDIA collaboration for model optimization
- AIP platform converting tokens into real economic value faster than competitors
Full Transcript (AI-Generated)
Operator
Team and I'd like to welcome you to our second quarter 2026 earnings call. We'll be discussing the results announced in our press release issued after the market closed and posted on our Investor Relations website.
During the call, we will make statements regarding our business that may be considered forward-looking within applicable securities laws, including statements regarding our third quarter and fiscal 2026 results, management expectations for a future financial and operational performance and other statements regarding our plans, prospects and expectations.
These statements are not promises or guarantees and are subject to risks and uncertainties which would cause them to differ materially from actual results. Information concerning those risks is available in our earnings press release distributed after the market closed today and in our SEC filings.
We undertake no obligation to update forward-looking statements except as required by law. Further, during the course of today's call, we will refer to certain adjusted financial measures.
These non GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from GAAP measures. Additional information about these non GAAP measures including reconciliation of non GAAP to comparable GAAP measures is included in our press release and investor presentation provided today.
Our press release, investor presentation and other earnings materials are available on our Investor Relations website at investors.palantir.com. Over the course of the call, we will refer to various growth rates when discussing our business.
These rates reflect year over year comparisons unless otherwise stated. Joining me on today's call are Alex Karp, Chief Executive Officer, Shyam Sankar, Chief Technology Officer, Dave Glaser, Chief Financial Officer and Ryan Taylor, Chief Revenue Officer and Chief Legal Officer.
I'll now turn it over to Ryan to start the call.
Ryan Taylor
Our Q2 results are unprecedented but entirely unsurprising as the abrupt market shift in LLMS that we've been warning you about for years is now here. We delivered 93% year over year revenue growth, our highest ever.
The story of this quarter is once again our U.S. business. It now comprises over 81% of total revenue and grew 115% year over year and 23% sequentially.
Our US commercial revenue growth accelerated to 149% year over year and 28% sequentially. And our U.S. government revenue grew remarkable 90% year over year and 18% sequentially.
These top line results are accompanied by a rule of 40 score of 155 and $1.22 billion of adjusted free cash flow. We closed 220 deals worth $1 million or more, of which 98 deals were worth $5 million or more and 73 deals were worth $10 million or more, record highs across the board.
These results are a clear indication of the profound value we've unlocked both for and with our customers who dared to cross the chasm with us. In contrast, enterprises that are not using Palantir are seeing their token meter spinning endlessly just to get slop without any correlation to value.
This token model may be working for the labs, but it is not working for anyone else. It's breaking corporate budgets without results to justify the expense.
And worse, companies are paying to give away their most important secrets, the very basis for their competitive advantage, ultimately contributing to the commoditization of their own businesses as their secrets become the training data embedded in the foundations of all future models.
On our side of the chasm, what enterprises demand is AI sovereignty, owning the operational definition of the data, logic, actions and security of their enterprise. An organization's data is its treasure in its richness is the alpha.
We are fully aligned with our customers, building a stack that enables the compounding of their alpha. Our deep alignment allows our customers, ambitions and our own to become one.
As Kirkland and Ellis highlighted quote, through our work with Palantir, we have built a new operating model for legal services, one that centralizes and compounds the expertise of our most senior lawyers. What used to take days for a lawyer to analyze, discuss and draft that happens in minutes.
This would be impossible without the ontology. We do not see this as a vendor relationship or a one off endeavour. We think this is a revolutionary change in how our work gets done.
This is what we do with our customers across industries and the deals we are closing are a testament to the monumental shift in the AI market that's underway as we speak. In our US commercial business, we close $2.1 billion in TCV with a 271% year over year growth rate on a dollar weighted duration basis.
A multinational technology company began working with us in the fourth quarter of last year at 1 operating company and expanded on their success with our platform to deliver revolutionary impact across their full portfolio, converting to a three-year, nearly $370 million deal last quarter.
Customers are decisive and bold about taking the next step with Deer, a global asset management firm, started working with us in Q1, then converted last quarter to a three-year, $35 million TCV deal spanning asset management, automation and investment life cycle intelligence across 4 verticals.
After an agent camp in May, a global software and services company signed an initial $15 million five month deal last quarter and a leading nonprofit health system signed a pilot at the end of 2025 and then last quarter converted to a three-year partnership at $37 million TCV.
Our U.S. government business remains a source of extraordinary strength with momentum across both defense and civil. We continue to take great pride in our U.S. government work equipping our nation with the most advanced battle tested AI capabilities.
For Palantir, this is Our Calling. Our customers are making the decision to go deep with us with greater urgency and conviction that I've ever seen before, choosing AI sovereignty over dependency and compounding their alpha in a way that their competitors and adversaries will forever envy.
I'll now turn it over to Shyam.
Shyam Sankar
Thanks, Ryan. Ryan just talked about the incredible customer momentum behind Sovereign AI. I want to spend some time on the underlying product investments that positioned us for this moment.
AIP succeeded because it's the best, most ergonomic environment for AI in the enterprise. It integrates mixed mammal AI teams across heterogeneous interdependent workflows and delivers the fastest implementations that turn tokens into real economic value for our customers and complex high stakes environments.
What makes it work is exquisite and layered data integration and transformation, ontology and actions, security and audit workflows, agent SDKS, agent orchestration with telemetry and observability evals and customer specific benchmarks, AIP Evolve and our latest investments in post training, both supervised fine tuning and reinforcement learning.
Every layer builds on our foundational primitives and every layer flows together. This infrastructure captures the rich operational telemetry to feed the compounding loop, an automated model factory that runs inside the customer security boundary and accumulates intelligence and weights they control.
Last quarter I said tokens are the new coal and AIP is the train. Now our customers can build their own locomotives. AIP is where your sovereign AI is built, deployed, and compounded.
We're excited for a new era, not one of bench maxing, but a bench making the assumption that the Frontier is actually the best performing is just not borne out in practice. Within 24 hours of bringing Nemotron Ultra into our stacks, we found five production tasks where a standard Nemotron Ultra model without post training beat Frontier models.
This underscores that a handful of common benchmarks can be gained. That era bench maxing has ended. The new era is bench Making a customer specific benchmark is not just a scorecard, it's a hill to climb.
It's the normative orientation that directs your entire operational workflows and post training pipeline. It defines what better means on your terms for your business with your strategy, and then everything optimizes against it continuously.
And because the benchmark is yours, the trade-offs become yours too. AIP gives you the control plane to trade cost, performance and latency against each other and to decide where you run your weights versus theirs.
Workflow by workflow continuously. Now you can have a continuous improvement cycle that compounds your alpha into your weights. AIP was built for this.
We continue to see that our product is winning head to head. The others are focused on productivity. We are laser focused on turning tokens into real economic value for our customers.
The reality is that the market is created far more intelligence than it has converted into value. A more powerful model does not solve this problem. The limiting factor is the rate of AIP deployment.
A major Silicon Valley tech company recently ran a Bake Off a Frontier lab and its deployment team against AIP and our four deployed engineers. Remember, only Palantir has FDS, everyone else has sparkling sales engineers.
The lab picked a ticketing automation problem and failed to deliver anything of value against it. We built agent swarms for each of our customers. Customers proactively recommending marketing, packaging and pricing changes to drive revenue and utilization.
This work converted into a 10 million ACV contract. The lab was shown the door. Same customer, same timeline, same models.
The only difference was AIP and Palantir's unique FD tradecraft and it was determinative. It was an incredible quarter in U.S. government measured not just by 90% year over year revenue growth, but by mission impact.
Maven continues to deliver for the joint force from the factory floor to the foxhole. We had our first program in the Maven platform launched this past quarter where a government program of record chose Maven as the platform that they will operate their program in, taking advantage of our open data standards, ontology, developer tooling, peering, security and other platform primitives to go faster and deliver seamless experiences capabilities to the department's chosen command and control platform.
Maven has also continued to win as the developer and builder platform for the joint force with over 25,000 builders, uniformed service members, civilians, contractors and companies are developing agents and applications in and on the platform at the speed of war.
And for all that growth, our Department of War, trailing 12 month revenue is still less than 25 basis points of the Pentagon's budget. Finally, last week we held our first American Builder Summit in DC to celebrate the Americans who stepped forward to join the American Tech Fellowship and to let them make the case that AI is creating jobs and prosperity by sharing their stories and showing what they built.
We created ATF because the most transformative applications of AI that we saw were being driven by people without traditional tech backgrounds on literal front lines and factory floors. We now have over 1000 ATF grads.
One of our speakers, Jonah, who joined Tabot as a submarine parts manufacturer 13 years ago, straight onto the factory floor. He's a proud blue collar worker who still turns wrenches for a living.
And he built an AI application that took production planning from 30 to 40 days down to less than one. AI alone cannot do that. It takes AI in the hands of the American worker, the tribal knowledge earned through success and failure on the line, the insights only they have, the models are commodities, but the American workers not.
I'll turn it over to Dave to take us through the numbers.
Dave Glaser
Thanks, Sean. We had a phenomenal second quarter delivering our highest ever reported year over year revenue growth rate of 93% and our highest ever adjusted free cash flow of 1.22 billion, representing a 63% margin and 115% growth year over year.
We surpassed billion dollar milestones in GAAP net income, adjusted free cash flow and adjusted operating income. Revenue on our U.S. business grew 115% year over year and 23% sequentially in the second quarter.
Our US commercial business accelerated to 149% year over year and 28% sequentially and our U.S. government business grew 90% year over year and 18% sequentially.
We closed 2.132 billion of US commercial TCV bookings represent growth of 153% year over year and 81% sequentially, nearly 800 million above our prior highest US commercial bookings quarter.
We are seeing the immense demand of enterprises recognizing the need for sovereign AI to retain full control of their alpha. On the back of this exceptional continued strength in the US and accelerating demand for sovereign AI capabilities, we're raising our full year US commercial revenue guidance to an excess of 3.424 billion, representing a growth rate of at least 134%.
We're also raising our full year 2026 revenue guidance midpoint to 8.154 billion, representing 82% growth year over year and 11 point increase over our full year 2026 revenue guidance from last quarter and our largest ever full year revenue guidance raise.
Turning to our global top line results, second quarter revenue grew 93% year over year and 19% sequentially to 1.935 billion. Second quarter US revenue grew 115% year over year and 23% sequentially to 1.573 billion.
Revenue from our largest customers continues to expand. Second quarter trailing 12 month revenue from our top 20 customers increased 67% year over year to 124,000,000 per customer.
Now moving to our commercial segment. Second quarter commercial revenue grew 110% year over year and 22% sequentially to 945,000,000. We closed 2.337 billion in commercial TCV bookings in the second quarter, representing 118% growth year over year.
Our AI platform continues to dominate the US market as the only real choice for operationalizing LMS, particularly as more customers demand full ownership over the data, logic, actions and security of their enterprise.
Second quarter US commercial revenue grew 149% year over year and 28% sequentially. To 764,000,000, we closed a record setting 2.132 billion of US commercial TCV bookings, representing growth of 153% year over year.
Over the past 12 months, we closed 5.964 billion of US commercial TCV bookings, 117% increase from the prior 12 months, highlighting the accelerating demand for AI that creates real operational value.
Total mini deal value in our US commercial business grew 124% year over year and 27% sequentially. Our US commercial customer count grew to 653 customers, reflecting growth of 35% year over year and 6% sequentially.
Second quarter international commercial revenue grew 26% year over year and 2% sequentially to 182,000,000. Revenue from strategic commercial contracts was approximately $400,000 for the quarter, representing .02% of overall revenue.
We continue to expect revenue from these contracts to be less than $500,000 in each remaining quarter of this year. Shifting to our Government segment, second quarter government revenue grew 79% year over year and 15% sequentially to 990,000,000.
Second quarter U.S. government revenue grew 90% year over year and 18% sequentially to 809 million. This growth was driven by continued execution in existing programs and new awards reflecting growing demand for a platform in government.
Second quarter international government revenue grew 42% year over year and 5% sequentially to 181,000,000. We closed 3.4 billion of TCV bookings of 49% year over year.
On a dollar weighted duration basis, TCV bookings grew 129% year over year. Net dollar retention was 157%, an increase of 700 basis points from last quarter.
We ended the second quarter with 13.1 billion in total remaining deal value, an increase of 83% year over year and 11% sequentially and 4.9 billion in remaining performance obligations, an increase of 103% year over year and 10% sequentially.
As a reminder, RPO is primarily comprised of our commercial business as it does not take into account contracts with initial term of less than 12 months and contractual obligations that fall beyond termination for convenience clauses, both of which are common in most of our government business.
Turning to margin and expense, Adjusted gross margin which excludes stock based compensation expense was 86% for the quarter and reflects an increase in costs associated with taking on cloud hosting for one of our government customers.
While this change led to higher cost of revenue in Q2, going forward we believe it willpower faster time to value, drive greater efficiency, provide greater cost certainty to the customer and enable us to expand their future workflows.
Adjusted income from operations, which excludes stock based compensation expense and related employer payroll taxes was 1.194 billion in the second quarter, representing an adjusted operating margin of 62%.
Q2 adjusted expense was 741 million of 14% sequentially and 37% year over year, primarily driven by the continued investment in our AI platform and technical hiring.
As in prior years, we expect a significant ramp in expense in the third quarter due to the seasonality of new hire starts and other product and marketing initiatives. We remain committed to investing in the mostly technical talent as well as R&D for product pipeline and sovereign AI efforts, all delivering on our goals of sustained GAAP profitability.
Second quarter GAAP operating income was 912 million, representing a 47% margin. Second quarter Gap net income was 1.062 billion representing a 55% margin.
Second quarter stock based comp expense was 265,000,000 and equity related employer payroll tax expense was 17,000,000. Second quarter GAAP earnings per share was 41 cents.
Second quarter adjusted earnings per share was $0.41. Unrealized gains from our holdings in SpaceX resulted in a three cent tailwind to GAAP EPS and a 2 cent tailwind to adjusted EPS in the quarter.
Additionally, our combined revenue growth and adjusted operating margin accelerated to 155% in the second quarter, a 10 point increase to a rule of 40 score from the prior quarter and a 12th consecutive quarter of an expanding rule of 40 score.
Turning to our cash flow, in the second quarter we generated 1.216 billion in cash from operations and 1.22 billion in adjusted free cash flow, representing margins of 63%.
We ended the quarter with 9.2 billion in cash, cash equivalents and short term U.S. Treasury securities. Now turning to our outlook for Q32026, we expect revenue of between 2.16 and 2.164 billion and adjusted income from operations of between 1.292 and 1.296 billion.
For full year 2026, we are raising our revenue guidance to between 8.15 and 8.158 billion. We're raising our US commercial revenue guidance to an excess of 3.424 billion, representing a growth rate of at least 134%.
We raising our adjusted income from operations guidance to between 4.889 and 4.897 billion. We are raising our adjusted free cash flow guidance to between 4.5 and 4.7 billion and we continue to expect gap operating income and net income in each quarter of this year.
With that, I'll turn it over to Alex for a few remarks and then Honor will kick off the Q&A.
Alex Karp
Obviously we are loving these results and loving what they mean for our customers and and broadly speaking the West. So reflections on how we got to 93% aggregate growth, just under 150% growth in US commercial and an aggregate growth of 115% in America, which is astonishing, even surpassing the already anomalous results we've posted in the past and at a very significant scale.
And, and this the, the, the story really does begin at the beginning when we dedicated ourselves to our most important partners in the US government and we we built products to deliver value for them.
We delivered those value for those for them by looking at the world in its naked state. We did not have soft, we did not have AI available. We had to work with NLP.
So we had to develop forward to play engineer model to extend the technology and deliver value. The the nascent version of ontology was developed sham AKI others strapped Blackberries around their head and made the code work in sensitive environments.
And what we learned and what was built into this company is that there are there are things, values, structures that are more important than purely extracting value from a client.
And we rejected the the way in which we were being taught in Silicon Valley to build a software company at the time. Pound share of course is now both infrastructure software, FT ES orchestration and business know how.
It's a completely different hybrid. But at the time we were being told our job was to trick the clients into giving us money for something that made them attached to us, but really, really added no value.
So essentially A parasitic model. And in the rejection of that, we fully aligned with our partners. Now we to do that as we move through the years we built, we built PG Foundry, Gaia, Maven Ontology, AIP.
Now we're taking the IP stack and extending it for sovereign AI, which requires us to be able to orchestrate and fine tune models to provide a completely sovereign stack to our partners.
But what what is the philosophical importance of that? We are offering a present that that augers to a future that we want to live in. What is that future look like?
We have more rights in the PG frame. There's it's safer in the sovereign AI frame, which is arguably by far the most important because, you know, all these other things are downstream from GDP growth and GDP health.
And what if we transform America into the only democracy that actually grows where the where where production is more efficient and manufacturing actually happens? What is that frame?
That frame is not you are going to buy into a future where you have new job where adversaries win. And everybody who does win is a small, tiny group of people living in a tiny place that somehow believes because they eat vegetables and they don't support war fighters, that they deserve to have the total means of production of this country.
And the rest of us should just sit by back and absorb the cost of that revolution, which we're paying for. How are we paying for it in the in the enterprise context, people sign up for token self pleasurings and those that and that at a real cost.
Like other forms of self pleasuring where you are paying for the right for them to migrate your IP, your know how your expertise to their model so that they can build a competitive business that doesn't require your business, your people.
And why are they doing it? It's actually being done for what they believe are moral reasons. They are superior to you. They deserve to colonize your enterprise. You deserve to be colonized.
Then Palantir and a. It's interesting it doesn't work as well. Or as efficient purely on the alpha side as having an application layer, owning your compute witness.
We built a partnership with NVIDIA, we're expanding our application layer. We are going to enter the market and already entering it in the classified space as Sean alluded to of a fine tuning models.
So the models actually fine-tuned by us in our enterprise on the NVIDIA stack outperform Frontier models. And you own the weights, you own the alpha, you own everything.
Every single enterprise in this country, country is going to either look at doing this, find ways of doing it, or at least avoid the alternative of unprotected interaction with Frontier models.
This is very dangerous. You're worried about this in high school and now you're learning about it in your enterprise and a Palantir. We are at the front.
We are on the front of driving this revolution. I am driving the business to grow at a rate equal or above to what we have in US commercial for the next 18 months, which is a very high goal, but it is one we can actually get to because we are fully aligned with what's right and what's good and what actually works well in an enterprise.
And for the first time people believe us. And if you didn't believe us, you can believe 149% growth in the USA rule of of of of 40. That's one 5593% aggregate growth and 90% growth in US com with 60 to 63% of free cash flow margins.
People thought we wouldn't be profitable. So this is one of the more exciting times to be a Palantir. It's one of the more exciting times to participate in Palantir and for everyone on the sidelines, you got to get off the sidelines.
This is a revolution that will affect the sovereign revolution. Where you stand in it will affect your livelihood, the livelihood of the people you care and whether America in the West win.
We cannot regress to a thin philosophical model where only a small group of people who think very differently than most of us actually absorb all of the revenue and value in our business and transfer all the dangers to us.
And that's what this revolution is about. And it's extremely motivating for those of us at Palantir. Thank you.
Operator
Thanks, Alex. Our first question is from Dan with Yorkville Ives. Dan, please turn on your camera and then you'll receive a prompt to unmute your line.
Where's the prompt? Well, while we're waiting, you can be entertained. Maybe we can circle back to Dan.
Our next question is from Mariana with Bank of America. Mariana, please turn on your camera and then you'll receive a prompt to unmute your line.
Mariana
I think I'm good. Thank you. Can you walk through this at the the Sovereignty Boot Camp? What did you learn with talking to customers that maybe you weren't expecting?
I mean, obviously just an overwhelming sort of group of executives. Can you talk about that, Alex?
Alex Karp
Well, first of all, yeah, for those of you not in the know, we we, we did a sovereign boot camp after this kind of revolution exploded. And just to give the backdrop here, you know, two years ago we were said we, we spent four or five months, Sasha, who runs this organizing AIP con.
This was much more like, hey, let's invite our buddies over to lunch and then all of a sudden we start getting bombarded by people, People we invited, people we didn't invite all levels of the business.
So like when you're working in enterprise, it's really important that the operational people are interested. So it was like CEO's operational leads and there's a a huge educational component.
And Chomp talks about this a lot like we people understand that they need a way of controlling their alpha. They understand broadly the token maxing is at their own cost.
And they certainly understand the token maxing is leading to them transferring their data, their prompts, the way they run their business, their expertise to a third party. But they don't they, they need education on what they can do about that with us preferably, but also without us.
How do you do contracts? How do you how do you work with how do you work with open weight models? How do you work with close weight models?
How does this work in ontology? Is, is ontology the protective layer that they that they they've been told? Does it create value the way they, how would this look in their own business?
And how would they, would they, how would they work with the compute stack? And so there's just this massive demand. And we're in the business of educating people, both our customers and others.
But it was a super heterodox group of people, both in terms of the kind of people showed up, the demand for it, and also people we've not worked for.
By the way, you know, one of the reasons the NDR number is so strong it ridiculously strong. I mean, if people always write these things about customer adoption and maybe you know, but the NDR number is anonymously strong, that is also going to shift in a even as hard as it to believe become even more positive because some of our old.
Our partners we haven't really interacted with, they also showed up. They're like, OK, now we now we get why we would need you and not just Foundry, they're migrating across our stack.
So customers that are only using Foundry now on ontology now want to be part of the sovereign AI stack. I would say last not least you're asking the internal version, external version, internally recruiting, retention, excitement at Palantir.
It's it's, I mean, I'm very excited. I think the people around this table are very excited. The the legal department is excited.
This, I mean, that hasn't happened since like that doesn't happen. Like they're out like rock on. So it's just, it's more fun, you know.
So yeah, there's just it that that's the way this went down. And I think this is going to, this is the way beginning.
So you the way, the way at least we think about this internally is what portion of the market is available to people who want to create value, mean create value and keep it. That portion of the market has gone from a small portion of the market where we we were doing well to like a large, large part of the USGDP.
And that's why we need partners behind the scenes. Now we're trying to find partners now partners we need technically exceedingly competent partners.
Partners doesn't mean a vassal. We don't have to agree on every issue. We don't even have to agree on every client. They can occasionally compete against us.
We've seen this in the defence tech stuff stack and sham, you know, like the approach to defence tech where we partner with people. Partner doesn't mean we agree.
Sometimes we compete, but it means we're marching in a similar direction. Allows allows us to scale. So those things are going to be a very big important part of like essentially the guide.
Why am I pushing the company to to grow not to the just the end of the year, but next year? It's because that also forces us to to find ways to scale to meet the demand that's out there.
Operator
Thanks, Alex. Our next question is from Mariana with Bank of America. Mariana, please turn on your camera and then you'll receive a prompt to unmute your line.
Mariana
Good afternoon, everyone. Hello, good afternoon. So a follow up to to Dan's question, when all this AI revolution started, right, it was really cleared for enterprises that data and proprietary data and how you train your models was going to be the key.
But then we're like 3 years into that revolution and now everyone started to realize owning my data and wherever our link from my data is important. What happened there?
Why you think that you position yourself back then in a different approach to AI that enterprises weren't able to see and why these numbers that reflect that you're the winner of AI today? It wasn't that clear for any other software application back then.
Shyam Sankar
Well, you can kind of divide it up into two parts. There's the first part is efficacy, you know, and then the second part is efficiency. That's not the quite the right word, but it's like, how do you scale it in the zero to one phase?
It's much more important to focus on the application layer. Like, OK, this new thing has happened. How do we turn that into economic value?
And then as people started to experience the economic value and as time started happening, you started to see that some of the people who were partners out there, we're building things that were competitive to you.
And I think that took some time to kind of seep into the psyche and mindset of wait a second, this is maybe not, you know, now I know this thing is valuable in the right hands on the right platform.
But I also am going to need to control the weights that the alpha that is being generated isn't simply the data that's resident in my enterprise. It's also the metadata, the reasoning traces, the exhaust, the usage of this, which I don't yet have mechanisms to control.
And now I understand that's actually probably more valuable than just the data in my enterprise. And that's been a Clarion call I think for for the market over the last quarter, two quarters.
Alex Karp
There's the, there's also the question implicit in your question is, you know, why did we get this right? And you know, again, I think it's we are actually fully aligned with our partners.
Sometimes we make decisions like, you know, that are against our economic interests, like we're supporting lots of institutions in Europe. The growth sucks, I mean clandestine institutions, but without our products they would have rampant terrorism and their problems, their migration problems, and the results would be 10 times worse.
It's not actually in our economic interest anymore to do this, but we still do it. And it's because we actually are believers, for better or worse.
I would say also this is a company that from beginning, from inception has valued artistic insights. Meaning you can't model something purely on science. You have to have an aesthetic or artistic appreciation for it.
And we've made huge bets. Everyone at this, sitting at this table and many, many hundreds of people at Palantir have essentially artistic insights.
We've always viewed ourselves. We've always said we're a colony of artists and people assume that means we're just difficult. And that's also true.
But you know, it's, it's also we value insights that are way before anyone else would see them. And we build major parts of our business. That's very hard for normal business to do.
Because I mean, one of the jokes running around Palantir is we can, we can definitely meet our guide next year if we get paid for all the people copying us, you know, so we've got a small portion of people copy, you know, of the, of the, of the, of the funds for the copiers.
We do very well. Normal businesses, again, no critique here are built around there was a playbook. We execute on that playbook and we're in a non playbook world.
So executing on a playbook that worked 510 years ago, essentially build parasitic software and monetize it, that doesn't work now. And there's hundreds of variants of that.
But that is a central advantage we have. We are a colony of believers and artists that are very motivated to try value. And that sets us aside much more than I would have imagined 10 years ago if you'd asked the same question.
And it and then luckily for us, this is capitalism. I mean, DSA wants to get rid of it, but until they do, you got to look at the results because if our results and, and the other thing I'll tell you that's very special for us.
We are outsiders, outsiders. Like you're an outsider, you come to this country, you better have really good results, you know, and like the same thing for a pound here.
We know we need the best results because people aren't buying our product because we're swinging the Golf Club correctly or paying for the steak dinner. They don't even invite us to steak dinners.
So that's, and that outsider status has causes huge problems, but in the 1st 18 years, but a lot of benefits in the next 18 years. And other people don't like being outsiders.
I'm, I'm, you know, in fact, I'm struggling with our current popularity. Thank you.
Operator
Our next question is from Gil with DA Davidson. Gil, please turn on your camera and then you'll receive a prompt on your line.
Gil
Thank you. The topic of sovereignty, you focused a lot on how dangerous it is to give the keys to the labs because they could chose to compete with you.
Is there another aspect of this as well, though, That if you choose a lab and you buy the orchestration and the consulting and the harnesses from them, you're beholden to their models.
And if something happens, if it's not the best model anymore, if the model gets pulled, then you as a customer are stuck and you may have a mission critical system fail.
And this isn't hypothetical. This happened a couple of times this year or one of the frontier models got pulled by either the government or the company.
Well, if you work with Palantir, I would assume that when that happens, you can go to your customer and say, hey, if that model doesn't work, I can plug in another model for you.
Alex Karp
No, I mean, I'll let Ryan and Chom comment here, but we're already doing that across the USGUS government. We have a product that allows you to switch out models.
Look, at the end of the day, if, if you are locked into a product, you're going to, I mean, that's the nature of monopoly capitalism that that's why people want the lock in because then they can raise the prices and reduce the quality.
We're against that because we're on the side of the American work of the American people. And it's great institutions and other institutions across the West.
But yes, they're, you know, and people are running big enterprises in this country are very sophisticated. They're aware of these risks and they don't like people who are kind of flaunting, like setting this up so that they feel they're being made fun of or they're being their sucker, basically.
So there's a lot, honestly, there's a lot of anger here. I spent, interestingly, a fair bit of my time trying to explain to people that, you know, some of the people involved in these things are not the caricatures they think they are, But because the business setup looks like heads I win, tails I win and American business people don't like that.
But then I don't know, there's a lot of things on the contractual front that would that would support that.
Ryan Taylor
Yeah, I would say like that's, you know, our whole focus is converting tokens to value. The example Sham gave that's happening across the board in the conversations with customers.
That's why they're looking to expand, to convert how they position themselves in the industry with us in their industry. And so we're seeing like extreme alignment.
It's not about being beholden to 1 model, it's about being bringing the right models to bear for the right purposes. And our contracts, our structures are set up to do that to support and compound their alpha in the organization.
Shyam Sankar
I think, you know, I mentioned earlier, but you're going to see this like we've been beholden to a small number of benchmarks that people have been designing models to and then releasing models saying, I look how well it does on this benchmark, but the benchmark has actually almost nothing to do with your business.
What? So how do you figure out how to make the benchmark that represents your reality, what you're trying to succeed at? What are you trying to get better at?
And then see what model makes sense and the natural consequence of doing that, even leaving aside all of your other arguments for sovereignty, it's like, oh, how do I, how do I climb that? At that hill, how do I figure out what it is that I do as a business that I feedback into weights that I can control, which presupposes an open model and sovereignty and then you're not just going to do that where you're waiting hey, maybe I'll switch it out when this model gets pulled in the rug gets pulled out from underneath me.
You're actually going to be leveraging the automation to do that constantly to figure out when you have a next checkpoint that you can afford. Maybe there's a new model.
I mentioned the example. I literally almost felt gas lit when within 24 hours of getting Nemotron up with no post training. This is vanilla Nemotron Ultra.
It did better than Frontier. You know, if you just looked at the numbers, you would say, well, it's nowhere near the Frontier. That shouldn't even be possible.
But of course the benchmarks are wrong. I mean, the benchmarks are right for what the benchmarks measuring, but that's not my business. Those are not the task my customers had that they were trying to solve.
And so then moving this to an empirical basis is, I think is, is how we're going to accelerate the realization of tokens to real economic value. Thank you, Alex, as always.
Operator
We have a lot of individual investors on the line. Is there anything you'd like to say before we end the call?
Alex Karp
Well, you know, your support has was crucial to getting us as far and, you know, crucial to getting us to where we're going to go, which is a much, much, much, much larger company.
This is one of the most exciting times to be involved in the Palantir mission. We are going to help transform especially this country, but allied countries both in commercial and government.
And this sovereign frame that is we're using as our organizational principle is one that is inclusive of everybody who wants to have a better world today and tomorrow. And we invite everyone to engage with it in some form.
And thank you.
Operator
Thank you. That concludes Q&A for today's call.
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