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- Palantir surged 16% on Tuesday after it reported its first profitable quarter on record.
- The company reported earnings results that topped analyst estimates and talked up its potential in artificial intelligence.
- "With this result, Palantir is profitable. This is a significant moment for us," CEO Alex Karp said.
Palantir stock soared as much as 16% on Tuesday after the company reported its first profitable quarter on record.
The company generated GAAP income of $31 million in its fourth-quarter, and it topped analyst estimates for both revenue and profit.
Here were the key numbers:
Revenue: $508.6 million, versus analyst estimates of $505.0 million
Adjusted earnings per share: $0.04, versus analyst estimates of $0.03.
"With this result, Palantir is profitable. This is a significant moment for us and our supporters," CEO Alex Karp said.
The company said its US customer count surged 79% year-over-year to 143 customers at the end of its fourth-quarter. Palantir generated adjusted free cash flow of $76 million.
Palantir offered guidance that was below analyst estimates for its first-quarter and 2023 as a whole. The company expects revenue of as much as $507 million in its first-quarter, about $13 million shy of analyst expectations. Revenue for the full year is expected to be as much as $2.23 billion, which is about in-line with analyst expectations.
Investors could also be bidding shares of Palantir higher because Karp talked up the potential of its artificial intelligence capabilities on the company's earnings conference call, following a trend of companies seeing their stock price pop on even the smallest mention of the nascent space.
"I think the biggest event in digitalization AI is actually on the battlefield... and so we had a lot of thought going into this and spent the last five years building the core infrastructure that you would need to power and train AI algorithms," Karp said.
In the company's quarterly investor letter, Karp said he expects Palantir's AI offerings will help grow its business going forward, and that the demand he is expecting from AI going forward has already surpassed his expectations from just a few months ago.
"The widespread adoption of artificial intelligence in civilian applications will come soon. In the military context, it has already arrived," Karp wrote.