What Happened?
Shares of data-mining and analytics company Palantir (NYSE:PLTR) fell 13.3% in the afternoon session after the company reported first quarter 2025 results, which had high expectations heading into the prints, making it hard for the stock to impress Wall Street. The quarter itself was fine. Palantir beat analysts' revenue and adjusted operating income expectations and raised full-year guidance on both metrics. Zooming out, we think this was a decent quarter, but markets were expecting more given its lofty valuation.
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What The Market Is Telling Us
Palantir’s shares are extremely volatile and have had 44 moves greater than 5% over the last year. But moves this big are rare even for Palantir and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 12 days ago when the stock gained 6.6% as stocks extended their rebound, led by strong gains in the technology sector, as renewed optimism surrounding U.S.–China trade negotiations lifted investor sentiment.
Contributing to the bullish tone was a standout earnings report from enterprise software leader ServiceNow, which topped Wall Street's expectations on both revenue and earnings. More importantly, the company's remaining performance obligations (RPO), a key forward-looking metric for future revenue, also exceeded forecasts, giving investors confidence that enterprise customers are not pulling back spending amidst uncertain macro.
The optimism was further reinforced by solid results from Texas Instruments and Lam Research. Their performance was especially encouraging for semiconductor stocks, which have been under pressure due to their exposure to global trade tensions. These results suggested that, despite macroeconomic uncertainties, demand in key tech verticals remained resilient.
Palantir is up 45% since the beginning of the year, but at $109.06 per share, it is still trading 12.5% below its 52-week high of $124.62 from February 2025. Investors who bought $1,000 worth of Palantir’s shares at the IPO in September 2020 would now be looking at an investment worth $11,479.
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