Palantir Technologies Inc. · Q2 2026 call

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.

enterprises that are not using Palantir are seeing their token meters 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.

In our U.S. commercial business, we closed $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 one operating company and expanded on their success with our platform to deliver revolutionary impact across their full portfolio, converting to a 3-year nearly $370 million deal last quarter.

Within 24 hours of bringing Nemotron Ultra into our stacks, we found 5 production tasks where a standard Nemotron Ultra model without post-training beat frontier models. This underscores that a handful of common benchmarks can be gamed. That era, benchmaxing has ended. The new era is benchmaking.

The reality is that the market has 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 forward deployed engineers. […] The lab picked a ticketing automation problem and failed to deliver anything of value against it. […] This work converted into a $10 million ACV contract. The lab was shown the door. Same customer, same time line, same models.

for all that growth, our Department of War trailing 12-month revenue is still less than 25 basis points of the Pentagon's budget.

We're also raising our full year 2026 revenue guidance midpoint to $8.154 billion, representing 82% growth year-over-year and an 11-point increase over our full year 2026 revenue guidance from last quarter and our largest ever full year revenue guidance raise.

Net dollar retention was 157%, an increase of 700 basis points from last quarter. […] Second quarter trailing 12-month revenue from our top 20 customers increased 67% year-over-year to $124 million per customer.

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.

Q2 adjusted expense was $741 million, up 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.

Unrealized gains from our holdings in SpaceX resulted in a $0.03 tailwind to GAAP EPS and a $0.02 tailwind to adjusted EPS in the quarter.

In the enterprise context, people sign up for token self-pleasuring 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.

I am driving the business to grow at a rate equal or above to what we have in U.S. 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 if you didn't believe us, you can believe 149% growth in the U.S., a Rule of 40 that's 155%, 93% aggregate growth and 90% growth in U.S. gov with 62%, 63% free cash flow margins. People thought we wouldn't be profitable.

the NDR number is anomalously strong that is also going to shift as hard as to believe, become even more positive because some of our older partners we haven't really interacted with, they also showed up. […] So customers that were only using Foundry, now want Ontology, now want to be part of the sovereign AI stack.

what portion of the market is available to people who want to create value, I mean create value and keep it. That portion of the market has gone from a small portion of the market where we were doing well to like a large part of the U.S. GDP.

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 are a colony of believers and artists that are very motivated to drive value. And that sets us aside much more than I would have imagined 10 years ago if you'd asked the same question.

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 like, look how well it does on this benchmark. But the benchmark has actually almost nothing to do with your business.