Review|PLTR 4Q25: Another Accelerating Quarter, Alleviating Prior Concerns Around Competitive Pressure
The quarter played out very closely to what we outlined in our preview. Both Government and Commercial segments continued to accelerate in Q4, and the company demonstrated an ability to carry this momentum into FY26.
Financial Performance
FY25Q4 Overall Performance
In FY25Q4, revenue growth accelerated to 70% year over year, up meaningfully from 63% year over year in the prior quarter. Revenue exceeded the high end of guidance by 6% and consensus expectations by 6%.
FY25Q4 Government Segment
Government revenue grew 60% year over year in FY25Q4, accelerating from 55% in the prior quarter.
U.S. Government revenue grew 66% year over year, with quarterly revenue increasing by $97 million, broadly in line with our estimate of $100 million. This compares to 52% growth in the prior quarter and reflects continued acceleration.
Non-U.S. Government revenue grew 43% year over year, decelerating from 66% in the prior quarter.
FY25Q4 Commercial Segment
Commercial revenue grew 81% year over year in FY25Q4, up from 73% in the prior quarter.
U.S. Commercial revenue increased 137% year over year, accelerating from 121% in the prior quarter and continuing to demonstrate strong momentum.
Non-U.S. Commercial revenue grew 8% year over year, compared to 10% in the prior quarter, consistent with prior channel checks indicating stabilization rather than a full turnaround.
Rule of 40
The Rule of 40 reached 127% in FY25Q4, up from 114% in the prior quarter.
FY26Q1 Guidance
FY26Q1 revenue guidance implies up to 74% year-over-year growth at the high end, indicating further acceleration.
FY26 Full-Year Guidance
FY26 full-year revenue guidance implies up to 61% year-over-year growth at the high end, compared with 56% growth in FY25. This meaningfully exceeds market expectations of approximately 40%.
However, given FY25Q4 growth of 70% and FY26Q1 guidance implying 73% growth, the full-year outlook also suggests some degree of deceleration as FY26 progresses. Even so, considering Palantir’s historical pattern of beating the high end of guidance by more than six percentage points per quarter, actual growth may remain near current levels. Sustaining growth at an elevated rate supports digestion of the company’s current valuation.
