Palantir forecasts greater demand from US groups for its AI software

Palantir raised its revenue forecast for the year on Monday, saying demand from US companies for its American-made AI software was helping lift sales.

The Florida-based tech company said it expected full-year revenue of at least $8.15bn with US commercial revenues of $3.4bn. Both figures exceeded analysts’ expectations.

Chief executive Alex Karp told investors Palantir was benefiting significantly from a push towards AI sovereignty — an effort by nation states and companies to contain data within their own borders to avoid interference from other actors, including foreign governments.

“The revolution for independence and AI sovereignty is now well under way,” Karp said in a letter to shareholders. “The demand from our partners is clear . . . It is for control over data.”

Monday’s increased outlook helped lift Palantir’s shares more than 12 per cent in after-hours trading. Investors had been pulling back from the group amid fears of AI-induced disruption. Its shares had fallen 25 per cent in the year to date ahead of the earnings.

Palantir also posted better than expected earnings for the second quarter, with US sales climbing 23 per cent to $1.57bn. Net income for the period came in at about $1.06bn.

Karp said Palantir users had “declined to become vassal states of the language labs” such as Anthropic and OpenAI. He said that companies were turned off by the “token industrial complex” that billed customers for usage rather than productive outcomes.

“We do not get paid for clicks or tokens or chats,” he said. “The gamification of the most significant development in modern economic history seems to us misplaced.”

Palantir, which was founded in the years following the September 11 terror attacks, has positioned itself as a bastion of the west capable of defending the US and its allies from similar threats.

Yet the business has experienced pushback in international markets as Karp increasingly intertwines Palantir with the Trump administration and its policies, including a crackdown on illegal immigration. Karp has commented on the business being “anti-woke” and its tools being used to kill US enemies.

The company’s Maven tool has been deployed by the US military in strikes against Iran, with the Pentagon using the system to comb through data and identify targets.

Foreign governments are increasingly seeking to disentangle themselves from Palantir and other US tech groups in an effort to move their systems outside the sphere of Washington’s influence.

France’s domestic intelligence agency signed a deal with ChapsVision in June alongside plans to give government workers access to an AI assistant powered by France’s Mistral. Palantir’s UK contracts have been subject to significant scrutiny, while Germany’s armed forces have excluded the group from contracts.

Officials in Denmark and the Netherlands have similarly expressed a desire to uncouple from the US-based software group.

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Palantir’s business has grown more concentrated in the US, with it ever more reliant on deals in its home market. Roughly 19 per cent of its total revenue in the quarter came from international customers, down from 26 per cent in 2025.

The company has signed a number of commercial deals, including reaching an agreement with law firm Kirkland & Ellis in June to deliver an AI system that can draft letters, track agreements and monitor compliance.

But these deals are dwarfed by its $10bn agreement with the Pentagon last year to provide tools for the army over the coming decade.