Palantir stock closes up 23% to record upbeat guidance

Palantir shares closed up 23% on Tuesday for a record close after the data analytics software maker reported robust third-quarter results and issued upbeat revenue guidance.

The stock hit a closing high of $51.13, above the previous high of $44.97 reached last week. The gain marks the stock’s biggest jump since February 6, when shares rose 30%.

Revenue rose 30% to $726 million from a year earlier, topping the average analyst estimate of $701 million, according to LSEG. The adjusted earnings per stock at 10 cents beat the average estimate of 9 cents.

Analysts at Deutsche Bank said in a report that “the beat was driven by better-than-expected performance from the US government,” boosted by demand for artificial intelligence tools.

“Palantir is among a handful of infrastructure software companies that have started to monetize generative AI, with its competitive positioning benefiting from long-term investment and deep expertise in complex data integration, and especially its reputation for data security built into its ontology,” the analysts wrote.

Net income of $143.5 million, or 6 cents per share, was up from $71.5 million, or 3 cents per share, in the same quarter a year ago. The company called for fourth-quarter revenue of $767 million to $771 million. Analysts surveyed by LSEG had been looking for $741.4 million.

Palantir is targeting more than $687 million in US commercial revenue for the year, which represents about 24% of the total.

Bank of America raised its price target from $50 to $55 and maintained its buy rating.

“We continue to see the adoption of PLTR’s AI-enabled products and reach in its early days as more companies realize the potential time, resource and cost savings,” Bank of America analysts wrote in a note to investors. “In our view, Palantir’s moat as the differentiated agnostic AI enabler only grows with each new use case that carries composition unit economics.”

— CNBC’s Jordan Novet and Michael Bloom contributed to this report.