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Palantir’s 2025 Rally Runs Into a Valuation Reality Check

A rich price tag now tests how durable Palantir’s AI-driven momentum really is.

Overview

  • Shares jumped more than 120%–130% in 2025 and roughly 990% over two years, far ahead of the broader market.
  • Palantir now trades around 166 times forward earnings and at over 100 times sales, prompting sharper downside concerns.
  • Q3 revenue grew about 63% year over year, while commercial revenue rose 73% to $548 million and topped U.S. government sales for a fourth straight quarter.
  • Demand for the company’s AI Platform helped expand its adjusted operating margin, signaling increasing operating leverage.
  • Skeptics point to extreme multiples, uncertain AI spending and potential regulation, with Michael Burry characterizing the stock as an obvious short.