01—Abstract
Summary
Summary of the 10-Q filed May 12, 2021. Cited figures are marked; the original filing is the authoritative source.
Palantir Technologies Inc. reported its first quarterly results as a public company on May 11, 2021, for the period ending March 31, 2021.
The company demonstrated strong revenue growth, with total revenue increasing by 49% year-over-year to $341.2 milliona. This growth was primarily driven by a significant increase in government revenue (up 76%), alongside a more modest increase in commercial revenue (up 19%). Despite the top-line growth, Palantir continued to operate at a net loss, reporting a net loss of $123.5 million for the quarter.
This loss was influenced by substantial increases in operating expenses, particularly in sales and marketing, research and development, and general and administrative costs, all of which saw significant year-over-year increases, largely driven by stock-based compensation expenses. The company ended the quarter with a solid cash position of $2.3 billionb, indicating sufficient liquidity for its operations. From an operational efficiency perspective, Palantir's gross margin improved to 78% from 72% in the prior year period, or 83% when excluding stock-based compensation.
The company's 'contribution margin,' a non-GAAP metric excluding stock-based compensation, also showed improvement, reaching 60%c compared to 41% in the prior year. This suggests improving operational leverage, particularly in the government segment.
The growth in customer numbers to 149 from 131 in the prior year, coupled with a 29%d increase in average revenue per customer, signals positive customer traction and expansion within existing accounts. Investors should monitor the company's ability to translate this growth into profitability while managing its significant operating expenses.
02—Key points
Key Highlights
- Revenue grew 49% year-over-year to $341.2 million, driven by strong performance in the government sector.
- Government segment revenue increased by 76% year-over-year, while commercial segment revenue grew by 19%.
- The company reported a net loss of $123.5 million for the quarter, an increase from $54.3 million in the prior year, reflecting increased operating expenses.
- Operating expenses (Sales & Marketing, R&D, G&A) increased significantly year-over-year, largely due to higher stock-based compensation.
- Gross margin improved to 78% (or 83% excluding stock-based compensation), indicating better operational efficiency.
- Customer count grew to 149 from 131 in the prior year, with average revenue per customer increasing by 29%.
- Palantir ended the quarter with $2.3 billion in cash and cash equivalents, providing ample liquidity.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q1 FY2021, Palantir Technologies Inc. lost $0.36.
- Revenue$341.2M100.0%
- Cost of revenue−$74.1M21.7%
- Gross profit$267.1M78.3%
- Operating costs−$381.1M111.7%
- Operating income−$114.0M33.4%
- Interest, other & tax−$9.5M2.8%
- Net income−$123.5M36.2%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2021filed May 12, 2021Financial Statements
Q1 FY2021 against Q1 FY2020
| Line item | Q1 FY2021Q1 FY2020 | Change |
|---|---|---|
| Revenue | $341.23M$229.33M | +48.8% |
| Cost of Revenue | $74.11M$64.29M | +15.3% |
| Gross Profit | $267.12M$165.03M | +61.9% |
| R&D Expenses | $98.47M$65.80M | +49.7% |
| Operating Expenses | $381.14M$235.22M | +62.0% |
| Operating Income | -$114.01M-$70.19M | −62.4% |
| Interest Expense | $1.84M$4.59M | −59.9% |
| Net Income | -$123.47M-$54.27M | −127.5% |
| EPS (Basic) | $-0.07$-0.09 | +22.2% |
| EPS (Diluted) | $-0.07$-0.10 | +30.0% |
| Shares Outstanding (Basic) | 1.82B591.85M | +207.7% |
| Shares Outstanding (Diluted) | 1.82B594.36M | +206.4% |
05—Questions
Frequently Asked Questions
What was Palantir's revenue growth in Q1 2021?
Palantir's total revenue increased by 49% year-over-year to $341.2 million in the first quarter of 2021.
What was Palantir's net loss in Q1 2021?
Palantir reported a net loss of $123.5 million for the first quarter of 2021, an increase from $54.3 million in the same period last year.
How did the government and commercial segments perform?
The government segment revenue grew significantly by 76% year-over-year, while the commercial segment revenue saw a more modest increase of 19% year-over-year.
What is Palantir's current cash position?
As of March 31, 2021, Palantir had $2.3 billion in cash and cash equivalents, indicating strong liquidity.
What is the company's outlook on profitability?
Despite strong revenue growth, the company continues to incur net losses, driven by significant investments in operating expenses, particularly stock-based compensation. Profitability remains a key area for investors to monitor.
06—Continue