01—Abstract
Summary
Summary of the 10-Q filed August 12, 2021. Cited figures are marked; the original filing is the authoritative source.
Palantir Technologies Inc. (PLTR) reported its financial results for the quarter and six months ended June 30, 2021.
The company demonstrated strong revenue growth, with total revenue increasing by 49%a year-over-year for both the three-month and six-month periods. This growth was primarily driven by a substantial increase in revenue from government customers, alongside solid growth in the commercial sector. Despite the revenue expansion, Palantir continued to incur operating losses, although adjusted income from operations (excluding stock-based compensation and related payroll taxes) showed significant year-over-year improvement.
The company's gross margin also saw an improvement, both on a reported basis and when excluding stock-based compensation. Operating expenses, particularly in sales and marketing, R&D, and general and administrative categories, increased significantly, largely due to higher stock-based compensation expenses, which are a notable cost for the company.
Palantir's liquidity position remained strong, with a substantial amount of cash and cash equivalents and an undrawn revolving credit facility. The company also highlighted its commitment to expanding its customer base and platform adoption across both government and commercial sectors.
02—Key points
Key Highlights
- Strong Revenue Growth: Total revenue increased by 49% year-over-year for both the three and six months ended June 30, 2021, reaching $375.6 million and $716.9 million, respectively.
- Government Segment Leads Growth: Revenue from the Government segment grew by 66% year-over-year in the three-month period and 71% in the six-month period, indicating robust demand from this sector.
- Improved Gross Margins: Gross margin improved to 76% for the three months ended June 30, 2021 (82% excluding stock-based compensation) and 77% for the six months (83% excluding stock-based compensation), reflecting increased efficiencies.
- Increased Operating Expenses Driven by Stock-Based Compensation: Total operating expenses saw a significant increase, primarily driven by higher stock-based compensation expenses across sales and marketing, R&D, and general and administrative functions.
- Strong Liquidity Position: The company maintained a healthy cash position with $2.3 billion in cash and cash equivalents as of June 30, 2021, and an undrawn $400 million revolving credit facility.
- Customer Growth and Expansion: Palantir served 169 customers by June 30, 2021, up from 137 in the prior year, with average revenue per customer increasing by 19%.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q2 FY2021, Palantir Technologies Inc. lost $0.37.
- Revenue$375.6M100.0%
- Cost of revenue−$90.9M24.2%
- Gross profit$284.7M75.8%
- Operating costs−$430.9M114.7%
- Operating income−$146.1M38.9%
- Interest, other & tax$7.6M2.0%
- Net income−$138.6M36.9%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2021filed August 12, 2021Financial Statements
Q2 FY2021 against Q2 FY2020
| Line item | Q2 FY2021Q2 FY2020 | Change |
|---|---|---|
| Revenue | $375.64M$251.89M | +49.1% |
| Cost of Revenue | $90.93M$68.41M | +32.9% |
| Gross Profit | $284.72M$183.48M | +55.2% |
| R&D Expenses | $110.52M$86.81M | +27.3% |
| Operating Expenses | $430.86M$282.62M | +52.5% |
| Operating Income | -$146.15M-$99.14M | −47.4% |
| Interest Expense | $590K$5.65M | −89.6% |
| Net Income | -$138.58M-$110.45M | −25.5% |
| EPS (Basic) | $-0.07$-0.17 | +58.8% |
| EPS (Diluted) | $-0.07$-0.17 | +58.8% |
| Shares Outstanding (Basic) | 1.89B640.45M | +195.8% |
| Shares Outstanding (Diluted) | 1.89B640.67M | +195.7% |
05—Questions
Frequently Asked Questions
What is Palantir's revenue performance for the period?
For the three months ended June 30, 2021, Palantir reported $375.6 million in revenue, a 49% increase compared to $251.9 million in the same period last year. For the six months ended June 30, 2021, revenue was $716.9 million, a 49% increase from $481.2 million in the comparable prior period.
Is Palantir profitable based on this report?
Palantir continued to report net losses for the period. For the three months ended June 30, 2021, the net loss was $138.6 million, compared to a net loss of $110.5 million in the prior year. For the six months ended June 30, 2021, the net loss was $262.1 million, compared to $164.7 million in the prior year. However, adjusted income from operations, which excludes non-cash stock-based compensation and related payroll taxes, showed significant positive growth.
What drove the increase in operating expenses?
Operating expenses increased significantly, driven largely by higher stock-based compensation expenses. These costs were elevated across sales and marketing, research and development, and general and administrative functions, primarily due to the recognition of expenses related to Restricted Stock Units (RSUs) and, to a lesser extent, employer payroll taxes related to share-based payments.
How is Palantir's financial health and liquidity?
Palantir maintains a strong liquidity position. As of June 30, 2021, the company had $2.3 billion in cash and cash equivalents. Additionally, the company had an undrawn revolving credit facility of $400 million available and had fully repaid its outstanding term loans of $200 million during April 2021, indicating a solid financial footing.
06—Continue