01—Abstract
Summary
Summary of the 10-Q filed August 8, 2023. Cited figures are marked; the original filing is the authoritative source.
Palantir Technologies Inc. reported solid financial results for the second quarter of 2023, demonstrating continued revenue growth and a significant improvement in profitability.
Total revenue reached $533.3 milliona, an increase of 13% year-over-year, driven by growth in both government and commercial segments. The company achieved income from operations of $10.1 million, a substantial improvement from a loss in the prior year period. This turnaround is partly attributed to a reduction in stock-based compensation expenses, which decreased by 22% year-over-year, impacting operating expenses favorably.
Financially, Palantir ended the quarter with a strong liquidity position, holding $3.1 billionb in cash, cash equivalents, and short-term U.S. treasury securities, with no outstanding debt. The company also announced a new $1 billion stock repurchase program, signaling confidence in its future financial performance and commitment to shareholder value.
02—Key points
Key Highlights
- Revenue increased by 13% year-over-year to $533.3 million, with government segment revenue up 15% and commercial segment revenue up 10%.
- Achieved income from operations of $10.1 million, a significant improvement from a loss of $41.7 million in the prior year's quarter.
- Gross margin improved to 80% from 78% in the prior year's quarter, driven by revenue growth outpacing cost of revenue increases.
- Total operating expenses increased slightly by 1%, primarily due to increases in Sales and Marketing and Research and Development, while General and Administrative expenses decreased by 15%.
- Stock-based compensation expense decreased by 22% year-over-year, contributing to improved profitability.
- The company generated $277.6 million in net cash from operating activities for the first six months of 2023, compared to $97.9 million in the same period of 2022.
- Announced a new stock repurchase program authorizing up to $1.0 billion of Class A common stock.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2023, Palantir Technologies Inc. kept $0.05.
- Revenue$533.3M100.0%
- Cost of revenue−$106.9M20.0%
- Gross profit$426.4M80.0%
- Operating costs−$416.3M78.1%
- Operating income$10.1M1.9%
- Interest, other & tax$18.1M3.4%
- Net income$28.1M5.3%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2023filed August 8, 2023Financial Statements
Q2 FY2023 against Q2 FY2022
| Line item | Q2 FY2023Q2 FY2022 | Change |
|---|---|---|
| Revenue | $533.32M$473.01M | +12.7% |
| Cost of Revenue | $106.90M$102.22M | +4.6% |
| Gross Profit | $426.42M$370.79M | +15.0% |
| R&D Expenses | $99.53M$88.17M | +12.9% |
| Operating Expenses | $416.34M$412.53M | +0.9% |
| Operating Income | $10.07M-$41.74M | +124.1% |
| Interest Expense | $1.32M$670K | +96.6% |
| Net Income | $28.13M-$179.33M | +115.7% |
| EPS (Basic) | $0.01$-0.09 | +111.1% |
| EPS (Diluted) | $0.01$-0.09 | +111.1% |
| Shares Outstanding (Basic) | 2.13B2.05B | +3.7% |
| Shares Outstanding (Diluted) | 2.28B2.05B | +10.9% |
05—Questions
Frequently Asked Questions
What was Palantir's revenue growth in Q2 2023?
Palantir's total revenue for the three months ended June 30, 2023, was $533.3 million, representing a 13% increase compared to $473.0 million in the same period of 2022. For the six months ended June 30, 2023, revenue was $1.06 billion, a 15% increase from $919.4 million in the prior year period.
Did Palantir achieve profitability in Q2 2023?
Yes, Palantir reported an income from operations of $10.1 million for the three months ended June 30, 2023, a significant improvement from a loss of $41.7 million in the same period of 2022. The company also reported a net income of $27.9 million for the quarter, compared to a net loss of $179.3 million in the prior year quarter.
How did stock-based compensation impact the results?
Stock-based compensation expense decreased by 22% year-over-year, totaling $114.2 million for the three months ended June 30, 2023, compared to $145.8 million in the prior year. This reduction contributed positively to the company's operating expenses and improved profitability.
What is the company's liquidity position?
As of June 30, 2023, Palantir had $1.06 billion in cash and cash equivalents and $2.05 billion in marketable securities, totaling approximately $3.1 billion in highly liquid assets. The company had no outstanding debt and believes its liquidity is sufficient to meet its operating needs for at least the next twelve months.
06—Continue