PALANTIR STOCK FALLS DESPITE RECORD RESULTS
For Q3 2025, Palantir delivered revenue of US$1.181 billion (about S$1.61 billion), up 63% year-on-year, easily beating analyst expectations of US$1.09 billion. Adjusted EPS came in at US$0.21 (+110% y/y), while GAAP profit surged 231% to US$476 million (S$648 million). Free cash flow rose 46% to US$540 million (S$736 million). The company now sits on a massive US$6.4 billion (S$8.7 billion) cash pile and has zero debt. U.S. commercial revenue jumped a stunning 121%. Management raised guidance again — Q4 revenue is projected at US$1.33 billion (S$1.8 billion), versus the US$1.19 billion expected, and full-year 2025 revenue between US$4.396–4.400 billion (+53%). Despite these blockbuster results, PLTR stock fell 7.2% on Tuesday’s session, closing near US$192 after touching an intraday low of US$185. Year-to-date, the share remains up 156%, giving Palantir a market cap of around US$450 billion (S$612 billion). For Singapore investors, this is a timely reminder that even strong fundamentals can’t always offset market psychology and inflated valuations.
Why did the market react negatively?
It wasn’t about bad numbers — it was about expectations. Palantir’s share price had already priced in perfection. Heading into earnings, the stock was trading at 229× forward free cash flow and over 200× forward earnings — levels that would make even some hot SGX tech names look conservative. When expectations run that high, even “great” isn’t good enough.
Profit-taking after a massive run
Palantir had rallied over 150% since January. So when results landed, short-term traders took the opportunity to lock in profits — a classic “sell the news” event. Singaporean investors will recognise the pattern: it’s like how Sea Ltd or Grab shares sometimes dip even after solid reports, simply because valuations were stretched too far.
AI bubble worries and global sentiment
Adding to the pressure, the Nasdaq fell 2% the same day amid renewed “AI bubble” fears. Many tech names with high multiples saw pullbacks, and Palantir — seen as a pure-play AI stock — bore the brunt of the sell-off. Global investors have become more cautious, much like how Singapore’s own markets react when MAS tightens liquidity or when US tech sentiment dips.
The Michael Burry shock
A U.S. 13F filing added to the drama: “Big Short” investor Michael Burry held massive put options — US$912 million against Palantir and US$187 million against Nvidia — representing 80% of his portfolio. Even though the data was 45 days old, headlines screamed “Big Short 2.0,” triggering knee-jerk selling by algorithms and retail traders alike.
Valuation: >200× forward earnings
Nasdaq fell 2% on AI-bubble fears
Michael Burry’s puts spooked investors
Algorithmic trading amplified losses
Profit-taking after 156% YTD rally
In short, this wasn’t a business problem — it was sentiment-driven volatility, something every SGX investor familiar with global tech stocks has seen before.
Solid fundamentals, strong guidance
Despite the sell-off, Palantir’s underlying fundamentals remain world-class. The company is growing fast, staying profitable, and maintaining a balance sheet most firms would envy. It’s a rare combination in the volatile AI sector.
Explosive growth in commercial segment
Palantir’s U.S. commercial revenue surged 121%, driven by private-sector adoption of its AIP (Artificial Intelligence Platform). The platform is being used by clients in industries like healthcare, defence, and logistics — much like how Singapore’s own AI innovation drive, backed by Smart Nation initiatives, is transforming industries from finance to supply chain management.
A fortress balance sheet
Palantir’s cash position of US$6.4 billion (S$8.7 billion) and zero debt gives it flexibility to invest heavily in R&D, expand across Asia, and weather global headwinds. It’s the kind of balance sheet resilience that long-term investors on SGX value in firms like DBS or Keppel Corp.
Raised guidance — again
Management raised full-year 2025 guidance for the fourth time in a row: Q4 revenue expected at US$1.33 billion (S$1.8 billion), with adjusted free cash flow projected between US$1.9–2.1 billion (S$2.6–S$2.8 billion). That level of consistency reinforces investor confidence in the company’s growth trajectory.
Revenue: +63%
EPS: +110%
GAAP Profit: +231%
Free Cash Flow: +46%
Cash: US$6.4B
Debt: 0
Few global tech firms can boast these numbers. Palantir’s blend of growth and profitability makes it a standout — even in a frothy AI market.
Opportunity for long-term investors?
For short-term traders, the 7% drop stings. But for long-term investors who believe in the compounding power of AI, this could be a golden buying opportunity. Palantir remains one of the world’s most influential software companies shaping the future of enterprise AI.
AIP as the growth engine
Palantir’s AIP is fast becoming mission-critical for corporations adopting AI at scale. Each new customer adds to the network effect and strengthens recurring revenue. Think of it as the enterprise backbone for AI — similar to how Temasek-backed firms build infrastructure for Southeast Asia’s digital economy.
Technical support and valuation context
The US$185–190 (S$252–S$260) zone has held as strong technical support. With a recent high of US$207 (S$283), the correction looks more like healthy consolidation than a reversal. Long-term investors who’ve been buying dips below S$260 have generally been rewarded in 2025.
+156% YTD before correction
AI still in early innings globally
Debt-free, strong liquidity
Consistent execution and expansion
Support zone ~S$255
For Singaporean investors looking for global exposure to the AI boom, Palantir offers a rare mix of profitability, innovation, and long-term scalability. It’s the kind of stock you accumulate — not chase — on red days. As local traders say, “buy when there’s fear, not when there’s hype.”
