Palantir commercial revenue surpasses government contracts
U.S. commercial clients now drive more revenue than government contracts for the AI firm, signaling a major business shift.
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Palantir Technologies reported a significant shift in its business model during the third quarter of 2026, as U.S. commercial revenue outpaced the company's government sector for the first time. The company generated $984 million from commercial clients in the U.S., compared to $953 million from U.S. government contracts for the period ending Sept. 30, 2026.
Total revenue for the quarter reached $2.313 billion, representing a 96% increase compared to the same period last year. The company saw U.S. commercial revenue grow by 148% year-over-year, while the U.S. government segment grew by 96%. GAAP diluted earnings per share were reported at $0.44.
CEO Alex Karp attributed the shift to the Sovereign AI movement, which he described as a force driving institutions toward a dichotomy between those utilizing advanced AI and those that are not. Karp stated that the company's products, including Foundry, Ontology, and AIP, are designed to align workflows with optimal models to support this transition.
Following the release of these results after the market closed on Nov. 2, 2026, Palantir increased its full-year 2026 revenue guidance to a range of $8.530 billion to $8.534 billion. The company projects revenue for the fourth quarter to fall between $2.649 billion and $2.653 billion.