Palantir Technologies Stock

Palantir Technologies Inc. and its subsidiaries (Palantir) build and deploy software platforms that serve as the central operating systems for its customers.

The company builds software that empowers organizations to effectively integrate their data, decisions, and operations at scale. The company builds software for the intelligence community in the United States to assist in counterterrorism investigations and operations. The company also works with commercial enterprises, who often faced fundamentally similar challenges in working with data.

The company has built four principal software platforms, Palantir Gotham (‘Gotham’), Palantir Foundry (‘Foundry’), Palantir Apollo (‘Apollo’), and Palantir Artificial Intelligence Platform (‘AIP’). Gotham and Foundry enable institutions to transform massive amounts of information into an integrated data asset that reflects their operations, and AIP leverages the power of the company’s existing machine learning technologies alongside large language models (‘LLMs’) directly within Gotham and/or Foundry to help connect AI to enterprise data. Gotham has surfaced insights for global defense agencies, the intelligence community, disaster relief organizations and beyond. And Foundry is becoming a central operating system not only for individual institutions but also for entire industries. Apollo, which the company began offering as a commercial solution in 2021, is a cloud-agnostic, single control layer that coordinates ongoing delivery of new features, security updates, and platform configurations, helping to ensure the continuous operation of critical systems. Apollo allows the company’s customers to run their software in virtually any environment.

In 2023, the company began deploying its newest offering, AIP, which is designed for customers across the commercial and government sectors, enabling them to derive value from recent breakthroughs in artificial intelligence via the combination of the company’s existing software platforms with LLMs. AIP uniquely allows users to connect LLMs and other AI with their data and operations to facilitate decision-making within the legal, ethical, and security constraints that they require.

Recent crises and systemic shocks, such as the ongoing Russia-Ukraine and Israel conflicts, have made clear to many of the company’s customers that accommodating the extended timelines ordinarily required to realize results from implementing new software solutions is not a viable option. As a result, customers are increasingly adopting the company’s software, which can be ready in days, over internal software development efforts, which may take months or years.

Platforms

The company has built four principal software platforms: Gotham, Foundry, Apollo, and AIP. The company’s software platforms provide the critical infrastructure needed to integrate the company’s customers’ data and operations and run their software in virtually any environment.

The vertically integrated nature of these platforms allows users of varying technical abilities to collaborate effectively in the company’s platforms. Data engineers can integrate new data sources, analysts can clean and transform data, data scientists can write models, business users can conduct daily workflows, and senior leaders can make critical decisions. With AIP, trusted data from relevant sources can be integrated into business logic, machine-language models, optimizers, and other computations spread across varying environments to power enterprise processes and help drive critical decisions. Customers may bundle these platforms together as a single ecosystem.

Data, analyses, decisions, and the metadata around each are secured with fine-grained access controls that propagate from source data to shared analyses. Each platform is consisted of user-facing applications that may be targeted to the specific industries and sectors in which they are used.

Despite their differences, Gotham and Foundry both serve as central operating systems for the company’s customers. While they vary in specific functionality, they align in approach. AIP provides an integrated architecture to Gotham and Foundry that can bring AI to every decision. These platforms, backed by Apollo, can be deployed in almost any environment.

Similarly, customers can now use Apollo to enable continuous deployment, configuration management, and central software operations management across almost any environment for their own software products.

Gotham

Gotham enables users to identify patterns hidden deep within datasets, ranging from signals intelligence sources to reports from confidential informants. It also facilitates the hand-off between analysts and operational users, helping operators plan and execute real-world responses to threats that have been identified within the platform. Gotham is now used broadly across government functions, and the company also offers Gotham to the company’s commercial customers.

Foundry

Foundry transforms the ways organizations operate by creating a central operating system for their data. Individual users can integrate and analyze the data they need in one place. The speed with which users can experiment and test new ideas is what makes the software stick.

Data projects often fail because the steps and methods used to build data pipelines are difficult to understand and recreate. The company builds Foundry’s backend to solve the root of this problem. The platform’s graphical interface does the rest, allowing users to track and trace their pipelines so they know what the rows and columns in their tables represent and why they are there. All of the company’s commercial customers now use it, as do several of the company’s government customers.

AIP

AIP enables responsible AI-advantage across the enterprise by using primary, core components built to effectively activate LLMs and other AI within any organization. It provides unified access to open-source, self-hosted, and commercial LLMs that can transform structured and unstructured data into LLM-understandable objects and can turn organizations’ actions and processes into tools for humans and LLM-driven agents. AIP can allow organizations to power operational use of AI and LLMs with interfaces for decision making, feedback, and safe hand-off among AI agents and human operators with wide-spectrum security and audit controls, which allow for granular control over model usage and integrated human review checkpoints throughout the workflows. AIP is designed to be seamlessly bundled with existing Palantir offerings such as the Foundry, Gotham, and Apollo platforms.

Apollo

The company has always prioritized meeting its customers wherever they need the company most. The company originally builds Apollo to enable the continuous delivery of its software wherever the company’s customers are in the cloud, on-premises, or even more rugged environments. Apollo enables the rapid, secure delivery of the company’s software and updates across its business, and also enables the company’s customers to securely deploy their own software in virtually any environment. Apollo provides a single control layer to coordinate ongoing delivery of new features, security updates, and platform configurations.

Customers

The company works with many of the world’s leading government and commercial institutions. As of December 31, 2023, the company had 497 customers.

The company’s software is used across approximately 80 industries around the world. It is applied to a variety of use cases by users across various business functions and levels of organizations, including by utility operations analysts, automotive manufacturing workers, oil and gas technicians and operators, and pharmaceutical researchers in the United States; supply-chain managers in South Korea; assembly workers in France; public health administrators in the United Kingdom and the United States; and special forces personnel and military officials in the United States and abroad.

The company’s business continues to have a global presence. In 2023, the company earned 62% of its revenue from customers in the United States, and 38% from those abroad.

Sales and Marketing

The company’s approach to sales and marketing is built around discussions with existing and prospective customers in order to understand the principal challenges the company’s customers face and identify ways in which the company’s software platforms can provide long-term value and results. Beginning in 2023, the company introduced AIP bootcamps to the initial stages of its customer acquisition process, which helped to accelerate these discussions and provide an opportunity for the company’s customers to experience its platforms through their own use cases in days.

Direct Sales Force

The company has invested and may continue to invest in an account-based sales force to identify and capture new customers and opportunities.

The company’s decision to build its sales force in recent years has resulted in multiple new customers, and the broadening and expansion of the company’s commercial customer base and relationships with leading government agencies around the world.

Sector and Industry Operating Systems

In addition to supporting individual institutions, the company’s platforms have become central operating systems for entire industries and sectors. The company is developing industry operating systems to help companies and government agencies manage operations across their entire organizations. These operating systems allow the company’s software to be distributed at scale to institutions within given industries. The company has and is continuing to develop partnerships in the airline, insurance, healthcare, automotive, security and risk management, and government sectors, which the company anticipates will have a significant impact on its business moving forward.

The U.S. Government

The company is uniquely positioned to provide commercially available software to the U.S. federal government. The company’s government customers remain a meaningful and resilient source of revenue for the company’s business. The company intends to capture an even greater share of the U.S. federal government spending on software systems.

Channel Sales & Cloud Partnerships

The company has entered into, and continues to explore the development of, partnerships for specific industries and sectors by partnering closely with leading providers of public, private, and hybrid cloud services, which have relationships with essentially every major enterprise in the world and have large, existing sales forces. These cloud partnerships emerged as an extension of the large computing requirements for the company’s platforms and the migration towards the cloud as the hosting environment of choice for many customers. The existing footprint of these providers provides the company with access to their large customer base and expands its distribution capabilities.

The company has also continued to explore the establishment of channel sales relationships and similar alliances with public and private organizations, opening a path for the company to partner with varying providers, including smaller technology providers.

Joint Ventures & New Business Partnerships

The company intends to continue to form joint ventures and new business partnerships, where specific industries or sectors require a partner and additional investment in order to realize the full potential of the company’s platforms. For example, in December 2023, the company, through Palantir Technologies Japan KK, entered into a strategic global partnership with Fujitsu Limited through which the parties will incorporate the capabilities of Foundry and AIP as a key element in the data infrastructure for Fujitsu Uvance, a portfolio of global solutions that address business challenges and solve societal issues.

Account Growth

There are a number of sales and marketing strategies that the company uses to drive revenue growth at an account. These strategies include creating new ecosystem partnerships to extend the platform beyond the customer’s four walls into the operations of its partners and suppliers; selling additional productized cross-industry software capabilities; and selling strategic implementations of the company’s software against specific use cases, which deliver competitive differentiation.

The company’s sales and marketing strategies allow the company to scale existing customer contracts horizontally to include additional divisions or functions within a single institution and vertically to include additional users and user groups. In tackling the customer’s most pressing and challenging problems first, the company establishes the trust needed to expand platform usage across the full enterprise.

Customer Impact

Some examples of the ways in which the company’s software facilitates data protection for the company’s customers follow below.

The company’s platforms serve as the central analytics system of a major law enforcement agency in northern Europe. Scandinavia has long been at the forefront of data protection, and the company’s software facilitates effective implementation of its rigorous privacy policies.

A financial institution required strong cryptographic guarantees of access control and selective revelation for sensitive client information on a need-to-know basis. Palantir Foundry’s integrated obfuscation tool for cryptographic processes provided both IT and data governance teams with the necessary functionality and security assurances to establish privacy and governance safeguards in operational workflows carried out by non-technical users. This service, in conjunction with system-wide advanced encryption at both storage and network levels, helps to ensure continuous security guarantees for data throughout the full data use and management lifecycle.

A customer in Europe needed to adhere to rigorous purpose specification and proportionality requirements during sensitive analytical workflows. The company worked with the customer to implement technical measures requiring analysts to provide reviewable justifications for access. Those controls were further supported by auditing capabilities to ensure that data processing satisfied legitimate purposes under the relevant regulations.

The company’s platforms provide a secure, privacy-protective cloud-based data enclave, which centralizes data on COVID-19 for collaborative clinical research.

Intellectual Property

The company has registered ‘Palantir’ as a trademark in the United States and other jurisdictions. The company also has registered trademarks for ‘Gotham,’ ‘Palantir Foundry,’ and the company’s corporate logo; and is the registered holder of a variety of domestic and international domain names that include ‘Palantir,’ including most importantly, ‘Palantir.com’.

Seasonality

The company generally experiences seasonality in the timing of recognition of revenue as a result of the timing of the execution of its contracts as the company has historically executed many of the company’s contracts in the third and fourth quarters (year ended December 2023) due to the fiscal year ends and procurement cycles of the company’s customers and at times the company may start work prior to finalizing such contracts.

History

Palantir Technologies Inc. was founded in 2003. The company was incorporated in Delaware in 2003.