New York, Feb 3, 2026, 13:37 ET — Regular session
- Palantir shares climbed despite a drop in the Nasdaq amid renewed selling pressure in software stocks
- U.S. government revenue surged in the latest quarter, while the company raised its sales forecast for 2026.
- Investors are now shifting focus to Alphabet and Amazon results due later this week
Palantir Technologies (PLTR.O) shares jumped roughly 6% on Tuesday, defying a wider tech sell-off. The boost came after the company highlighted robust demand for its artificial intelligence tools among U.S. government agencies.
This shift is significant as the market grows jittery over software valuations, with investors debating which AI leaders will maintain pricing power as fresh models emerge. Palantir’s surge seemed like a nod to solid contracts and cash flow, rather than mere hype.
Around 1:37 p.m. ET, the stock climbed 6.4% to $157.27, having bounced between $153.18 and $165.65 earlier.
Palantir reported a 66% jump in U.S. government revenue for the fourth quarter, reaching $570 million. This helped push total sales to $1.41 billion, beating analysts’ forecasts as defense budgets expanded and agencies increased reliance on its “military-grade” software. The company expects first-quarter sales to exceed Street estimates and projected 2026 revenue between $7.18 billion and $7.20 billion, signaling growth north of 60%. Reuters
CEO Alex Karp took the earnings call as a chance to defend Palantir’s surveillance efforts, emphasizing that the technology has built-in safeguards to prevent overreach. He added that the company is “supporting in a critical manner” U.S. government operations, though he didn’t specify which programs. Reuters
The rally unfolded while Wall Street dumped much of the software and cloud sector. The S&P 500 and Nasdaq slipped, weighed down by losses in Microsoft, Salesforce, Snowflake, and Adobe. Investors worried about how fast AI might disrupt established business models. “Many areas, especially around AI, are priced for perfection,” noted John Campbell, senior portfolio manager at Allspring Global Investments. Reuters
The story isn’t straightforward. Palantir remains heavily tied to government budgets, and its involvement in sensitive contracts invites political and investor scrutiny that spreadsheets can’t capture. Any sharp drop in new contracts or stricter oversight would quickly undercut the growth story.
Traders will be watching closely in the coming days for follow-through on Palantir’s guidance and any hints that government-driven demand is spilling over into commercial deals. At the same time, mega-cap tech earnings could shake up the AI narrative.
Alphabet will release its fourth-quarter and full-year 2025 earnings on Feb. 4.
Amazon will report its fourth-quarter 2025 results on Feb. 5.
