As Palantir Technologies Inc. (NASDAQ:PLTR) reached new all-time highs this week, ARK Invest‘s Chief Futurist Brett Winton outlined how the company’s platform transforms large language models into specialized business intelligence tools, positioning it as a critical infrastructure layer in the AI revolution.
Record Quarter Drives Valuation Debate
Palantir posted $1 billion in second-quarter revenue, surpassing analyst estimates of $939.71 million, while achieving its eighth consecutive quarter of GAAP profitability. The company now trades at approximately 100 times sales with a $410 billion market cap based on expected $4 billion annual revenue.
“I have never seen a company trade at 100 times sales,” said RiskReversal Media host Dan Nathan during a recent interview with Winton, questioning whether the valuation represents “one of the biggest bubbles in stock market history.”
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Platform-as-a-Service Strategy Explained
Winton defended Palantir’s premium valuation by explaining its position in the software revenue stack. Rather than competing with traditional software-as-a-service companies, Palantir’s Foundry platform enables enterprises to build custom applications directly.
“The gyms of the world are no longer going to go to MindBody. They’re going to be like, ‘Hey, we need an appointment app. Let’s just spin it up ourselves,'” Winton explained, noting that only 10% of AI software spending will flow to traditional SaaS providers.
ARK Maintains Strategic Position
Despite Cathie Wood‘s recent $28 million share sale at record highs, Palantir remains ARK Innovation ETF’s seventh-largest holding at 5.04% of the portfolio. Wood’s profit-taking strategy comes as the stock gained 147.2% year-to-date.
ARK itself uses Palantir’s platform for investment analysis, applying AI language models to company data for underwriting decisions. “For very big enterprises that have lots of data streams, Palantir is setting itself up as the operating system layer,” Winton said.
Analyst Targets Rise on Growth Momentum
Wedbush Securities raised its price target to $200, citing “hyper growth demand” for Palantir’s AI platform. The company reported 93% year-over-year growth in U.S. commercial revenue and 43% customer growth, prompting management to raise full-year guidance to $4.14-4.15 billion.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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