"Despite doing everything right for Q3, shares dipped more than 4% in the after-hours. It's a confusing post-earnings reaction on the surface, but when you consider the sky-high valuation and the momentum behind the name, it makes sense that anything short of a shocking blowout wouldn't be able to do it. Just how much of the big beat was already baked in remains the big question."
"Either way, I think a good argument could be made that Palantir did deliver a blowout of sorts, with revenue and earnings per share numbers blasting off. The AI segment, in particular, was a strong point, and with very little to nitpick, some new investors may find it strange that shares are selling off in response."
"Perhaps an even bigger blowout would have been met with profit-taking since it is that time of year again, when it's time to get in ahead of the traders looking to do a bit of year-end tax loss selling. And with huge gains already in the books, selling after a mild blowout (if you can even call it that) doesn't seem like all too bad an idea."
Palantir delivered a very strong quarterly result and raised Q4 guidance, driven by significant AI-related growth. Revenue and earnings per share substantially beat expectations, with the AI segment highlighted as a standout. Shares fell over 4% in after-hours trading despite the positive results, reflecting a market that may have largely priced in strong outcomes and is sensitive to stretched valuation and momentum. Selling pressure likely reflects profit-taking and year-end tax-loss strategies, and concerns remain that richly valued AI names could be vulnerable if the AI rally cools. Shares remain expensive even after the decline.
Read at 24/7 Wall St.
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