The AI trade continues to steal the show.
Palantir (PLTR) has the hottest ticker page on Yahoo Finance today after the company’s stellar earnings last night. The defense tech play broke $1 billion in sales in a quarter for the first time.
Co-founder and CEO Alex Karp — wearing a white T-shirt on the earnings call — signaled the AI revolution is just beginning and haters should consider giving up their bear cases on the stock.
“So thank you for all of our supporters, and we should entertain questions, but this is a once-in-a-generation truly anomalous quarter, and we’re very proud, and we’re sorry that our haters are disappointed, but there are many more quarters to be disappointed, and we’re working on that too,” Karp opined.
Pouncing on the AI optimism, Bank of America published a bullish note on Nvidia (NVDA) weeks ahead of its Aug. 27 earnings report.
Analyst Vivek Arya said Nvidia’s quarterly sales will easily beat estimates and third quarter guidance will be upbeat due to Blackwell chip demand. If there is a hiccup in the quarter and outlook, Arya warns it could come from China — where Nvidia’s H20 chip may be subject to potential security probes by Chinese regulators.
Arya’s $220 price target assumes about 22% upside in Nvidia’s stock from current levels.
“It’s really gravity-defying how much capex is going into AI,” Lou Basenese, chief strategist at the Basenese Group, told me on Yahoo Finance’s Opening Bid.
All this as investors buy the slight dip in the markets ahead of a potential Fed rate cut in September.
But without question, Palantir’s results left a mark on the minds of investors.
Palantir cleaned up on government business and large companies in the quarter.
Results beat estimates and accelerated from the first quarter. Karp took to his soapbox on the earnings call to slam critics and hype up his business.
Here are the earnings day wins:
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Sales up 48% from the prior year.
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US commercial operating margins advanced 890 basis points year over year.
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The top line accelerated sequentially by major business segment.
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Bookings growth accelerated sequentially.
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Full-year sales guidance was raised by 6 percentage points to 45% year over year vs. previous expectation of 36% year over year. The implied fourth quarter revenue guidance was 10 percentage points ahead of consensus, implying revenue growth in the low-40s versus consensus expectations of 32%.
“Palantir delivered a show-stopping Q2,” Citi analyst Tyler Radke said.
Shares rose 8% on the session.
