Palantir surges after Q2 results as AI products see hyper growth demand, says Wedbush

Shares of Palantir Technologies (NASDAQ:PLTR) jumped about 6% premarket on Tuesday after second quarter results and outlook exceeded expectations which also drew praise from analysts at Wedbush.

The firm maintained its Outperform rating on Palantir and raised the price target on the stock to $200 from $160.

Analysts led by Daniel Ives said they maintained the rating and raised the price target reflecting continued hyper growth demand for the company’s AI product suite with the use case era of the AI Revolution now here.

The analysts added that this was another eye-popping quarter for the company as its Artificial Intelligence Platform, or AIP, continues gaining unprecedented interest across the commercial landscape with U.S. Commercial front and center seeing 93% year-over-year growth with more enterprises looking to Palantir for complex AI use cases.

“We believe in the next few years Palantir has the potential to be a trillion dollar market cap as the AI Revolution takes hold,” said the analysts.

Ives and his team said U.S. Commercial remained the star of the show, seeing 93% year-over-year growth and 20% quarter-over-quarter with this segment now representing over 30% of total revenue as the company sees faster starting rates and existing customer contract expansions.

The company has also seen its U.S. Commercial Total Contract Value, or TCV, increase 222% to about $843M while closing $2.79B up 141% year-over-year as the company continues capitalizing on AI production use cases.

“We believe Palantir has a “golden path to become the next Oracle” over the coming years and will grow into its valuation,” said Ives and his team.