Is Palantir Stock Still a Buying Opportunity? | Feat. Emir (Type-F)

I was recently joined by Amir from TypeF Capital. Amir is a longtime Palunteer investor, equity researcher, and has spent more than a decade in IT administration. In this conversation that I had with Amir, I wanted to learn more about Palunteer, why he's investing in it, and why now is potentially a better opportunity to get into Palunteer than ever. Thank you to Amir for joining this podcast. It's full of amazing Palunteer insights, but please enjoy the conversation with Amir. What got you interested in Palanteer in the first place? like why um did this company catch your eye versus other software names or what what stood out? >> Yeah. So there was this kind of mystique about Palanteer. Everyone was talking about it like as if it was a black box. So that really you know sparked a curiosity and you know with the founders you know Peter Teal was involved. So there there was a lot of like interest like okay let's see what this is about. So that's really why I started looking into it and the more I looked the more I re I realized that it's not really a black box. But when you read about it, you know, um are you familiar with Resident Evil and the Umbrella Corporation? >> I mean a little bit, but >> yeah. So it's like this evil company that like developed the T- virus and spread like the the zombie plague and stuff. this like all powerful like global company that looks nice on the outside but actually they're doing a lot of e evil stuff behind the scenes. So that was kind of the vibe I got about Palunteer. It's like just like the real life umbrella corporation at least from you know what what what you read about the company but you know the more I looked into it >> today right? >> Yeah I mean depending on where you get your news from. Yeah. Uh but yeah, so after that um you know I I realized that there was more to the company and what what I found was like yeah it's a hidden gem that the market is sleeping on. So followed it from that point on. Well, so you know, obviously looking at the company's financials growing at 12% back in the day whenever it was like, you know, $15 a share to now being at one point hundreds of dollars, but also growing at like 85%. Trying to understand this company's fair value has been hard over time because the fundamentals have changed so much and the stock price has as well. So, where do you get the confidence in believing that there's still upside to this company? Where do you see it next? I if there's a new investor that's trying to, you know, potentially look to invest in this company, what do they need to focus on? >> Yeah. So, maybe I'll um show you. I I think visualizing is nice. >> Sure. >> Okay. So yeah, you're talking about this point in time when it grew 12.5%. So the interesting part here is when when Palanteer went public uh back in 2020. So they made this promise that okay, we're going to compound revenue at 30%. Right? So that's really what got everyone hyped. They're like, oh well, if you compound at 30% over the next five years, which they were talking about, uh that obviously means a lot of revenue inbound for the company at the time. But as uh time went on you know the initial quarters they were like 43% 52 40 49 49 and then it just started dropping and uh back here in 2022 so about you know a year and a half two years into it after going public they suddenly removed that 30% keer target that a lot of people nervous and then it continued dropping you know year-over-year 26% 22 18 18 13% you know reaching that 12.5% low. So obviously rounded up here and a lot of investor confidence was shattered but then at this point in time something magical happened which is they launched AIP and of course as an investor you couldn't know like okay how are they going to re accelerate this growth uh but during this point in time after they removed the 30% keer target uh an analyst in the Q2 2022 earnings asked car back then they actually had analysts on that wasn't just Dan Ice and you know the the Bank of America Mariana analyst and I well why did you remove the 30% keer like are you not able to meet that and he said no I'm I'm steering the company to 4.5 billion in 2025 and so you were like okay either we believe the CEO or you know we call a bluff and you know we you know just leave this company and many people just decided to stop investing in Palunteer So we didn't know how. Um obviously we saw that they don't really have a go to market. The the sales team was you know Alex Karp going to different companies like do you want to buy our software or not? So they didn't really have a go to market. They didn't really have a way to sell the software but the companies that did buy the software were really happy with it. So you knew that it wasn't a scam. Like at the time you had companies like um what what what's the EV company the scam one? uh N you remember like there's a lot of >> yeah Nicola and you had like so people are like I okay maybe it's not a scam company but you know but there was something there they launched AIP and every single quarter since they have managed to accelerate growth so and what makes me believe that to to answer your question this was kind of tangent what makes me believe that you know growth is not about to stop and the most important metric to track is actually looking at the um cohort growth. So let me see the chart here. So here we have two different lines. One line, the golden one is existing customers, customers that have been with Palunteer for 12 months or longer. And then we have new customers uh which is the black line. So this shows you how much of uh revenue growth is being contributed by existing customers and how much is being contributed by you know those that have been with Palunteer for a year or longer. And as you can see here even if Palanteer didn't record a single new customer in the past 12 months they would have grown revenues 50% in Q1 of 2026. And this has been accelerating every single period since the launch of AIP. So what this shows you is the pure scalability of the software even though they're not really adding all all that many new customers. So if we go to to example to the to the co total customers here they're adding you know 53 42 uh 62 you know they're not really improving how many new customers they're adding. This growth is purely coming from existing customers expanding their contracts with Palunteer. And what does that tell you? It tells you that they are extracting so much value from utilizing Palanteer that the more they use it, the more they want to implement it across their whole enterprise. They want to use it for even more use cases for each passing period. And an even stronger case point is if you look at, you know, Palanteer has about 1,00 customers. 2% of that 1,00 contributes 42% of all revenue. So only >> 2% contribute 40% of the revenue. >> For yeah 40 42%. So the top 20 customers are almost half the revenue. And what's uh really interesting here is that if we go to the top 20 cohort growth um so so the black bars are uh revenue growth on a trailing 12-month basis. And as you can see here, the top 20 customers who are already spending, you know, over a 100red million each annually on average, they are actually scaling even faster than that 50% line. So they are actually, you know, approaching 60%. So the ones that are already spending massive massive amounts on Palunteer, they're actually the ones growing the fastest. So the scalability of this company is, you know, completely out of this world. like you won't find anything like this in the whole stock market. >> Yeah. >> Yeah. >> Uh so basically the way to look at it is would you pay $1 billion annually for Palunteer software? Well, the question is, yeah, you would if it brings you in 10 billion. Like, it's all a matter of scale, right? It it doesn't matter if the software is 1 million, 10 million, 100 million, or even a billion if the ROI is a lot higher than that, which is what customers are starting to see with AIP. So, what this shows us is that the pure scalability, you know, is is essentially endless. So because all of the growth or a majority of the growth is coming from you know existing customers um as they keep adding more customers and those customers start start scaling it really gives you breadth to the whole growth the the overall uh revenue growth that that you're seeing which you know US commercial was 133%. which actually this shows you that they decelerated growth and you're like uh you had this whole acceleration you know 92% 122 137 and and then it dropped you're like uh what's going on here or is the revenue growth you know finished uh actually no they reclassified some customers to to the government side from the commercial side so actually this would have been you know over 140%. So they would have accelerated even further this quarter. >> And re real quick because um you know you you're talking about all of these products that customers are using. >> Can you give some examples of the types of products or the problems that Palunteer software is solving? >> Yeah. So we have um the biggest kind of meme when when it comes to Palunteer is that no one really knows what Palunteer does. Sure. And the the reason for that is that Palunteer is not like a plugandplay kind of software. It's more like a platform. So So it's like saying uh what does even you know Microsoft Windows do? Well, it's a platform an operating system which you build upon. And if you look at these demos, they they for example host AIP cons where customers show how they're utilizing Palunteer. You see that like each customer is um utilizing it in a in a different way. So there isn't like a single you know one sentence reply okay Palanteer does this. No, like it's a platform where you build out uh solutions on top of uh to solve you know problems within your business use cases that could be anything from uh logistics chains to you know uh distributing beds in a hospital you know all of these different kind of use cases that ranges from basically any industry because they're last time I checked they're like available in more than across more than 50 different industries and sectors um all the way to the government and of course the u war uh segment as well which you know is getting a lot of flack online. So >> what is the what what's the specific advantage of using Palanteer? Why are they winning versus a Microsoft or a Salesforce or some of these other companies that have been around? >> Yeah. you know and and are essentially losing market share to Palunteer right now. >> Yeah. So the first thing is no no one really is competing with with Palanteer on the whole infrastructure layer, you know, uh a platform to build to build upon. But what really sets Palanteer apart from all of these different companies is that they were first to market with what they call an ontology. And what an ontology is is um basically a layered that provides context to all of your data inside your company. So let's say that I'm wearing this hat for example, right? If if you look at me, you see, well, it's a black hat. It has a Palanteer logo. So, so it's a Palanteer hat. With the ontology, you know what kind of stitching this hat has. You know which company did the stitching, like it provides all of this context to the hat. You you you know the input cost, the the output. you know like how it got to me from the like factory like all of these different kind of things about each data point inside your company. So when you map that out, you provide all of these LLMs with a lot of context. Uh which as I don't know if you've tried building with LLMs. I I have a lot and um it's really difficult when you have you know a large project with a lot of moving pieces like if you point it directly I want to do this dot like it can perform really really well but the more moving parts you add to the >> right right >> LLM the more confused it gets the the more frustrating it gets so the the ontology provides all of that context of your business to the LLMs which you helps when you build out all of these different use cases for um AIP the the platform itself. So that's why I think that it's become the go-to place for a lot of building that's going on and um there's a lot of reusability. You know, they're really now starting to introduce um what's it called de developer marketplaces. So you can reuse like oh this is how let's say that you're BP for example and then you have Exon Mobile probably these two companies are facing the same kind of issues they're trying to solve the same kind of problems so that's how really Palanteer survived in the early days is that they would go to a company with you know forward deployed engineers FDS as they call it these engineers would be with the company listen to like okay what are you trying to do here what kind of issues are you facing what What what kind of use cases are you trying to use our software for? They would build out a solution for that company. Then they would be able to resell it to every other company within the same sector like and the industry. >> Yeah. Yeah. >> So yeah, I think that's the advantage that they have the whole ontology layer uh the whole context layer and of course uh the guard rails. There's there's been a lot of talks lately about um LLM stealing IP launching competitive products. So there's really been a lot of lot lots of trust for you know using LLMs blindly and of and of course a palunteer is um model agnostic. You can plug in any model you want and it has like guardrails uh IP stays with you like it doesn't leak out. So there's a lot of advantages with using the Palanteer platform which is why I think it's uh managed to get such a huge part of the market this early on. But it is still like tiny. I mean, Palanteer has 1,000 customers basically. If you look at something like Salesforce, you're approaching 200,000 customers. Like, the scale is completely different, which also like goes into the first argument like u how long can revenue continue to grow? I mean, it's just a baby company. They have 1,000 customers. Like if you look at Pierce >> they're like um uh service now I think is approaching 25 30,000 salesforce 200,000 so like there's a lot of growth to be had a lot of companies to acquire so I know that there's been a lot of different startup products um for Palunteer like foundry for builders and foundry for startups and these sort of things trying to go after those smaller customers did those did any of those catch traction or of all the customers that Palanteer have are like of really big scale. Are they only dealing with Fortune 1000s or are they dealing with SMBs is really my question. >> No, they are they are mostly dealing with large customers and it's uh you know found for for builders it's free. You can go on AIP and start building for free essentially. They're really generous with the quotas and stuff like that. So what they want is to build expertise so that uh Palunteer foundry like expertise is available in the market because as Palanteer grows needs and stuff. >> Yeah. Right. So it's really beneficial in that way. But um >> what was I going to say? What what was the question again? Uh oh. >> Yeah. The large customer. So essentially for many quarters in a row now they've been outright saying like we c we can't meet demand >> and then you look at the employee force and they they're they're not hiring people. >> Yeah. >> It's it's it's kind of like they're bragging like uh yeah we we have no sales force >> and then you're like yeah okay you have no sales force you have all of this demand you are saying that that you can't meet it. Why don't you just hire people? And that's a good question like why don't they just hire more and expand you know downstream because now I I've heard of people that work at v various companies that have reached out to Palunteer and essentially being put on a backlog like yeah we unfortunately we we don't have capacity to deal with you right now. So they're mainly focusing on the larger companies. But a key point there is that one, it provides you a lot of a lot of pricing power when you can pick and choose. And two, when you target industry leaders and go for the for the big dogs and then everyone else in that industry starts to see how your margins improve, how your sales improve, like how more efficient you become as a company, >> then they want to get Palunteer as well. So it really trickles down over time but yeah they are they are not really uh scaling the way that as an investor you would have liked to see >> that that that's the interesting part right and I've been thinking about this you know they're not allowed to purchase back stock they've got $8 billion of total cash and cash equivalents why aren't they expand like I think Karp was just on CNBC bragging about how they're going to grow by 100% with fewer people. >> Yeah. What is what's the consensus across the you know the people who have been following Palunteer for much longer? There is no consensus. >> Yeah. Okay. We we can only speculate. Okay. Actually the the broad consensus of uh what should Palanteer do with their cash pile because early on even like early days before you know US commercial revenue growth was over 100%. They were like yeah we're not cash constrained for growth. and and you're like obviously you have no debt that like they haven't had the debt for like uh 3 four years. >> Yeah. >> Uh they just keep like putting all their cash into you know um tre treasuries to to farm that yield. >> Like okay, you're not cash constraint to grow. Then why aren't you growing more? Like it's a it's a big question like what should they do with all of this cash that just keeps you know growing because they're generating a a lot of cash. They're not using any cash. They have no no debt. So the consensus in general is that a lot of people including me would like to see investments into businesses that one share the same values as Palunteer which is something like an Andreel for example and also a lot of uh companies where Palanteer employees have left to do their own startups which there's a lot of successful companies like that where uh you It's widely known that the hiring process at Palunteer is really rigorous. It's known that they hire, you know, only the top of the top talent. So when those people leave and start their own thing, you can like odds are that it's going to be a good company. And that's what what we've been seeing, you know, with the ex Palunteer employees. >> So So you're not talking about M&A, you're talking more just minority investments like create a venture fund. >> Yeah. Yeah. uh take you know equity positions in uh some of these uh start startups where they know that the person is brilliant and they have some domain expertise because one of the you know benefits of uh having your software you know deployed across so many industries and having so many forward deployed engineers understand the problems that those companies are facing is that you kind of become an expert in all of these different kind of industries. So you gain a lot of domain expertise within the company uh with with all of these FD. So I think that and you know uh it's not common knowledge but corp actually used to run a hedge fund a really successful hedge fund and we we also know how successful of an investor Peter Teal is. So it kind of makes a lot of sense that they would have some sort of venture arm tied to them. Uh I think they have a real good advantage to make some good investments. But you know first and foremost you know take equity stakes in companies that share your values and that you're also collaborating a lot with like Andrew like in the government context and the war context they have a lot of joint uh missions like uh Titan for example which is u yeah we don't have to go into the details but that that kind of companies is what I would like to see them use their cash for if they can't you know burn cash to grow faster which they don't that doesn't seem to be an issue for know. >> Yeah. Titan's the the truck command or whatever with Yeah, like the uh command and control like truck. Uh >> Got you. Got you. Um one of the things that I've struggled with on Palunteer is, and not struggled, I I mean I'm looking at it like alpha, but I look at Wall Street estimates and they essentially are looking and saying Q1 was peak growth. like like we topped out at 84% next quarter it's going to be 80% and you know all the way down back to essentially 30% year-over-year. >> On the other hand, you have Alex Karp saying that they're going to grow by 100%. So there's a big difference between what Wall Street is saying, what Alex Karp is saying, but then also whenever I look at, you know, previous previous um quarters, Palanteer has destroyed Wall Street estimates. So I have no reason to believe that they're accurate in these numbers as well. How do you because you're you're you're very good at forecasting and you know you you you do a lot of the fundamental analysis. How are you forecasting Palanteer's growth and what makes you believe that the fair value which if I I don't know if I could say it but your recent article I think said the fair value for Palanteer was $347. >> Yeah. Yeah. Yeah. Of course you can use it. Um so Wall Street in general I I can't I can't show the model got you but but we can talk about it. So, Wall Street has been perpetually wrong on Palunteer ever since they went public and you know famously even after Palanteer was you know soaring into the hundreds you had you know half the the Wall Street analysts still like giving out you know $20 price targets you know it was completely insane. Um even uh a funny story, one of the analysts that covered them since DPO was replaced because I assume like we can only speculate, right? I assume the the banking clients were like, "Uh, you told us to short this. You have a $18 price target. The the stock is at 180. This is unacceptable, you know?" So, they fired that guy or replaced him with a new one because he's still like on the coverage, but he's not like the main coverage. and then they place you know a new 100 plus price target you know after just replacing him. So you know Wall Street has been wrong uh and they are still wrong I believe and yeah you're right in believing that there you know no credibility to their forecasting and I'm not saying that I know either because each passing quarter like intrinsic value increases by so much because this is the kind of company where uh for those that don't know you know your intrinsic value for a company is a reflection of your understanding of the company because you're forecasting out you know 5 10 years and bringing it back to present value. So the more you know about the company the more accurate your forecasting will be. With Palunteer you learn so much every passing quarter that like you can just throw your previous forecasting into the garbage bin every you know quarterly results. uh because you know for example in Q1 now as you mentioned corp said yeah we're going to grow um the US side of the business which is you know 80%ish of the business we're going to grow it 100% this year and next year we're going to grow it another 100%. You're like, "What? Wait." And then then you start to try to make sense of it in your forecast like, "Oh my god, how are we going to reach this?" And then you also factor in that, you know, they are continuously improving margins. You know, they have insane operating leverage. Uh because they're not hiring people. They're they're doing this off the same, you know, uh employee base with no, you know, input costs. And then you start to get some really crazy numbers. So $240 to you that might sound completely insane. I mean Palanteer is already uh let me check it's trading at 666 price to sales and 1550 PE. >> That price to sales was you know close to 200 just a few quarters ago. This company is just growing so massively. So >> is 66 price to sales is that really an expensive multiple for a company that's going to grow 100% this year 100% next year? And when you look at, you know, the backlog, you know, the remaining performance obligations that, you know, keep >> Can I clarify? >> Sorry, you you squeeze something in there that uh I just want to clarify really quickly. They're going to grow 100% this year and then 100% on top of next year. >> Yeah. >> So, they're they're 4xing revenue. >> Yeah. >> Wow. Okay. >> Yeah. But but that's nothing that that that was Q1. That that's old news. What what Karp said uh in a recent CNBC interview is that uh they're going to be doing 15 to 18 billion dollars of free cash flow. >> And what what what that means in two years is you know more than a 4x in revenue they will have to grow a hell of a lot more than that. So when you start to plug in those numbers and try to reach that you get an even crazier number. I see Wall Street I was looking at Wall Street's estimates because he said I I brought up the quote really recently and I could play it again here but he essentially said it's really easy if you look at our numbers um we're going to do or if you look at our financials we're going to do roughly 15 to 18 billion of free cash flow uh in the next two years. >> Did he mean cumulatively or annually? Because the Wall Street estimates are almost around 16 billion cumulatively. How do we know that he's not saying like because that's an insane amount of growth. Like essentially what he's calling for for free cash flow is what Wall Street's calling for for revenue. >> Yeah. Uh no, it's not cumulatively because if it was cumulatively then the revenue numbers wouldn't make sense that he said in in Q1. So he means that in the period. >> Got you. And where where >> where did you see the number that he's going to grow from 100% and then 100% on top of that the next year? >> It was in the Q1 earnings call. >> Okay. >> I believe wait let let me let me pull it up. I have it >> because this thing for me. So the the exact quote is from Q1 2026 we are at our limit to doing 100% this year which which I'm going to drive the company to do and then maybe we can do 100% next year in the US is what he said. And remember US is already 80% of the revenue. If they grow that 100% this year then it's going to be uh even higher weight. >> Yeah. Like 120% >> 100%. Yeah. Yeah. >> Yeah. That's crazy. So he's talking full year 2026 then full year 2027. >> Yeah. And then I'm assuming that the free cash flow target is for 2028 because by uh 2027 you know uh one and a half period it would be like >> it would be in wild. >> Yeah. So if you try to derive what kind of revenue you're looking at you can share this chart. It would mean that they would go from something like 4.47 47 4.5 billion in 2025 to 27.5 billion like if you apply the kind of margin profile that uh we are currently seeing uh today. So they would be doing close to 30 billion in just you know uh two and a half years essentially which is you know >> but even even the margin like just looking uh or going off memory net income margin went up like 10% quarter over uh so what what he's likely talking about is uh adjusted free cash flow which you know when when when people say adjusted they're like oh you tie in a bunch of no adjusted for Palanteer are some uh payroll taxes associated with SPC like 80 tiny it's like 10 million or less like it's it's tiny so when they say adjusted it's essentially you know normal free cash flow so they're already doing like 56 57 uh you know if we do annually they did 51% here >> in um 20 2025 so if you like okay they might grow margins you know, over the next two years. But if you have some reasonable margin assumptions, essentially what you're looking at is still, you know, 27.5 billion in revenue to reach that, you know, 15 and and that's on the low end. That's the 15 billion. I didn't even calculate the 18 bill like the the upper end. Yeah. It's it's all it's already in insane enough uh looking at just that. So, yeah. >> Yeah. some I I find I do the same thing sometime where I'm like, "Okay, let's just keep it conservative because that alone should sell you." >> Yeah, >> we don't even have to just know that there could be even more than this based on what Karp said. It's it's wild. Uh 27 billion. And then what does that make their forward price to sales like uh what 14 times something? 13 times. >> Yeah, I don't know what the current market cap is. Uh I can check. >> 320 something like that. 342. >> Yeah. Yeah. Well, what whatever it's not an expensive multiple considering the kind of growth that you're seeing like the market will gobble that that up like >> and and the margin, right? You can't you can't put two different companies and compare their price of sales whenever one has a 20%, you know, free cash flow margin, the other one has a 57% margin, >> right? So, so you have really two common approaches here. One is that you price the company, right? you look at price to sales and you look at the price of earnings and then you have the intrinsic value approach where you try to forecast you know company results over the next five five to 10 years for a long while uh okay no I'm I'm lying for for for a bit now for a quarter or two Palunteer has actually started to become undervalued but you you have to remember the company moves so much every single quarter because two quarters ago I would I told you now Palanteer is probably overvalued here or you know >> close to fairly valued but then you you hear these like statements and then you're like well >> how how credible are these statements and then you go back to the as I mentioned like earlier in the story uh when he told the Wall Street analyst no we're going to do 4.5 billion uh even though we removed the 30% keer we're still going to hit it like that's what he said and then when no one believed it when they grew 12.5% % like yeah how are you going to grow 30% keer like you're dropping off fast uh and then he still did it so it gives some credibility to what Karp is saying and historically whenever he's made these kind of statements and he's really uh careful about it because every earnings call they have like a a lawyer team on standby like uh you can't say that you can't say that like he's really peculiar about what kind of statements he puts out there so when he's saying that I think that there's some credibility to him actually uh hitting these goals. >> Yeah. I mean, they must see some sort of pipeline based on customer demand. That's another one. Um retention rates have been some of the highest I've ever seen while being an investor, 150%. Now, is there any possibility that this continues to climb higher? >> Yeah. So that's what the the chart we we looked at earlier with the cohort uh chart like existing versus so that's only the net dollar retention rate but you you know you separated so you see how how much of the growth is existing customers how much is the new and as you can see uh the the general you know net retention it's it's not even caught up to the top 20 customers like the those are the ones driving the growth and we can see like they don't report it anymore but they used to report actual cohorts like okay the 2018 cohort how are they growing 2019 and you can see that it it takes a while as you on board them you actually lose money because you've done demos you've done you know implementations you you've sent out engineers so initially you lose money but each passing period like you start to earn so much more from each different client like the whole land and expense strategy is what it's called. So, as they start scaling customers, I don't see this slowing down anytime soon. And that's not only from the net retention rate. Uh we we didn't even look at it. Uh I'm I'm going to share another chart which you know gives credibility to the whole scalability of the business here and why I don't believe revenue growth is about to slow down anytime soon. If if we look over at contract balances for example, look at what RPO did here in uh the the quarters like it jumped massively. Of course, um Q1 is typically the weakest one. >> Oh, really? You typically book you know towards the end of the year. Uh which why you you know you see this huge increase here. Uh but still like they are growing RPO massively and if you look RPO is only essentially only the commercial side of the business because this is guaranteed revenue and you can only guarantee it on the commercial side because the the government side of the business has like variable contracts with different lengths and you know op options and stuff like that. But if you look at remaining deal value which also includes uh the government side of the business uh it is you know approaching 12 billion and it's growing you know close to triple digits year-over-year still and it's like moving exponentially. Of course, Q1 is a bit, you know, weaker. Uh but but still like the contract balances for this business, like this shows you that, oh, I mean, they're not even starting to recognize their potential here. And it's only accelerating how much they're getting. And if you look specifically at US commercial uh you have been at triple digits you know for over a year like five quarters since Q1 of 2025 it's grown at triple digits you know uh for US commercial specifically so I mean um one last chart um the total contract value which is you know how much contract value they they book each uh quarter you can see here that It's also been trending up and as I mentioned you know Q4s are really strong that's when you sign uh the majority of the of the contracts but the trend here you know it's really like when you go out on a year and and not quarterly you see like the this business is not you know no metric that you can look at is showing signs of slowing down and essentially when you look at the whole nature of how they're getting their revenue growth going back to the net dollar retention it uh here uh now it glitched out but yeah it's 50% uh just from existing customers and it's been increasing every single period and the reason it does that is that AIP is u consumption based so the way Palanteer used to sell software maybe I can even pull up the net retention rate it's be easier uh yeah here so um the they used to sell software is that it was bulky like it was expensive and you had to pay like everything like you you had to take on a huge cost and you didn't really know like uh what kind of ROI are we going to get on this. So that's why you know growth was kind of difficult in the earlier period. So that's why even though this company has been around for 20 plus years it's still like a relatively young company early stage company like in the grand scheme of things because it hasn't been maturing at all. So the way they sell software now through AIP is that it is you usage based. The more you use the the software uh the more you will be built. So the same model as you know LLMs you know with token costs. >> Sure. essentially. >> So what companies do now is that they employ deploy Palunteer to solve like one use case like okay we're seeing uh that this really works for us then you deploy it to two three and before you know it it is you know you have Palunteer across your whole enterprise and we had a really good report last year that showed us that some customers uh from the point that they became Palunteer customers within a year they increased you know the the spending by four to 5x just by deploying more AIP across more and more use cases so the more value you get from Palanteer the more you want to use it and the more you use it the more value you get so that's like this uh uh >> but they don't but they don't count the net dollar retention in the first year correct >> yeah so you have to have been with Palanteer for more than 12 months >> so this even more bullish that they take out the first year because that's where the you know really explosive growth comes in where customers are trying to find out where >> Yeah. Right. So you have the biggest kind of growth uh you know within the first year as you're expanding. So this is like you you've already had Palunteer for over a year. >> Yeah. >> 150% on the the matured growth already. >> Yeah. Right. Well it's it's not mature but Yeah. Yeah. So, uh, as I mentioned, um, if we look here at >> I completely fresh. >> I don't know. I don't know if this, uh, shows it. No, it doesn't show it. Let me just check quickly here. Uh, give me one second. So, what what I want to look at is the top 20 customers. Uh, let me see where do I have that here. So, they did uh, let me see. Oh, 108 million. Oh, you don't have to show the Excel. I'm just looking. 108 million on a trailing 12-month basis for the top 20. Uh, and the average across the business is now something like 3 million. Uh, so I'm going to show you that now. Average revenue per customer. So this excludes the top 20 you know so you can get a you know it it excludes you know half the business which is only 2% of customers. So this gives you a a fairer view. It's up to 3.1 million now. Uh and the top 20 are doing over a 100. So it really goes to show you like how tiny these are on average and how much potential there is for growth among you know the average customer out there. like they are still relatively tiny you know 3 million per year h compared to some other software spending that you're seeing you know at different SAS businesses 3 million is not that bad so as this starts scaling up you know I mean growth is going to continue be very very high for a very long period of time to come and as you mentioned the magic isn't just revenue growth because any company can grow revenues by burning a lot of cash you know they could do M&A deals for example they could you know uh give discounts what whatever like you can grow by burning a lot of cash but the thing about Palanteer is that they are growing uh not the rule of 40 what I want to show you is as you mentioned the um operating margins and uh income margins they are actively growing margins every single period because uh their costs this this is not the best chart it's a confusing but as you can see R&D as a percent of revenue GNA as a percent of revenue sales and marketing as a percent of revenue it's going down drastically because they are essentially flat so I think I have that chart here give me a second uh essentially it's flat I should have prepared it ah here so here we have or or R&D expenses as as you can see since like Q1 of 2019 more or less flat like they they are not uh spending more money to acquire all of this revenue. So that's why you see this massive margin expansion and essentially if you ask me what's the what's the ceiling like essentially there are like 50% plus operating margins now I wouldn't be surprised if they start to reach you know uh very close to those gross margins you know 80 plus you know if they 80% because >> I mean the the the operating leverage is just insane at this company. >> Yeah. Yeah. So when you combine those two, you know, uh explosive revenue growth with explosive margin expansion and then you start to forecast, okay, what does this look like 10 years out? And then you try to derive fair value. So that's why, you know, people always think I'm so crazy when I'm like, no, no, Palanteer is undervalued here. Like it's worth, as I mentioned, um currently it's at $340, you know, more than a double from where it's trading. And people are like, "No, no, you are insane. It's at 1550 PE." I'm like, "Well, start to extrapolate some of the things that we're seeing and maybe you won't think that I'm so crazy anymore, you know?" So, >> yeah. Like it it's funny like whenever the stock was at $200 in growth was half the growth rate that we are today, I didn't like it. Um, now today we we ended up going from $27 down well not not today but a little bit earlier and down to like $110 and growth has doubled in its rate like and expected to continue to climb. It's like this is a completely different valuation. >> Yeah. >> It's not just half the cost. It's twice the growth rate. It's it's higher margins. This is the the the the riskreward just completely tilted. >> Yeah. And and to to put things into perspective, they did more in free cash flow uh of Q1 2026 than they did in revenue a year prior. So this just goes show you like how quickly things are changing for this company to the upside. So it's pretty Yeah, >> dude. I uh really appreciate you giving me this uh this breakdown and the rest of the audience as well. Is there anything else that we potentially didn't touch on that you want to clarif clarify before you go? >> I mean, uh, it's a very, you know, deep company, so there's a bunch of stuff, you know, this is just, you know, scr scratching the the surface, but I I I really urge >> people who hear about Palunteer to to look into some some of the claims. So obviously the rap they get in the media is not positive. Um I I understand some of it like uh I I don't comment on geopolitics or stuff like that but people are boycotting this company you know calling them you know that they are performing genocide uh for example. You have to remember uh in every conflict that Palanteer is involved, you should be rooting for whoever is using Palanteer to continue using Palanteer because the targeting is so much more precise while you're using Palanteer. It greatly greatly reduces uh the loss of civilian lives. So if we take Palestine for example, it's you know horrible to see what's happening on both sides of course but for for people that are saying oh uh Israel is performing genocide with Palanteer. Now let me tell you without Palanteer civilian lives that have been lost would have you know been exponentially higher because the targeting that you you get from Palunteer is you know so much more pre precise when when you're choosing you know targets and and and stuff like that. So try to look into things about Palanteer. For example, um they are also called you know uh a spy company that they are spying on citizens like Palunteer doesn't have any data about you like they they sell the software and the data is rigorously locked with extensive audits for any data pool. Like everyone knows exactly who did what with Palunteer. So trust me like they they are not spying on you. So >> when you read these things uh in in the media you should look into them you you yourself and build your own you know opinion about it. So that's like the one thing we didn't touch on and I don't like touching I I want to discuss you know the company's performance financials where the company's going. Uh but that's one you know ugly side of the business that is really misunderstood I think. Last question uh that I would have and I've seen some comments go by while we've been talking is also um you know SAS has been taking a hit on whether or not Enthropic or some of these other models might be able to replace what these software companies do. Why is Palanteer immune to this or you know could they be subject to the same sort of scrutiny? um it's irresponsible to say that they can't because things in the AI world are moving so quickly. >> Sure. >> So there there is always the theoretical possibility, but there are some signs that tell me that it won't happen anytime soon at least. One is that uh for example uh we've been seeing for example with the Figma entropic stuff. Are you familiar with it? >> Yeah. How they partnered with them and now we're starting to work without them? >> Yeah. Yeah. So there's one thing about you know IP theft and concerns about that and that's actually a lot broader than than I initially thought. So I've been like we've been hearing a lot of seuite executives raising concerns about that. So there's the the IP theft part about partnering directly with you know these AI labs. Uh the second one is that for example we saw Kim K3 come out ju just now you know started to top charts >> and we've been seeing this like kind of yo-yoing of which LLM lab AI lab is the top dog you know it was Gemini then it was claw then it was open AI and it moves back and forward and why would you choose to lock yourself in with one specific AI lab when you don't know if they're going to be the best one ne next month, let alone in a year's time. So the thing about Palanteer is that they are um model agnostic. You can use any model you want uh open source or not, which you know with the new Nvidia model for example and the Palunteer partnership there, but you can plug and play any model you want and you're only using it to build essentially. So, um, one, the IP theft part, two, the vendor lockin doesn't really make sense with with what we're seeing, and three, uh, everything that Entropic is doing is apparently by using Palanteer themselves. Uh, if we're to believe Alex Karp when he asked like, "Do you have beef with Darius?" He he said like, uh, I think this was also on the CNBC interview recently. He said um I'm I'm paraphrasing but he said essentially what you're seeing Antropic do they're doing it using Palanteer and like no I'm not worried about them like when they asked him that question. So there there are a few variables against you know Palanteer being replaced by AI. Could it happen? Yeah. Yeah. Of course. I mean AI capabilities are becoming very strong very quickly. So we'll see. >> Amir, thank you so much man. really do appreciate you jumping on the show. Uh for anyone looking for me, he also has a X, but obviously I see on screen you're also promoting your your website here. So I'll throw that on screen. It's also in the YouTube chat. >> Substack. Yeah, >> the Substack. And um I'll throw your X up here as well. But uh brother, thank you so much for uh for joining and hopefully we do this again soon. >> Anytime, man. Just reach out and thank you for having me on. >> Yeah. Yeah, absolutely. All right. See everyone.