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QS Research · Michael Burry's Scion Capital analyst template · 2006

Palantir Technologies Inc. (PLTR)

As of 2026-11-02 · 12/15 boxes filled from SEC filings and market data

Conclusion: SHORT

Conviction high · base case -72% · downside -92% · upside -36%

Palantir is a genuinely high-quality, net-cash, hyper-growth software company, but at $184.03 the market is paying 75.3x TTM sales, 156.7x TTM earnings and a 0.7% FCF yield. Even assigning the highest peer multiple, Snowflake's 19.56x EV/Sales, to TTM revenue of $6.16B yields only $50.57/share; applying an extreme 100x P/E to TTM net income of $3.02B yields only $117.59, still 36% below today's price. The insider tape is uniformly bearish: no insider buys in two years, over $1.0B sold by Karp, Thiel, Cohen and Sankar, with Cohen nearly completely out. Section 13's TTM base is the right one and we use it for all cases. Short, high conviction because base, downside and upside cases all sit far below the current quote.

Key numbers

The 15 boxes

  1. ✓ 1. Long-form business notes

    Palantir sells four software platforms—Gotham, Foundry, Apollo, and AIP—to large government and commercial institutions; FY2025 revenue was $4.48B, split 54% government / 46% commercial. Customer count rose from 139 at end-2020 to 954 at end-2025, with top-20 trailing revenue up from $64.6M to $93.9M in the latest year. FY2025 operating income was $1.41B versus an FY2020 operating loss of $1.17B, reflecting scale and the 2023 launch of AIP.

  2. ✓ 2. Competitive advantage

    Palantir competes primarily with customers' internal software development and large enterprise/government contractors; the filings cite no explicit durable moat beyond product capabilities, security, and brand. Customer relationships show some stickiness—top three customers averaging ten years and representing 16% of FY2025 revenue—but contracts are often terminable for convenience. Financials improved sharply: revenue FY2025 $4.48B, operating income $1.41B, net income $1.63B, versus losses as recently as FY2022. No source establishes a defensible, durable competitive advantage.

  3. ✓ 3. 10-Q takeaways

    In Q2 2026 PLTR revenue rose 93% YoY to $1.94B, with commercial up 110% and government up 79%. GAAP gross margin widened to 85% and contribution margin to 74%; adjusted operating margin hit 62%. Liquidity was $9.2B in cash/UST at June 30, 2026 with H1 operating cash flow of $2.12B. Guidance is qualitative: U.S. growth expected to continue and opex to rise; new risk factors flag revenue sustainability, customer concentration, and contract termination.

  4. ✓ 4. Corporate governance
  5. ✓ 5. Overview of the prior 3 years of 8-K filings
  6. ✓ 6. Other significant filings
  7. ✓ 7. Chronology of significant news and events
  8. ✓ 8. Comparables valuation interpretation
  9. ✓ 9. Insider trading interpretation
  10. ○ 10. Earnings-call notes
  11. ○ 11. Impression of the shareholder letter
  12. ○ 12. Scuttlebutt overview
  13. ✓ 13. Valuation and risk/reward summary
  14. ✓ 14. Current price suppression and potential catalysts

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