Four takeaways from Alex Karp’s triumphant Palantir earnings call

• Alex Karp touted Palantir’s blockbuster earnings in a triumphant investor call.
• He said AI models are commodities — it’s what you do on top of them that counts.
• Meanwhile, other execs at the company have taken some of the focus off his eccentricities, he said.

Palantir’s stock jumped by more than 23% Tuesday following a blockbuster earnings call where CEO Alex Karp said the company had “absolutely eviscerated” the quarter.

Karp attributed Palantir’s better-than-expected performance to a “US-driven AI revolution” but said the company wanted fewer clients.

Karp, a wellness enthusiast known for his blunt manner, acknowledged that Palantir’s success has increasingly overshadowed his own widely known eccentricities.

Here are four key takeaways from Karp’s Monday call with investors:

1. Other Palantir execs have helped shift the focus away from Karp.

Karp acknowledged he may be seen as eccentric but credited other executives at the company — namely Chief Technology Officer Shyam Sankar and Palantir USG President Akash Jain — for helping other companies come to view Palantir as an ally.

Initially, Palantir was seen as winning “too much” and making “all this money,” Karp said.

But opening up parts of its product and enabling other defense tech startups and larger companies to safely access government data has changed industry perceptions, he said.

Rather than viewing him as a “batshit crazy,” Karp said, other companies are more eager to collaborate.

“They’re not hating the player. They’re playing with us,” he said. Karp said having Sankar and Jain aboard was key to this transition.

2. AI models are commodities — it’s what you do on top that counts.

Karp said some industry players are missing the mark on the actual value of nascent AI technology.

Karp likened large language models, or LLMs, to commodities, saying the valuable asset is “how you manage the commodity.”

Chief Revenue Officer Ryan Taylor echoed this point, saying that while much of the investment in the AI industry has focused on improving LLMs, Palantir is focused on leveraging AI that capitalizes “upon the rich context within the enterprise.”

To this end, Palantir’s Artificial Intelligence Platform allows companies to build their own AI apps. For instance, Taylor said at a leading insurance company, the platform slashed underwriting response times from two weeks to three hours by creating 78 AI insurance agents.

3. Palantir wants fewer clients.

Palantir execs were surprised by the company’s quarterly earnings.

“Even we are shocked by the 44% growth in the US off of a $2 billion base,” Karp said.

But looking ahead, he said the company would prefer fewer clients to focus more deeply on product development.

Karp said he’d prefer to cultivate a smaller number of “individual titans that are dominating their industry or the battlefield” rather than 10,000 clients who hate you but can’t get rid of your product.

4. Palantir wants to give American warfighters “the unfair advantage they deserve.”

Karp and other execs discussed the world’s current, war-torn landscape — with what he called “brutal, heinous, immoral, and often terroristic enemies.”

Palantir can help reduce forces by magnitudes on the battlefield, Karp said.

Sankar said that from Ukraine to the Middle East, the company was “investing aggressively to expand the perimeter to give our warfighters the unfair advantage they deserve.”

Sankar specifically called out Project Maven, which trains AI to analyze drone footage to identify people and objects and which was adopted by the US Army last quarter.

Maven can drastically reduce the number of people involved in a targeting and firing operation from 2,000 to 20, he said.

“There are whole global events now that would be very different without our ability to manage these things in our infrastructure,” Karp said. “And that’s obviously generating a lot of excitement internally that spills into our earnings.”