Palantir Technologies is set to release its second-quarter 2026 earnings report on Aug. 3. Here’s Morningstar’s take on what to look for in Palantir’s earnings and the outlook for its stock.
Key Morningstar Metrics for Palantir Technologies
- : USD 153.00Fair Value Estimate
- : ★★★Morningstar Rating
- : NarrowMorningstar Economic Moat Rating
- : Very HighMorningstar Uncertainty Rating
Palantir Technologies Earnings Release Date
- Monday, Aug. 3, after the close of trading
What to Watch for in Palantir Technologies’ Q2 Earnings
- Palantir’s LLM: We’re watching whether frontier model providers can replicate Palantir’s ontology. Right now, we see a meaningful delta between Palantir’s ontology and frontier model incentives. Palantir needs to deliver outcomes, while frontier model companies are incentivized to “burn” tokens. As it stands with the frontier providers, positive enterprise outcomes are good for business, but less essential than it is for Palantir, the governed operating layer of the enterprise.
- Competition: We do not think model companies are capable of reproducing the persistent, governed representation of the enterprise (like Palantir is). This could change in the years to come, and it is the key tension on valuation. Should there be a convergence in model capabilities (commodification) or a proliferation of open-source models from China, we like that Palantir can support and route workloads across various model providers.
- International growth: Palantir management has been verbose in their explanations of why European adoption has been slow, but they mostly cite philosophical differences, bureaucratic red tape, etc. Overall, Palantir is growing so fast in the United States that they don’t necessarily need Europe, but European growth would be a massive accelerant to the upside and make the valuation math work a lot better.
- Stock price: Upside momentum and speculation have cooled since the stock peaked at around USD 200 per share in the fourth quarter of 2025, and Palantir has been in the USD 115-USD 150 range for most of 2026. This may sound like a wide range for most stocks, but for Palantir, it reads more like logical price consolidation for a company that is growing rapidly and expanding margins, yet continues to battle bearish narratives about the massive multiple it commands. When buying Palantir at USD 150 (Morningstar’s fair value estimate), you need a lot to go right, but we believe that is the most probable outcome, sans some massive frontier lab threat.
The following are excerpts from Morningstar’s company report on Palantir.
Fair Value Estimate for Palantir Technologies
With its 3-star rating, we believe Palantir’s stock is fairly valued compared with our long-term fair value estimate of USD 153, implying a 2026 enterprise value/sales multiple of 48 times. In our opinion, the primary driver of the stock’s value is the total addressable market Palantir’s software can ultimately serve. Our base case has Palantir’s TAM growing to USD 1.4 trillion by 2033. We forecast an average annual growth of 52% between 2026 and 2028. Our analysis concludes that we are in the early innings of an AI revolution. We expect Palantir to similarly drive efficiency among enterprises that now rely on large information technology teams to interpret and present data to support decision-making. We project gross margins to remain in the 83%-85% range over the next 10 years as we balance the onboarding of higher-margin enterprise customers with the potential for cloud costs to rise amid ever-increasing demand for computing resources.
Read more about Palantir Technologies’ fair value estimate.
Economic Moat Rating
We believe Palantir warrants a narrow moat rating, based on switching costs and intangible assets. Palantir differentiates itself as the only AI company with a framework that organizes disparate datasets and facilitates optimized decision-making. This machine-learning framework, which identifies opaque yet significant relationships in data and creates solutions for the end user, is referred to as the “ontology framework.” Palantir engineers a read-write feedback loop that enables connectivity throughout a business, creating an accessible analytical framework to drive nuanced decision-making that improves over time.
Read more about Palantir Technologies’ economic moat.
Financial Strength
We view Palantir’s financial position as healthy and improving. As of March 2026, Palantir had approximately USD 2.2 billion in cash and cash equivalents and no debt. Palantir now has three full years of GAAP profitability under its belt, with 2025 more than three times as profitable as 2024. We expect rapid growth and profitability to continue.
In the past, Palantir has had dilution concerns revolving around high stock-based compensation, which puts a non-cash drag on profitability, but we do not expect this to be a trend. After Palantir retracted a USD 1 billion share repurchase plan in January 2026 after repurchasing only a fraction of the authorized amount, it’s hard to definitively state that the company viewed the potential repurchase prices as unattractive. But at the very least, it can be concluded that the company is not focused on returning capital to shareholders beyond share price appreciation. Overall, we do not foresee any material changes to the current capital structure, and we expect the company to rapidly increase profitability metrics over time.
Read more about Palantir Technologies’ financial strength.
Risk and Uncertainty
We assign Palantir a Very High Uncertainty Rating. The company’s biggest uncertainty concerns the broad potential size of the total addressable market its software can serve and the level of customer penetration it can achieve. Unfortunately, because the TAM estimate is so uncertain and is one of the largest drivers of the stock’s valuation, downward price corrections can be severe and painful. If our bear case on TAM occurs or a viable alternative emerges, the shares will likely prove worth far less than we expect.
Read more about Palantir Technologies’ risk and uncertainty.
PLTR Bulls Say
- Palantir has developed the premier AI software and is well-positioned to capitalize on trends toward digitization, automation, and reindustrialization. We believe the firm’s software maintains a strategic position in the AI value chain as a model orchestrator.
- Palantir’s ontological framework and AI orchestration allow for the democratization of machine learning. Its software is useful to employees at all levels of a business to drive efficiency enhancements.
- Palantir stands to disproportionately benefit from a Golden-Dome-led fiscal spending boom and lacks a clear competitor.
PLTR Bears Say
- Palantir’s end markets are confined to entities that coalesce with Western ethos. This caps the total addressable market.
- The declining cost of AI inference and improvements in agentic LLMs will lower barriers to entry in the AI decision-making software industry, which Palantir currently dominates. Anthropic and OpenAI could become viable competitors.
- Palantir’s high valuation multiple leaves no margin for error in terms of execution. Any fears on the maintainability of growth will be met with sharp selloffs.
This article was compiled by Irza Waraich.
