Palantir's Alliance Spree Runs Into a Valuation Wall

Palantir's US commercial revenue rose 149% to $764M in Q2 2026, with total revenue up 93%. UBS raised its price target to $250 on September 15.

Palantir has spent years cultivating a reputation as the sober counterpart to Silicon Valley's model-builders — the company that turns unruly algorithms into software that regulated enterprises and government agencies can actually deploy. That positioning is now paying off in the commercial arena, even as the stock's price tag leaves little margin for error.

The clearest evidence of the strategy's traction came during the second quarter of 2026. US commercial revenue surged 149% to $764 million, while total revenue climbed 93% to roughly $1.94 billion. Operating profit, meanwhile, vaulted from $269 million to $912 million. The figures make plain that corporate clients are no longer dabbling with pilots; they are wiring Palantir's platforms into core operations.

A Network Built Around the Industrial Nerve Centers

Palantir has been widening its partnership web on multiple fronts. Alongside a deepened collaboration with Nvidia spanning supply chains and cybersecurity, the company announced a renewed agreement with Fujitsu covering international manufacturing. Deals with Method Security and Nebius round out the push.

The Nebius arrangement, struck on September 8, designates the group as Palantir's preferred partner for sovereign AI infrastructure. Under the terms, Nebius compute and inference capacity will be embedded inside Palantir's enterprise boundaries for commercial customers. Two days later, on September 10, the AIPCon11 customer conference put those capabilities on display in live operational settings.

The logic behind the tie-ups is straightforward. Feeding data into vast data centers and hoping for brilliant output no longer cuts it. Large corporations want data sovereignty, hard access boundaries, and legal certainty — and Palantir is selling itself as the bridge between unpredictable models and tightly regulated corporate structures.

Karp Takes Aim at the Model Labs

Alex Karp has been unusually blunt about where he thinks the industry's incentives lie. Speaking to CNBC on September 17, the Palantir chief accused leading developers such as Anthropic of weaponizing the AI-safety debate to invite nationalization and dodge looming liability claims. His counter-proposal: nationalize the AI labs outright and hold irresponsible developers accountable in both civil and criminal court.

The company has also curtailed internal use of external language models amid unresolved questions over data retention — a reminder of how unsettled the regulatory landscape remains. Karp's intervention lays bare the rift between pure model researchers in Silicon Valley and the players who embed software into real corporate workflows and government networks.

UBS Raises Its Target as the Stock Sits Below Its Peak

Market watchers have greeted the mix of combative rhetoric and concrete implementation with approval. On September 15, UBS analyst Karl Keirstead lifted his price target on Palantir from $220 to $250, reaffirming a buy rating in the wake of AIPCon11. For the analysts, the ideological sparring matters far less than the ability to convert new models into recurring software revenue.

The shares were quoted at EUR 155.16, up 0.4% on the day, though still about 14% below their 52-week high. European trading had closed the prior Friday at EUR 154.58, against a 52-week peak of EUR 179.98.

Growth Is Real — So Is the Price

The operational story is hard to fault: steep expansion, widening margins, and blue-chip industrial partners. Palantir sits at the intersection of data centers, manufacturing, and cybersecurity, a strategic spot few peers can match.

Yet the valuation already discounts an enormous amount of future growth. Even bullish scenarios rest on the assumption that free cash flow climbs sharply through the end of the decade. On the current multiple of forward annual revenue, any wobble in US growth or delay in new bookings could trigger painful pullbacks. UBS's $250 target implies meaningful upside, but the air is getting thinner.

For those already holding the stock, the intact operational momentum argues for staying put. Newcomers may find better odds waiting for a broad market consolidation before committing fresh capital.