Palantir's US Momentum Collides With European Headwinds

Palantir shares sit 5.4% below their 52-week high after a 60% Q3 rally, but European regulators and health-data objections mount.

Palantir Technologies finds itself telling two very different stories to two very different audiences. At home, the data-analytics firm is riding a commercial boom that few software companies can match. Abroad, it is fighting a rearguard action against regulators, civil-society groups, and governments that increasingly view its technology with suspicion.

The stock, for now, reflects the optimistic version. Shares changed hands at EUR 170.22, leaving them just 5.4% shy of their 52-week high of EUR 179.98. That follows a roughly 60% run-up over the course of the third quarter, a rally that has been powered almost entirely by the company's US business.

A Domestic Growth Engine Running Hot

The numbers behind that rally are striking. In the second quarter of 2026, Palantir's commercial revenue in the United States surged 149% year over year to USD 764 million. Total revenue for the same period climbed 93% to USD 1.94 billion. Management has guided full-year 2026 group revenue to between USD 8.15 billion and USD 8.16 billion.

Such explosive expansion does not come cheap in valuation terms. The stock trades at a price-to-earnings ratio above 100 based on forward earnings, a multiple that already bakes in years of anticipated success. Cathie Wood's ARK Invest took advantage of the elevated price on Tuesday, offloading 20,805 Palantir shares worth just under USD 4 million.

A Partnership Built on Physical Control

Palantir's latest strategic move offers a window into how it intends to defend its franchise. On Tuesday the company unveiled an alliance with Armada, a tie-up that sent the shares up 2.3% to EUR 169.12 on the day. Armada becomes Palantir's first certified partner for modular data centers.

The pitch is straightforward: corporations and government agencies should be able to run open-source AI models on infrastructure they fully control. The mobile units are manufactured in the United States and allied nations, a deliberate choice aimed at severing technological dependencies on foreign suppliers.

The logic reflects a broader shift in how modern IT architecture is perceived. Standardized cloud offerings run into their limits wherever military secrecy, industrial core competencies, or national security interests are at stake. Can a technology truly be called sovereign, the argument runs, if physical control over the executing systems rests in foreign hands?

Europe Pushes Back

If the US market is rewarding Palantir, Europe is increasingly making its skepticism felt. France has replaced the company at its domestic intelligence service. The German military has suspended new contract awards for the time being. Swiss federal authorities recently declined the software as well.

In the United Kingdom, resistance has taken a legal turn. More than 44,000 citizens filed formal objections demanding that the National Health Service in England halt processing their personal health data through Palantir's platform, as reported by The Guardian. The health authority said it would respond to the challenges within the framework of applicable data protection laws.

CEO Alex Karp has responded to the regulatory climate with characteristic bluntness, warning Washington against adopting the European Union's approach to artificial intelligence and describing it as a template for what does not work. He also advocated for open AI models, arguing they are optimal for many customers and can sometimes outperform top commercial offerings.

Small Contracts, Steady Revenue

Beyond the headline-grabbing deals, Palantir continues to accumulate the kind of bread-and-butter government work that underpins its business. On Wednesday the US Department of Agriculture awarded a delivery order for the financial audit tool Contracts 360. The immediately committed amount stands at USD 856,668.56, with the potential contract volume reaching as high as USD 1,713,337.12.

Wall Street Split Ahead of Earnings

Analysts remain divided as the company prepares to report third-quarter results in early November. Goldman Sachs carries a neutral rating with a price target of USD 204. Rosenblatt Securities is considerably more bullish, maintaining a buy recommendation and a USD 225 target.

The shares were up 0.7% in Wednesday trading, holding their upward trajectory despite the regional dissonance. Whether the torrid pace of US growth can continue to offset the mounting friction in overseas markets is the question that will shape the stock's next chapter.