Palantir's Model Is Not Profitable
$Palantir(PLTR.US$ Palantir's model is simply not that profitable. This is not a traditional SaaS company, since Palantir relies on deploying teams of specialized workers for each particular project. As I've mentioned before, Palantir works in a way like a consulting company, which makes its costs much higher. The high remuneration of their employees, which are essential to the company, is behind the fact that stock-based compensation is so high, and this isn't going to change any time soon.
What's most worrisome though, is that profitability has not improved in the latest quarters. Looking at Palantir's results, it's easy to get swept up by the large increase in profitability from 2020 to 2021. However, if we compare Q1 to Q2, we see a completely different story.
As we can see, Palantir achieved a 34% operating margin in Q1, but only a 30% operating margin in Q2. And in fact, forward guidance from the Q2 slides suggests an operating margin of 22% in Q3.
I believe the company may be deliberately low-balling this figure to deliver a "surprise", much like they have done with revenue. Ultimately, this begs the question; has Palantir's profitability already peaked? And if so, what's the appeal?
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Kaid Osmanagic : Sorry disagree, PLTR is a once in a lifetime Game Changer imo