Palantir (PLTR) Earnings Preview: 8 Straight Beats, 40% Off Its High, Options Price 12% Swing

Palantir successfully beat analyst EPS expectations for the eighth consecutive time. The most recent example occurred for Q1 2026 on May 4, with an EPS of $0.33 vs $0.27 consensus (22.22% beat). Q1 revenue was an 85% increase year over year, with US commercial revenue and government revenue increasing 133% and 84%, respectively. Despite these numbers, the stock declined 14% after the May earnings release. A sell now, ask questions later behavior was also noted for other companies such as Alphabet, Meta, and Micron this earnings release cycle.

The Q2 consensus bar is meant to be conservative. Forecasted revenues of $1.812 billion are only 0.7% higher than a management guide’s midpoint. Presumably, Palantir is presuming the market expects revenues of $1.81 billion. 

Given that Palantir has posted earnings beats for eight quarters, and the consensus numbers are just above their guidance, it is reasonable to expect them to post an earnings beat. The question is not if Palantir beats $1.81 billion. The question is how much greater than $1.81 billion the revenues are, and how the Q3 guidance impacts the estimate for the full-year revenues, considering the current estimate for the full-year revenues is $3.224 billion.

In terms of Palantir’s government business, one development this week actually provided a positive expectation this Monday. Palantir’s protest for a bid led to the Defense Intelligence Agency’s withdrawal of a solicitation. This allows Palantir the opportunity to bid when the contract is offered again. 

Palantir’s largest business revenue source is from government contracts, and in Q1, sales from the US government grew by 84% year-on-year. Investors will be listening to the call on Monday to understand new defense contracts, AIP (AI Platform) deployments with the US military and the intelligence community, and if the commercial AI Software Platform (which posted 133% year-on-year growth for Q1) is showing an acceleration, as enterprise customers move from the pilot stage to the production stage.

Palantir's valuation has drawn the most contention among elements of the stock. At a price of $123, the P/E ratio is approximately 149 for the trailing earnings and the P/S ratio is approximately 61. Those starkly contrasted ratios speak for themselves. The strongest argument, articulated by Baird's William Power with a price target of $200, is that Palantir is a leading AI growth asset with a temporary pullback, where year-on-year US commercial revenue growth of 133% tells the enterprise AI monetization story and is allegedly of a quality that cannot be found elsewhere. The average price target of the 15 Buy ratings, 4 Hold ratings, and 2 Sell ratings, which represents a total increase of 47% from the price of $123, is $181.24.

The strongest argument against the current valuation says that with a price to sales ratio of 61, even a beat and raise on Monday wouldn't justify the current valuation unless the company plans to change the forward revenue expectations. 

This week, The Motley Fool predicted that the stock would drop over the next week regardless of the Q2 earnings result, since the valuation has completely disconnected from any reasonable estimates from a discounted cash flow valuation. The 12% options implied move represents that both the bull and bear cases are held with high conviction. The post earnings range with a price of $123 would be in a range of $138 on the high side and $108 on the low side. This would cover multiple important technical levels in a single trading session.

In the daily chart, the price of PLTR consolidates within the middle of an apex of a symmetrical triangle. PLTR is currently trading at $123.06. The support of the rising trendline is at $120.41. A descending trendline resistance caps every rally. The 50 EMA is around $126.80, while the 200 EMA is around $130.70, and both act as resistance. An RSI around 45 to 50 is neutral and supports the triangle's indecision. 

Palantir (PLTR) Price Chart - Source: Tradingview

Breakout targets are at $139.09, $145.51, and $151.17. A close below $120.41 opens at $114.66 and $106.60. The options set a 12% implied move from $123, which covers $108 to $138 within one trading session. The entire technical structure is set to resolve Monday evening.

Key Levels

• Q2 Consensus: Revenue is predicted to be $1.812B (81% YoY). Adj EPS $0.34. Webcast at 5:00 PM EDT on August 3rd.
• Current Streak: Palantir has beaten EPS estimates for 8 quarters in a row. In Q1 EPS was $0.33 compared to the estimate of $0.27, representing a beat of 22%. Revenues in Q1 were up 85% YoY.
• US Commercial: Full Year 2026 guidance is above $3.224B. Q1 has a YoY growth of 133%, while Q1 Government was +84%.
• DIA Contract: Defense Intelligence Agency solicitation has been withdrawn due to a post-bid protest, opening opportunities for Palantir.
• Options Implied: 12.12% swing. Larger than 7.39% four-quarter historical average. Expected range is $108 to $138, compared to $123.
• Analyst Target: $181.24 with a consensus (15 Buy, 4 Hold, 2 Sell). Baird set a price target of $200, calling it the ‘premier AI growth asset’.
• Triangle Levels: Downside $120.41, Target $139, $145, $151 if breakout occurs above $131.45.
• Downside opens $114.66 and $106.60 below $120.41.

Why is Palantir down 40% from its high despite eight consecutive earnings beats?

Palantir has fallen from $207.52 in Q4 2025 to $123 despite beating earnings estimates for 8 quarters from 2026 Q1 to 2026 Q3 because of a drop in valuations of SaaS/AI enterprises, high-interest rates, and concerns around the

What is AIP and why is it the key metric on Monday's call?

AIP (Artificial Intelligence Platform) creates opportunities for safe, traceable, and integrated AI applications with proprietary data. It is expected that Q1 2026 will see a 133% increase in US commercial revenue, with the largest detail for the Call on Monday concerning whether customers are evolving from low-value pilots to high-value production. The guidance of 2024 free cash flow from management of $4.2 billion to $4.4 billion indicates such production is indeed occurring.

Palantir is expected to announce earnings on Monday, August 3rd and has reported earnings beats for eight consecutive quarters. Revenue consensus is at $1.812 billion, which is only 0.7% above the mid-point of the estimated guidance by the company. There is a preserved DIA contract opportunity with a 12% options-implied volatility that encompasses the entire technical triangle for one session.

Baird has $200; the average analyst target is $181.24; the stock is at $123. A symmetrical triangle resolves Monday: above $131.45 targets $139 and above; below $120.41 opens $114 and $106. The historic earnings beat and the low bar compared to management guidance are working in favor of a beat on revenue. The fate of the stock is tied to the beat on revenue and guidance for Q3 that will provide a reason for investors to pay a price of 61 times sales.