Palantir stock plunges on earnings, geopolitical uncertainty

Yahoo Finance Live’s Brad Smith discusses Palantir stock amid geopolitical uncertainty.

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BRAD SMITH: Guys, I'm watching shares of data analytics company, Palantir, after their first quarter earnings came out. Their stock is moving lower, by 18% right now. That company facing headwinds from economic and geopolitical forces, but could also see a slight boost from its long-standing US government contracts, Barrons reports.

The government contracts coming into the IPO moment and that liquidity moment for the company, they were already of note. And then you get into the geopolitical situation that we have right now. And that places even more of a headwind on their overall business.

We were taking a look at some of the actuals versus the estimates. The customer count actually grew 86%, year over year. But the loss from operations here, 9% loss from operations, $39 million, ultimately.

- Now, I'm looking at Palantir. I went back and did some quarter over quarter comparisons, which is how a lot of these big tech companies are being judged right now. I look at Palantir's sales in their government business. Now that business grew at 16% in the most recent quarter. It was at a 26% growth rate in the fourth quarter of last year.

So you get another sense of big cap tech company slowing down and seeing slowing growth rates. And they're capturing that in their guidance. Really disappointing sales and operating profit margins from this company.

- I was just looking at the chart for Palantir. This stock, by the way, peaked earlier than many of the other tech companies. Right? A lot of the tech companies we've been watching that have been selling off in the past few months peaked in the third, fourth quarter of last year. Palantir peaked all the way back in January of last year.

And the shares going into today were down 70%. And do you remember the hype around this IPO? It was such an interesting story because there was a lot of controversy around the ethics of this company and its data collection and which governments it does business with and what exactly it does.

And that had nothing to do with the underperformance of the company over the past year. It just hasn't lived up to that incredible hype, the disconnect between its controversies and that it was supposed to be an amazing growth business. And it just has not grown quite as much as the hype would have implied.

- Yeah. I encourage everyone to give it a read. Alex Carp, the CEO of Palantir, wrote a shareholder letter. It was very, I wouldn't say, concerning but downbeat in nature. I would say it's unlike Alex to put forward some of those comments he did in the shareholder letter. But still, just I think, feeds that narrative that we are well beyond the peak in tech.

BRAD SMITH: But this is the same person that also said, when they were going public through that direct listing, that hey, if you don't like how our company operates, don't invest in us.

- Right. Well--

- They're doing that.

- I guess fewer people are investing now, or they're investing at lower prices. Right?