Palantir Technologies predicts that 2023 will be a profitable year

Palantir Technologies, a US firm that specializes in big data analytics, recently published extremely positive news for its shareholders. The company’s new forecast, published Monday, February 13th, predicts that 2023 will be the firm’s first profitable year.

Palantir noted that it did turn to certain measures, such as cutting stock-based payouts, reducing cloud computing investments, and slowing hiring, which allowed it to cut costs. The measures were necessary due to lower spending from recession-wary businesses. On the plus side, the firm’s strategy seemingly worked.

Palantir’s performance drives stock price up

Palantir previously reported better-than-expected Q4 2022 results, which was already great news for shareholders. Now, the positive and profitable prediction brought a lot of excitement, leading the company’s stock to surge by 16% after hours, and was set to add $3 billion to the firm’s market cap, currently at $15.6 billion.

Finance Chief David Glazer commented on the positive performance, stating that the company intends to continue to exercise spending discipline in 2023. It will pace hiring, and it will only invest in high-priority areas, including its own product offerings. At the same time, it will build out its go-to-market strategy and technical roles.

The importance of cost discipline comes as an echo of the thoughts expressed by some of the largest tech giants in the world, including Alphabet Inc and Meta Platforms. These are also the firms that have laid off thousands of employees in the past several months in order to cut the costs and ensure their survival as the market remains extremely uncertain.

Palantir has expressed interest in ChatGPT and similar technologies

Palantir executives have recently also shown enthusiasm and excitement regarding AI, specifically ChatGPT. The new chatbot by OpenAI has taken the world by storm, offering a breakthrough in chatbot development and usage and representing a bright spot for the entire sector. Palantir also said that it believes AI could help its business evolve further in 2023.

Chief Revenue Officer, Ryan Taylor, commented on the matter, saying that there are many different ways that Palantir could integrate with technologies such as ChatGPT. These technologies could then be added to the firm’s customer data. However, he did not confirm that the firm plans to actually do this.

Meanwhile, an RBC analyst Rishi Jaturia said that the company’s stock was up too much, given the fact that the Q4 2022 profitability was driven by the “below the line” adjustments, such as interest income. The quarter itself was in line with expectations.

Lastly, the company’s forecast for 2023 revenue is optimistic, sitting between $2.18 billion and $2.23 billion, but staying below $2.29 billion, accordion to analysts.