Palantir Technologies Inc. · NASDAQ:PLTR

Palantir Technologies — Q3 2023 Earnings Presentation

37 slides from Palantir Technologies's earnings presentation, Nov 2, 2023

1. Slide 1: Q3 2023 Business Update

   Q3 ©2023 Palantir Technologies Inc. 2023 Business Update

2. Slide 2: Disclaimer Safe Harbor

   Disclaimer Safe Harbor This presentation contains “forward-looking” statements within the meaning of the federal securities laws, and these statements involve substantial risks and uncertainties. All statements other than statements of historical fact could be deemed forward-looking, including, but

3. Slide 3: Palantir stands with Israel

   Palantir stands with Israel. © 2023 Palantir Technologies Inc.

4. Slide 4: Q3 2023 Highlights

   Q3 Business Update Q3 2023 Highlights Fourth consecutive quarter of GAAP profitability; GAAP EPS of $0.03 Third consecutive quarter of GAAP operating profitability; 7% margin, up 2,000 basis points Y/Y Revenue grew +17% Y/Y to $558 million US commercial revenue grew +33% Y/Y to $116 million US comme

5. Slide 5: Q3 2023 TTM Highlights

   Q3 Business Update Q3 2023 TTM Highlights $147 million $36 million GAAP Net Income GAAP Operating Income $403 million $502 million $538 million US Commercial Revenue Adjusted Free Cash Flow Adjusted Operating Income +23% Y/Y 24% 25% US Commercial Revenue Adjusted Free Cash Flow Margin Adjusted Opera

6. Slide 6: Supporting Ukraine's Ministry of Digital Transformation with AIP

   Q3 Business Update Palantir is proud to support the Ministry of Digital Transformation of Ukraine as they accelerate Ukraine’s digital reconstruction with AIP. We are working on a technology that will help the state save millions, make effective management decisions, and become a virtual assistant f

7. Slide 7: Software used by 16% of US hospital beds

   Q3 Business Update —— HOSPITAL OPERATIONS Our software is used by 16% of hospital beds across the US, up from roughly 1% a year ago. We’ve been able to scale this across our acute in-patient units at 9 facilities, and we're looking ahead to the future. We'll be at 180+ hospitals... that's 90,000 nur

8. Slide 8: Ranked #1 vendor in Dresner Wisdom of Crowds study

   Q3 Business Update Palantir ranked #1 vendor in the 2023 AI, Data Science, and Machine Learning Wisdom of Crowds® Market Study published by Dresner Advisory Services. Read the report to see why Copyright 2023 – Dresner Advisory Services © 2023 Palantir Technologies Inc.

9. Slide 9: AIPCon customers unveiled their AIP workflows

   Q3 Business Update —— AIPCON HIGHLIGHTS At AIPCon➁, our customers unveiled their AIP workflows. Launched just five months ago, AIP is already used by nearly 300 organizations across sectors ranging from energy to finance, hospitality, and healthcare. ® © 2023 Palantir Technologies Inc.

10. Slide 10: AIPCon customer testimonials

    Q3 Business Update —— AIPCON HIGHLIGHTS We've got patients’ lives at stake, We like to say that, ‘We make what It is important that in real-time we … so the ability to have the tool matters work.’ Palantir is helping us can send out help right away. So that show us exactly where it found the focus o

11. Slide 11: From 0 to Use Case in 5 days or less

    Q3 Business Update —— AIP BOOTCAMP From 0 to Use Case in 5 days or less. Our new go-to-market approach for AIP Outcomes We’re on track to conduct AIP Bootcamps for more than 140 organizations 1/ Understand how to apply AI to mission-critical operations by the end of November. These immersive, hands-

12. Slide 12: AIP Bootcamp testimonial

    Q3 Business Update —— BOOTCAMP TESTIMONIAL I approached this engagement very critically [...] It’s hard for someone to come in and build a product in one day, especially when we have been working with other entities for months and hadn’t seen results. We worked with Palantir and got the results that

13. Slide 13: Enabling frontline innovators to go further, faster

    Q3 Business Update —— GOVERNMENT WEB SERVICES Enabling frontline innovators to go further, faster. By leveraging the technology built from our hard-earned experiences delivering to the government, our customers and partners can focus their attention on the next generation of development. © 2023 Pala

14. Slide 14: FedStart cuts accreditation to as little as 6 weeks

    Q3 Business Update —— FEDSTART FedStart transforms the usual 18 month, ~$2M accreditation process into something that can be done in as little as 6 weeks, and at a fraction of the cost. We’re proud to welcome our 9 newest FedStart partners NIH National Center for Advancing Translational Sciences © 2

15. Slide 15: Primer AI on FedStart

    Q3 Business Update —— FEDSTART At Palantir’s Software for Government Summit, Mark Brunner shared how Primer AI is reshaping defense with AI solutions, overcoming access and accreditation challenges through Palantir’s FedStart program. Palantir's FedStart program gave us that one-stop shop and an eco

16. Slide 16: Q3 Financials

    Q3 ©2023 Palantir Technologies Inc. 2023 Financials

17. Slide 17: US commercial accelerated in Q3 2023 alongside AIP

    Q3 Financials US commercial accelerated in Q3 2023 alongside AIP revolution +33% Y/Y +37% Y/Y US Commercial Revenue US Commercial Customer Count +13% Q/Q +12% Q/Q US Commercial Revenue US Commercial Customer Count 102 $252M 10x US Commercial Deals Closed US Commercial TCV +65% Q/Q 3-Year US Commerci

18. Slide 18: GAAP Net Income (Loss)

    Q3 Financials GAAP Net Income (Loss) We achieved GAAP profitability for $120.0M the fourth consecutive quarter. $71.5M Our Q3 2023 GAAP earnings per $60.0M share was $0.03, up $0.09 Y/Y. $30.9M $16.8M $28.1M $ ($60.0M) ($120.0M) ($123.9M) Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 © 2023 Palantir Techn

19. Slide 19: GAAP Operating Income (Loss)

    Q3 Financials GAAP Operating Income (Loss) We achieved GAAP operating $60.0M profitability for the third consecutive quarter. $40.0M $40.0M $20.0M $10.1M $4.1M $ ($17.8M) ($20.0M) ($40.0M) ($60.0M) ($62.2M) Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 © 2023 Palantir Technologies Inc.

20. Slide 20: US Commercial and US Government Revenue Growth

    Q3 Financials US Commercial Revenue Growth US Government Revenue Growth $120M $116M $250M $229M $100M +33% $225M +10% $88M $209M $80M $200M $60M $175M $40M $150M Q3 2022 Q3 2023 Q3 2022 Q3 2023 © 2023 Palantir Technologies Inc.

21. Slide 21: Commercial and Government Revenue Growth

    Q3 Financials Commercial Revenue Growth Government Revenue Growth $275M $325M $251M $308M $250M $300M +12% $225M +23% $275M $274M $204M $200M $250M $175M $225M $150M $200M $125M $175M Q3 2022 Q3 2023 Q3 2022 Q3 2023 © 2023 Palantir Technologies Inc.

22. Slide 22: Total Revenue Growth

    Q3 Financials Total Revenue Growth Total revenue grew 17% Y/Y, driven by the continued $558M acceleration of our US $550M commercial business. +17% $500M $478M $450M $400M $350M $300M Q3 2022 Q3 2023 © 2023 Palantir Technologies Inc.

23. Slide 23: Average TTM Revenue per Top 20 Customers and Billings

    Q3 Financials Average TTM Revenue per Billings Top 20 Customers $550M $550M $55M $54M +8% $509M $500M +13% $50M $48M $450M $45M $400M $40M $350M $35M $300M $30M Q3 2022 Q3 2023 Q3 2022 Q3 2023 Average TTM revenue per customer is defined as (a) the Company’s trailing twelve months of revenue as of ea

24. Slide 24: Adjusted Gross Margin

    Q3 Financials ADJ. GROSS MARGIN 82% 81% 81% 82% 80% Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 © 2023 Palantir Technologies Inc. Adjusted gross margin excludes stock-based compensation. Please see the appendix for reconciliations of this and other non-GAAP financial measures to the most directly compar

25. Slide 25: Adjusted Operating Margin

    Q3 Financials Q3 2023 adjusted operating income was We continue to invest $163M, representing a margin of 29% aggressively in AIP and the ADJUSTED OPERATING MARGIN US while driving operating $175M leverage at scale. $163M $150M 29% $135M $125M $125M 25% $114M 24% 22% $100M $81M $75M 17% $50M $25M Q3

26. Slide 26: Customer Count and Commercial Customer Count

    Q3 Financials Customer Count Commercial Customer Count +34% Y/Y +45% Y/Y 500 350 453 421 330 391 +8% 400 302 367 +8% 300 +9% 337 +7% 280 +9% +8% 300 260 +8% 250 228 200 +14% 200 100 TTM ENDED TTM ENDED TTM ENDED TTM ENDED TTM ENDED TTM ENDED TTM ENDED TTM ENDED TTM ENDED TTM ENDED SEP 30, 2022 DEC 3

27. Slide 27: 80 deals of at least $1 million closed

    © 2023 Palantir Technologies Inc. Q3 Financials The value of deals closed reflects the total contract value of contracts that have been entered into with, or awarded by, our government and commercial customers and includes existing contractual obligations and unexercised contract options During Q3 2

28. Slide 28: $3.3B in cash and treasuries; cash flow

    Q3 Financials Cash from Operations and We ended Q3 2023 with Adjusted Free Cash Flow $3.3B CASH FROM OPERATIONS ADJUSTED FREE CASH FLOW $150M $141M $133M in cash, cash equivalents, and US treasury securities and no debt. $100M $50M $47M $37M Q3 2022 Q3 2023 Q3 2022 Q3 2023 © 2023 Palantir Technologi

29. Slide 29: Q4 and FY 2023 Guidance

    Q3 Financials Q4 2023 FY 2023 For fourth quarter 2023, we expect: For full year 2023: Revenue of between We are raising our revenue guidance to between $599 million — $603 million. $2.216 billion — $2.220 billion. Adjusted income from operations of between We are raising our adjusted income from ope

30. Slide 30: Q3 Appendix

    Q3 ©2023 Palantir Technologies Inc. 2023 Appendix

31. Slide 31: Additional Metrics and Notes

    Appendix Additional Metrics and Notes ($ MILLIONS) Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Total RPO $ 1,254 $ 973 $ 936 $ 968 $ 988 Short-Term RPO $ 555 $ 517 $ 529 $ 558 $ 560 Long-Term RPO $ 699 $ 456 $ 407 $ 410 $ 428 Billings $ 509 $ 387 $ 614 $ 603 $ 550 Net dollar retention was 107% in Q3 202

32. Slide 32: Reconciliation to Adjusted Free Cash Flow

    Appendix Reconciliation of Cash Flow from Operating Activities to Adjusted Free Cash Flow and Adjusted Free Cash Flow Margin Adjusted free cash flow margin is calculated as adjusted free cash flow divided by revenue ($ THOUSANDS) Q3 2022 Q3 2023 T TM Q3 2023 Cash Flow from Operating Activities $ 47,

33. Slide 33: Reconciliation to Adjusted Gross Profit and Margin

    Appendix Reconciliation of Gross Profit to Adjusted Gross Profit & Adjusted Gross Margin Excluding Stock-Based Compensation Adjusted gross margin is calculated as adjusted gross profit divided by revenue ($ THOUSANDS) Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Gross Profit $ 370,269 $ 404,313 $ 417,541

34. Slide 34: Reconciliation to Adjusted Operating Income and Margin

    Appendix Reconciliation of Income (Loss) from Operations to Adjusted Operating Income and Adjusted Operating Margin Excluding Stock-Based Compensation and Related Employer Payroll Taxes ($ THOUSANDS) Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 T TM Q3 2023 Income (Loss) From Operations $ (62,191) $ (17,

35. Slide 35: Reconciliation to Adjusted EPS, Diluted

    Appendix Reconciliation of GAAP Net Earnings (Loss) Per Share, Diluted to Adjusted Earnings (Loss) Per Share, Diluted (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Q3 2022 Q3 2023 Net Income (Loss) Attributable to Common Stockholders $ (123,875) $ 71,505 Add / (Less): Stock-Based Compensation 140

36. Slide 36: Reconciliation of Revenue to Billings

    Appendix Reconciliation of Revenue to Billings ($ THOUSANDS) Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Revenue $ 477,880 $ 508,624 $ 525,186 $ 533,317 $ 558,159 Change in Contract Liabilities 30,807 (121,589) 88,614 69,952 (8,199) Billings $ 508,687 $ 387,035 $ 613,800 $ 603,269 $ 549,960 © 2023 Palan

37. Slide 37: Reconciliation to Adjusted Expenses

    Appendix Reconciliation of Cost of Revenue and Total Operating Expenses to Adjusted Expenses ($ THOUSANDS) Q3 2022 Q2 2023 Q3 2023 Total Expenses $ 540,071 $ 523,243 $ 518,176 Less: Stock-Based Compensation 140,308 114,201 114,380 Employer Payroll Taxes Related to Stock-Based Compensation 3,133 10,7

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