Palantir's AI Tools Propel Stock Surge Amid Defense Spending Boom

Palantir Technologies' shares soared after reporting a spike in quarterly sales driven by U.S. defense spending. The data analytics firm predicted continued sales growth, fueled by government contracts. CEO Alex Karp defended the company's surveillance technology while addressing scrutiny over contracts with U.S. Immigration and Customs Enforcement.

In early Tuesday trading, Palantir Technologies saw its shares jump 6.9% following a reported spike in quarterly sales, thanks in part to increased U.S. defense spending. The company, headquartered in Denver, is poised to add approximately $24.4 billion to its market value if the stock price of $158 holds.

Founded by billionaire Peter Thiel, Palantir experienced a notable 66% revenue boost from the U.S. government in the fourth quarter, reaching $570 million. This surge in government contracts lifted total sales to $1.41 billion, surpassing analysts' projections of $1.33 billion.

Despite the recent surge, Palantir shares are down 17% this year. CEO Alex Karp defended the company's surveillance tools amid growing scrutiny over contracts with U.S. Immigration and Customs Enforcement. Karp emphasized the safeguards in place to prevent government overreach.