No one is even close to Palantir, says Gil Luria
Speakers
Gil Luria
— Technology Strategist at D.A. Davidson
Summary
Gil Luria, DA Davidson's head of technology research, discusses Palantir's blowout results and argues its growth, profitability, and unique software model justify a premium valuation, while noting long-term political risk. He then weighs in on SpaceX's acquisition of xAI and the possibility of consolidating Elon Musk's entities, calling SpaceX the most valuable Musk property. Luria also says Tesla remains supported by self-driving and robotics opportunities despite a declining car business.
- Gil Luria says Palantir's results exceeded very high expectations and revenue growth accelerated from above 60% to above 70%.
- He argues Palantir has no close software peer due to data ownership, forward-deployed engineers, CEO relationships, and real AI problem-solving.
- Commercial revenue is growing much faster than government and should pass government within a few quarters; Rule of 40 score is 127%.
- Luria says Palantir's premium valuation is justified by execution but sees long-term political risk if the U.S. administration changes.
- The conversation covers SpaceX's acquisition of xAI and the possibility of eventually consolidating Elon Musk's entities.
- Luria views SpaceX as the most valuable Musk property and sees Tesla as well priced on self-driving and robotics despite a declining car business.
- Self-driving data could help Optimus robots, and Tesla is years ahead of Western peers outside China.
Ideas
Palantir is unmatched in software growth.
Palantir is in a class of its own among software companies. It exceeded very high expectations, with growth accelerating from more than 60% to more than 70%; commercial revenue grew 137% year over year and should surpass government revenue in a few quarters, while the U.S. government business still grew 66%. Its Rule of 40 score of 127%, profitability above Microsoft, Adobe, Oracle, and Salesforce, and three-to-four-times-faster growth reflect a unique model: owning customer data organization, forward-deployed engineers, direct CEO relationships, and a mission that solves real AI problems. The high valuation is justified by that execution, though a future U.S. administration change is a long-term political risk.
Tesla's self-driving and robots justify value.
Tesla's declining car business is being superseded by self-driving and robotics. Its self-driving data gives it billions of hours of video to help Optimus robots function, making it years ahead of Western peers outside China, and the stock remains well priced on that future.
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