Palantir Hits $1B Revenue Milestone, Stock Plunges on Security Flaws
Palantir Technologies, the data analytics firm, has hit a significant revenue milestone of over $1 billion in the second quarter of 2025. However, its pltr stock faces headwinds due to a high valuation and an ongoing investigation into potential securities fraud related to a military project.
The company's stock surged after the positive Q2 results but later dropped by $13.98 or 7.47% to $173.07 following a public disclosure of security flaws in the NGC2 platform. This platform, developed with Anduril Industries, is part of a $100 million contract and contributes to Palantir's growing government business, which increased by 53% in the quarter.
The Army memo revealed over 200 security flaws, including 25 severe code vulnerabilities. These issues could grant adversaries 'persistent, undetected access' to military communication systems. Despite the denial from Palantir and Anduril, the revelation has sparked a class action investigation, casting a shadow over the company's previous success story and upcoming Q3 figures presentation. Multiple analysts have downgraded future targets, warning shareholders about the very high palantir stock valuation—over 30 times projected revenue—which is seen as excessively expensive.
Palantir's fundamentals remain strong with a 48% increase in total revenue. However, the ongoing investigation and high valuation pose potential risks. Shareholders should closely monitor the situation as growth must meet expectations to justify the current stock market price.
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