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Welcome back to Daily Palantir! Today we’ll discuss Palantir’s latest contract win, AIPCon, and their new price target upgrade. Let’s get into it!

At the time of writing this, Palantir is currently $27 in the pre-markets.

We haven’t seen a price like this since August 2021, which is pretty incredible to see.

Why is this happening?

Palantir is right in the middle of a perfect storm: the market wants AI, defense tech is surging, and the macroeconomy is holding up. As a result, companies that are executing against the thesis the stock market really cares about as the next big growth driver for the entire economy, AI, will be rewarded.

Palantir is being rewarded.

Palantir has officially received the TITAN contract. Now, this is a contract worth about $1.5B/5years, and today we got a 2-year prototyping phase for $178M.

From the contract:

TITAN is a ground station that has access to Space, High Altitude, Aerial, and Terrestrial sensors to provide actionable targeting information for enhanced mission command and long range precision fires. Palantir’s TITAN solution is designed to maximize usability for Soldiers, incorporating tangible feedback and insights from Soldier touch points at every step of the development and configuration process. Building off Palantir’s prior work delivering AI capabilities for the warfighter, Palantir is deploying the Army’s first AI-defined vehicle.

TITAN seeks to enhance the automation of target recognition and geolocation from multiple sensors to reduce the sensor-to-shooter (S2S) timelines through target nominations and fuse the common intelligence picture. TITAN integrates systems, technologies, and software from an industry-defining team of traditional and non-traditional partners — including, Northrop Grumman, Anduril Industries, L3Harris Technologies, Pacific Defense, SNC, Strategic Technology Consulting, and World Wide Technology. These companies all share the Army’s imperative to build continuously evolving and innovative systems. Their mutual focus on openness, interoperability, and modularity enables the team to deliver modern capabilities to the warfighter at rapid speeds. This best-in-class offering is scalable, adaptable, and designed for the needs of a rapidly evolving threat environment.

“This award demonstrates the Army’s leadership in acquiring and fielding the emerging technologies needed to bolster U.S. defense in this era of software-defined warfare. Building on Palantir’s years of experience bringing AI-enabled capabilities to warfighters, Palantir is now proud to deliver the Army’s first AI-defined vehicle,” said Akash Jain, President, Palantir USG. “Soldiers deserve best-in-class technology that gives them the tactical advantage on the battlefield, allowing for real-time decisions at critical speeds. Palantir is honored to support this program, to continue its partnership with the Army, and to lead a team of innovative partners to build the next generation of capabilities.”

Now, the reason this was so important was because Palantir actually beat Raytheon for this deal. As a result, Palantir won a prime contract, that typically are given to hardware companies, as a software company.

Wall Street saw that and reacted heavily. 200M shares were traded yesterday because Wall Street understood that if a company can get these types of deals, there are many more of those deals waiting in the future. More of those deals waiting in the future for Palantir means that they will be able to generate more revenue from the government, and if commercial is going to expand, then this is a company that absolutely will explode. As a result, the street would like to have exposure to it.

Beating Raytheon cannot be understated — it is not easy to beat a company with that much political influence, so seeing Palantir actually convince the DoD to change their procurement behavior and pick a software company just shows how much the world is changing in regards to how to government thinks of software that will actually work.

Palantir is going to have their 3rd AIP Conference today. The title of their PR for this event was “Palantir to Unveil New Customers at Oversubscribed AIPCon.” I’m pretty sure Karp told them to put “oversubscribed” in the title because he wanted to reinforce how hard it is to get into these conferences and how much demand the company truly has around their AIP product.

What’s really incredible about this is that this is their 3rd conference in less than a year — their first one was June 2023.

The partner/client list is also exciting, with companies like Lowes, Lennar, and OpenAI being at the conference. My bet is that OpenAI is some type of partner with Palantir for implementing AIP within enterprises given GPT-4 is one of the LLM’s that Palantir uses to power AIP. I’ll be live here if you are reading this before or you can watch the stream after if you missed it.

Here is the poster they put out for the event:

The tagline to the poster is “Compressing Time and Space.” I have no idea what that means, but maybe we will see some presentations around space, meta constellation (their geo spatial intelligence product) or how companies are saving more time becoming more efficient.

We should see new use cases in a variety of industries for how Palantir can implement AIP. Wall Street will be watching and if they like what they see, they may act.

Okay, so this was one of the best Wall Street Price Target upgrades we could have ever gotten.

Mariana even started her upgrade by speaking philosophically about the TITAN contract and comparing it to Greek Mythology, almost as if she was Alex Karp starting a shareholder letter. I could cry because of how happy she is for Palantir shareholders.

The crux of her argument here is that Palantir will now begin to get more government contracts because of this TITAN announcement. This is going to increase how the street perceives the company, add more fuel to the government revenue, and overall increase Palantir’s important geopolitically across the world as they help the US military/army in many situations.

JADC2 is going to be the DoD’s effort to connect all parts of the government dealing with defense into one central network — if Palantir actually becomes the digital backbone of this entire network, there will be billions of dollars waiting for them in the future and Bank of America is baking that into their price targets going forward this year.

This was one of the biggest days for Palantir, with multiple events compounding against each other, and allowing us to break $26 and then $27. Even if we were to fall back, the fact is, the company is executing at a high, high level.

I’ll see you later today with AIPCon coverage.

My newest software around Palantir will be announced in a newsletter tonight by 9PM — looking forward to showing it off, along with discussing AIPCon highlights!

That’s it for today, thank you for reading and I’ll see you in your inbox soon!

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