After a historic rise.. this stock is threatened to drop 83% to only $26. Palantir's stock fell more than 9% on Tuesday, marking a decline for the fifth consecutive day as it continues to retreat from its all-time highs. The AI software provider's shares have slipped more than 15% over the past five sessions, after its excellent earnings report earlier this month pushed the stock to historic peaks. This report is the first in Palantir's history where its revenue exceeded the billion-dollar mark in a single quarter. Tuesday's decline coincided with a broader market downturn.
Palantir is the biggest gainer in the S&P 500 index in 2025 to date, with its stock rising over 100%. The company's shares have doubled as it capitalizes on the ongoing enthusiasm for AI, securing government contracts supported by President Donald Trump, who seeks to develop the agencies. Palantir's rise has propelled the company into the list of the top 10 U.S. tech companies and the 20 most valuable U.S. companies, while also making its stock incredibly expensive. The forward price-to-earnings multiple, which tracks future earnings compared to the stock price, has risen to over 245 times.
In comparison, tech giants like Microsoft (MSFT) and Apple (AAPL) record a price-to-earnings multiple of nearly 30 times, generating much larger quarterly revenues. The price-to-earnings multiples for Meta (META) and Alphabet hover in the twenties.