Goldman Sachs raised its 12-month price target on Palantir to $204 from $183 in a research note dated Aug. 4, while keeping a Neutral rating. The bank said the adjustment in its valuation multiple was driven mainly by lower peer valuation centers, not by any weakening in Palantir’s fundamentals.
Palantir reported second-quarter revenue of $1.95 billion, up 93% from a year earlier and 7% above market expectations. After the earnings release, the stock rose 15% in after-hours trading.
U.S. commercial growth reached 150%
Goldman’s note said Palantir’s U.S. commercial business grew 150% year over year in the second quarter, faster than 133% in the first quarter and above the 109% recorded for full-year 2025. It also came in ahead of prior guidance for growth of “more than 120%.”
Deal size expanded as well. Palantir recorded 220 transactions worth more than $1 million, including 98 above $5 million and 73 above $10 million. Average trailing-12-month revenue from the top 20 customers reached $124 million, up 67% year over year. Total contract value was $2.1 billion, up 118%, while net revenue retention stood at 157%.
Goldman said those figures point to improving revenue quality in the commercial segment and strong customer stickiness.
Government segment also accelerated
Palantir’s U.S. government business grew 90% year over year in the second quarter, up from 84% in the first quarter. The report said the Maven project is being adopted by more agencies and has been selected as the operating platform for a new project. More than 25,000 developers, military personnel, civilian staff, and contractors are building applications on the platform, indicating a broader ecosystem footprint.
With both the U.S. commercial and government businesses accelerating in the same quarter, Goldman said Palantir’s growth drivers are coming from more than one source. CEO Alex Karp has also set a goal of keeping U.S. business growth at current levels or higher over the next 18 months.
Goldman sees a shift toward multi-model enterprise AI
According to the note, Palantir’s next growth phase could come from a structural change in how enterprises deploy AI. Companies are increasingly using a mix of small language models, open-source models, and frontier models, switching among them depending on the task. Palantir’s platform, Goldman said, is positioned to connect those models within a single workflow.
The bank argued that the core demand is not just to run AI, but to run it inside existing workflows while maintaining control over data, business logic, and intellectual property. That is where Goldman believes Palantir’s platform fits.
Sovereign AI cited as an incremental demand source
Goldman also pointed to the spread of sovereign AI as another growth factor. Enterprises and government agencies are paying closer attention to data sovereignty in AI deployments, and Palantir allows customers to move and deploy workloads across different environments.
The note said large organizations do not want to hand over core business data to third-party model vendors, and they do not want to be locked into a single model. They need a unified platform that supports AI deployment across models and across environments. Goldman said that positioning gives Palantir a competitive moat in the AI application layer.
On competition, Palantir management said its solutions are designed to be portable, giving customers flexibility. The company, management said, has to keep winning business through value creation and innovation rather than lock-in. Goldman added that competition is getting tougher, but said Palantir’s differentiation lies in maintaining customer relationships through continued delivery of value.
Target price based on 60x forward free cash flow
Goldman’s $204 target is based on a 60x forward free cash flow multiple. With the stock at $125.65, the target implies about 62% upside, according to the report. Goldman said 60x may still look expensive, but it is down from the previous 65x, and the lower multiple reflects a reset in peer valuations rather than a weaker operating outlook for Palantir.
The bank also lifted its revenue forecasts for 2026 through 2028. It raised its 2026 estimate to $8.37 billion from $7.96 billion, its 2027 estimate to $12.87 billion from $11.59 billion, and its 2028 estimate to $16.82 billion from $14.85 billion.
Neutral rating remains in place
Despite the higher target, Goldman kept its Neutral rating. The note said the main concerns are that commercial growth could slow if macro conditions weaken and that competitive pressure is increasing. It listed continued acceleration in the government segment and stronger-than-expected expansion of the commercial sales team as upside risks.
The article, compiled and interpreted by Chaoxiang Research based on Goldman Sachs’ Aug. 4, 2026 report and public market information, frames Palantir’s latest earnings as near-term validation, while the move toward multi-model enterprise AI and sovereign AI is presented as a possible medium- to long-term growth driver.