Q4 2021 Palantir Technologies Inc Earnings Call

Good morning, welcome to <unk> fourth quarter 2021, earning video conference, we'll be discussing the results announced in our press release and related materials issued prior to the market open and posted on our Investor Relations website.

Speaker 1: Good morning. Welcome to Palantir's fourth quarter 2021 earning video conference. We'll be discussing the results announced in our press release and related materials issued prior to the market open and posted on our investor relations web.

This morning, we will make statements regarding our business that may be considered forward looking within applicable securities laws, including statements regarding our first quarter and fiscal 2022 results management's expectations for our future financial and operational performance and other statements regarding our plans prospects and expectations.

Speaker 1: This morning, we will make statements regarding our business that may be considered forward-looking within applicable securities laws, including statements regarding our first quarter and fiscal 2022 results, management's expectations for our future financial and operational performance, and other statements regarding our plans, prospects, and expectations.

Speaker 1: These statements are not promises or guarantees and are subject to risks and uncertainties which could cause them to differ materially from actual results.

These statements are not promises or guarantees and are subject to risks and uncertainties, which could cause them to differ materially from actual results infill.

Speaker 1: Information concerning those risks is available in our earnings press release distributed prior to market open today and in our SEC file.

Information concerning those risks is available in our earnings press release distributed prior to market open today and in our SEC filings.

Speaker 1: We undertake no obligation to update forward-looking statements except as required by law.

We undertake no obligation to update forward looking statements, except as required by law.

Further during the course of today's earnings video conference, we will refer to certain adjusted financial measures. These non-GAAP financial measures should be considered in addition to as a substitute for or in isolation from GAAP measures.

Speaker 1: Further, during the course of today's earnings video conference, we will refer to certain adjusted financial measures. These non-GAAP financial measures should be considered in addition to, not as a substitute for, or in isolation from GAAP measures.

Speaker 1: Additional information about these non-GAAP measures, including reconciliation of non-GAAP to comparable GAAP measures, is included in our press release and investor presentation provided today.

Additional information about these non-GAAP measures, including reconciliation of non-GAAP to comparable GAAP measures is included in our press release and Investor presentation provided today.

Speaker 1: Our press release, investor presentation, and SEC filings are available on our investor relations website at investors.palantir.com.

Our press release Investor presentation, and our SEC filings are available on our Investor Relations website at investors dot talented dot com.

Speaker 2: Welcome to our earnings call from Denver. It's my maiden voyage.

Welcome.

To our earnings call from Denver, its maiden voyage.

Speaker 2: uh... and uh... obviously just a couple opening marks and then we'll uh... jump into questions uh... from the audience as it were

And obviously just a couple of opening remarks, and then we'll jump.

Jump into questions.

From the audience as it were.

Speaker 2: The, just a five minute, two minute.

The just a five minute to minute.

Speaker 2: When Palantir began, people believed that data was worthless, that software was a luxury item, and that we would fail. And, you know, one of the very interesting things that's happened to Palantir is we've been able to see how the world has changed dramatically in its perception of software and, of course, of us.

When parents here began people believes that data was worthless.

Software was a luxury item and that we would fail and one of the various thing things that's happened to Powershares, we've been able to see how the world has changed dramatically and its perception of software and of course of us.

From a world where software with something that you might want might be in your car, but de facto would not determine your business to a world where really the laws of finance are going to be.

Speaker 2: from a world where software was something that you might want, might be in your car, but de facto would not determine your business to a world where really the laws of finance are going to be.

Okay rewritten to deal with a world, where the only real note software and how do you measure it what does it look like how does it how do you understand when it's creating value how do you understand when it's declining in value how do you understand when it's when it's compounding to what extent is a compounding what devices do we use to measure that or the devices we use.

Speaker 2: rewritten to deal with a world where the only real note is software. How do you measure it? What does it look like? How do you understand when it's creating value? How do you understand when it's declining in value? How do you understand when it's compounding? To what extent is it compounding? What devices do we use to measure that? Are the devices we use to measure it the ones that we used in the past? Clearly this industry is in its infancy.

To measure it the ones that we used in the past clearly.

This industry is in its infancy, which also very special about this industry is it really is by and large geographically located and a small section of America.

Speaker 2: What's also very special about this industry is it really is by and large.

Speaker 2: geographically located in a small section of America, which is odd and there's lots of interesting reasons for that, but enterprise software is something that America is by far the best at.

Which is odd and theres lots of interesting reasons for that but enterprise software is something that America is by far the best at what we see currently apparent here. It's not just the best at building. It. It seems to also be the best at understanding what software what software developments are relevant for the world today.

Speaker 2: What we see currently at Palantir, it's not just the best at building it, it seems to also be the best at understanding what software developments are relevant for the world today. And adapting even when it's being offered by a company that in every way looks non-standard, run by people that are very different.

<unk> and adapting even win.

It's being offered by a company that in every way it looks non standard run by people that are very different.

Speaker 2: look different, feel different, talk differently, and with a CEO that many of you is batshit crazy. And so just as an interesting prelude, I don't want to take a ton of time with remarks, because I think when I'm watching these things, or someone talks too long, or there's a lot of canned remarks, I wonder why. And it honestly gets a little boring.

Look different feel different talk differently and.

With a CEO that many of you as Batshit crazy.

And so.

Just as an interesting preload I don't want to take a ton of time with remarks, because I think you know.

When I'm watching these things if someone talks too long or there's like a lot of canned remarks, I wonder why.

So I guess a little boring.

Speaker 2: uh... and that you know of course our legal department and i are department which are wonderful departments are have a keen ready to pull me out if i

And of course, our legal department and IR Department, which are wonderful departments or have a keen ready to pull me out if I I'm not like a caged animal in the 19 fifties Xu, but as I've mentioned to them. If you weren't caged animals 19 fifties Xu.

Speaker 2: I'm not like a caged animal in the 1950s zoo. As I've mentioned to them, if you want caged animals in the 1950s zoo, you can watch any other earnings update. So here, you see an interesting chart. We sent this out, some of you have probably looked at it. Some have maybe even studied it. Some of you haven't seen it. What's interesting here, what I thought would be very interesting for people who are investors, potential investors, also palantirians, both current and ex.

Can watch any other earnings update.

So here.

You see an interesting chart, we sent this out some of you probably looked at it some of maybe even studied it some of you haven't seen it whats interesting here, what I thought would be very interesting for people who are investors potential investors also talented <unk>, both current and X is our journey and what I actually believe this.

Speaker 2: is our journey and what I actually believe this is a metaphor for the journey of all software companies. We were very early into what whatever you want to call data exploration, building things that.

As a metaphor for the journey of all software companies. We we had we were very early into <unk>.

Whatever you want to call it data exploration building things that.

We know that would now be understand is useful software for building.

Speaker 2: you know, that would now be understand as useful software for building analytic tools. Some of them were and are, you know, very, very important for national security in other areas. But, but then we're not obviously because they were built and conceived in 2004, delivered in 2008, we're not actually able to migrate across the chain into what people need tomorrow, where people are already seeing that they need today, which is essentially...

Analytic tools some of them were and are very very important for national security and other areas, but but then we're not obviously because they were built and conceived in 2004 delivered in 2008 were not actually able to migrate across the chain into what people will need tomorrow, where people are already seeing that they need today, which is essentially.

Speaker 2: not having software as a raw material exploration. You take the data like it's oil, you pump it out, you turn it, and then you say you've turned the data and you move on. But actually, operationally determinative for your business. What you see here is cohort analysis.

Not having software as a raw material exploration you take the data like its oil you pump it out your churn. It and then you say you've turned the data and you move on but actually operationally determinative for your business. What you see here is cohort analysis.

Speaker 2: This is the, and what you see is from inception of Foundry, the decline of older software products and just the massive exponential growth. Obviously it's rough math, it's 100% growth year on year. And then starting last year, not off of a small integral, which is obviously very important because small numbers can grow quickly even if the software is not strong. Big numbers don't grow quickly if the software doesn't exist.

This is the and what you see is from inception of foundry.

The decline of older software products and just the massive exponential growth obviously, you've just rough math, that's 100% growth year on year, and then starting last year not off of a small integral which is obviously very important because you know small numbers can grow quickly even if the software is not shrunk.

Numbers don't grow quickly if the software it doesn't exist.

Speaker 2: especially given that our Salesforce is super nascent. We're building it quickly, but we only have 25 fully accredited software, fully accredited meaning they've been here for nine months or more. And what you see here, obviously the Kager here is just unbelievable and in like the 150 plus range, which is,

Especially given that our Salesforce is super nation, we're building it quickly, but we only have 25 fully accredited software fully credited meaning they've been here for nine months or more and what you see here obviously the CAGR here is just unbelievable.

You know like the 150 plus range, which is a.

Speaker 2: super interesting and I wanted to drop the f-bomb here but I was told that was probably inappropriate but you could definitely we've agreed that this is something like the Phoenix Rises.

Super interesting and I wanted to drop the F bomb here, but I.

I was told that we should probably inappropriate, but you could definitely we've agreed that this is something like the Phoenix rises.

Speaker 2: don't get this and the other thing is kind of anti-gravitational about this that you know it's easy to forget this is a company this is like we've been at this for you know

You don't get this and the other thing is kind of anti gravitational about this that you know it.

It's easy to forget this is a company. This is like we've been at this for over 15 years.

Speaker 2: There are certain laws of nature in business that we are defined, which is that a software company, software usually decays for lots of reasons, decays radically. So when you see a decline or a software product, it's also...

There are certain laws of nature in business that we are defined which is that a software company software usually the case for lots of reasons to case radically and so when you see a decline.

Or a software product is also basically not part of the law of nature for a software company to build new software really as far as I know we are the only software company in the World billing building transit tranche transformational software this far in and that's particularly important because most software companies have distribution.

Speaker 2: basically not part of the law of nature for a software company to build new software. Really, as far as I know, we are the only software company in the world building transformational software.

Speaker 2: this far in and that's particularly important because most software console any have distribution or they have a

Or they have a product.

Speaker 2: But they don't have distribution product and ability to build new products. Which is not a critique. These are great companies. They acquire companies. They're not that many companies to acquire, which is why even relatively weak companies get acquired at a very high price. Let's just look at the next chart, which is USG.

But they don't have distribution product and the ability to build new products. There's just not a critique. These are great companies. They acquire companies, they're not that many companies to acquire which is why even relatively weak companies get acquired at very high price. Let's just look at the next chart, which is a U S. G.

Speaker 2: At EOSD you have a very similar phenomenon where you see the inception of...

Do you have a a very similar phenomenon.

Where you see the inception of.

Speaker 2: of Foundry into the USG. This is, there's a lot here, there's a lot of qualitative stuff here that we can't explain, but one of the qualitative things that you kind of can get a sense of is Palant, the newer Foundry version not only grows, grows dramatically, with like, you know, this is like 65% growth.

Of our foundry into the U S. G. This is there's a lot here theres a lot of qualitative stuff here that we can explain but one of the qualitative things that you would you kind of can get a sense of his talented the newer foundry version not only grows grows dramatically.

With like you know this is like 65% growth.

Speaker 2: just without looking at it more precisely, but it's over 200% CAGR here, which is also like Phoenix Rises kind of thing. But what's qualitatively particularly important and very protective is this graphs pretty neatly onto what are the programs that are going to grow tomorrow. Where's the future of USG? What do we need in a world where people are recognizing it's very dangerous?

It just without looking at it.

With more precisely, but it's over it's like over 200% CAGR here, which is also like Phoenix rises kind of thing, but whats qualitatively, particularly important and very protective as these this is rep. This this graphs pretty neat.

Neatly onto what are the programs that are going to grow tomorrow, whereas the future of USG, what what what do we need in a world where people are recognizing it's very dangerous.

Speaker 2: And what would the product be that you would need to power that? And so, any case with that, I think we should head into questions.

And what would the products be that you would need to power that and so in any case with that.

I think we should head into questions.

Yeah.

Yeah.

Great. Thanks, Alex.

Speaker 1: Our first question is from Brent Thill with Jefferies. Brent, you'll receive a prompt to unmute, and please ensure your video is on.

Our first question is from Brent Thill with Jefferies, Brent you'll receive a prompt on mute and please ensure your video is on.

Speaker 3: Good morning Alex. When you go back to the sales... By the way, we can't see you....through your overall view on what you need to do on the Salesforce to get that building in the right direction and what your plans for capacity are as in 2022.

Thanks, Good morning, Alex.

When you go back to the sales other way, we can enhance <unk> through your Europe overall.

View on what you need to do on the sales force to do.

You get that building in the right direction and what your plans for capacity are added in 2022.

By the way it would have been wonderful to see you, but yes I think the question was what can we do to build on our building the sales force.

Next year or this year into next year.

The if.

So there are really two parts to the question one part I think is just to look at what's happening.

And so like what what is growing pallets here now and how can we accelerate it. So if you just what I wanted to do in this call and in future.

And counters.

Speaker 2: is to both, is to kind of, what I think is happening, and just to frame the question, what I think is happening at Palantir is you have what you saw in Silicon Valley 1.0 when Silicon Valley actually produced goods and services that people wanted, which was they built dual product, dual use products in government, and there was a handoff to commercial.

Is to both is to kind of what I think is happening and you're just a framework, but I think it's happening at Powell interiors you have what you like what you saw in in Silicon Valley 1.0, when Silicon Valley actually produced goods and services that people wanted which was they built dual product dual use products in government and there was a handoff to commercial and so that.

Speaker 2: And so that's going very well. So you see, even if you adjust for SPAC, organic growth in commercial last year, US was 80%, or just under 80% is like 76, 77%. But,

It's going very well so you see even if you adjust for spec organic growth in commercial last year U S was 80% or just just just just under 80% was like 70, 677%.

But.

Speaker 2: To your point, you see net dollar retention numbers, numbers that you financial people like, how much is it growing? What I would call actually organically, I guess you guys call net dollar retention. Very, very strong, like in the 150 range.

To your point.

And then you see dollar net dollar retention numbers numbers that your financial people like how much is it growing.

I would call actually organically I guess you guys called net dollar retention very very strong like in the $1 50 range, we have laser here.

Speaker 2: We have Glazer here, he'll pipe in with the, but it's roughly in that range. But what we do not have, you could look at it as a negative, it's like we basically are doing this with a very, very nascent, honestly, if I were not on TV, I would say bonkers small sales force. And so like that means two things. What does it mean on the positive side? It means that net dollar retention number.

Type in with a but it's roughly in that range, but what we do not have a you could look at it as a negative is like we do they basically are doing this with a very very nascent honestly, if I were not on TV I would say bunker small sale.

Salesforce and stuff like that that means two things what does it mean on the positive side. It means that net dollar retention number is awesome because my understanding of how this happens at other companies, there's like eight people running around begging the person to expand their deployment that that's not happening out here.

Speaker 2: awesome because my understanding of how this happens at other companies is like eight people running around begging the person to expand their deployment. That's not happening at Palantir. The salesperson there is the Foundry product by and large. So obviously that means we think we can get Lyft.

The salesperson there as the foundry product by and large so obviously that means we think we can get lift from hiring salespeople. We're doing that aggressively I think we have about 150 salespeople now.

Speaker 2: from hiring salespeople. We're doing that aggressively. I think we have about 150 salespeople now. We're in the market to hire aggressively across Palantir. Honestly, mostly not salespeople because we believe we live and die based on our ability to build products of tomorrow, deliver today. But we're hiring, gonna hire in the range of 200 people. Hiring and getting value out of them are two different things. And so I think one of the things that we will see going forward is how do we play these salespeople so that we can get as much lift from them as we're getting from the product itself. And we're at the beginning of that. And so it is the part of the people we've fully indoctrinated.

We're in the market to hire aggressively across balance here.

Asleep, mostly not salespeople because we believe we live and die based on our ability to build products of tomorrow deliver today, but we're hiring going higher in the range of 200 people hiring and getting value out of them are two different things and so I think one of the things that we will see going forward is how do we play. These salespeople so that we can get as much.

Lift from them as we're getting from the project itself and we're at the beginning of that and so it is the part of the people we've fully indoctrinated.

Speaker 2: or as normal people might say trained, are effective, but we've never done this before. That's a process. We're also looking at ways to learn from other companies. But that's going to happen over the next couple years. I think

Or as normal people might say trained.

Are effective but we've never done this before there'll be.

That's a process. We're also looking at ways to learn from other companies, but but thats going to happen over the next couple years I think.

<unk>.

Speaker 2: The primary driver of revenue in U.S. commercial this year will still just be

The primary driver of revenue in U.

U S. Commercial this year will still just be.

The way in which America the it organizations are actually bigger.

Speaker 2: the way in which America, the IT organizations are actually

Speaker 2: beginning to request without knowing Foundry sometimes what Foundry offers. The CEOs assume that this is available.

Beginning to request without knowing foundry, sometimes what foundry offers the Ceos assume that this is available there is no other product on the market that can actually move from you know data warehouse, which is like there's like five companies. They offer the same thing foundry interacts with all of them. When you move on and move up to the chain to actually solving a real problem because.

Speaker 2: There is no other product on the market that can actually move from, you know, data warehouse, which is like there's like five companies. They all offer the same thing. Foundry interacts with all of them. When you move up to the chain to actually...

Speaker 2: solving a real problem because it defines your business. Foundry is highly different.

The defined your business foundries highly differentiated so we will layer that I think it's way too early to know exactly the impact obviously to the extent we get this to work you could expect even higher growth than what we have although.

Speaker 2: So we will layer that. I think it's way too early to know exactly the impact. Obviously, to the extent we get this to work, you could expect even higher growth than...

Speaker 2: I'm very happy with it. It was like we've dealt with USG, US Commercial, now.

I'm very happy with it was like we've dealt with USG U S. Commercial now you know from 50 to 100 102 hundred I believe we will double it again this year. So and again. These are some of this is unknown, but we are working very aggressively is the other thing I would say outside of the U S again, a slightly longer answer, but one of the ways.

Speaker 2: you know, from 50 to 100, 100, 200, I believe we will double it again this year. So, in any case, some of this is unknown, but we are working very aggressively. The other thing I would say outside is...

Speaker 2: The US, again, a slightly longer answer, but one of the ways people look at Palantir is, you know, if you're going to, I think a financial analyst likes to, what we would call in science, normalize the data, what you in finance would probably call strip out the inner organic inputs.

People look at <unk> as you know if you're going to.

I think a financial analyst likes to ignore what we would call them science normalize the data what you finance would probably call strip out the inorganic inputs.

Speaker 2: But I think if you're stripping out the inorganic inputs, you also have to look at what I would essentially view as an inorganic input of COVID in Europe .

But if I think if you're stripping out the inorganic inputs. You also have to look at the what I would essentially view as an inorganic input of Covid in Europe . If you strip and so Europe has been slow for US all of last year, which is one of the reasons why you know we are only at 41%.

Speaker 2: last year which is one of the reasons why we are only at 41 percent.

Speaker 2: Last year in growth would be even higher. Europe grew if you include SPACs at 9%, so slightly above what's probably inflation. But there we're taking the opportunity believing there'll be a handoff from USG.

Last year in growth would be even higher Europe grew.

If you include specs at 9%, so slightly above what's probably inflation.

But there we're taking the opportunity, believing there will be a handoff from USG T U S com to Europe to rebuild.

Speaker 2: to US Comm, to Europe , to rebuild with some very, very strong sales people who've come from the best companies, believing that that's an environment where we can really do that. So there's two ways to look at this.

Some very very strong sales people who've come from the best companies, believing that that's an environment, where we can really do that so like there's two ways to look at this just on that angle you can say well what could you do to gas charge America.

Speaker 2: just on that angle you could say, well, what could you do to gas charge America?

We're working on that and very very aggressively in most of our sales hires today are focused on that but theres. Another more long term thing if you're if we're right that.

Speaker 2: We're working on that and very, very aggressively, and most of our sales hires today are focused on that. But there's another more long-term thing. If we're right that the world wants Silicon Valley the way it was, meaning a handoff from government to commercial to the rest, commercial US to the rest of the world, and with each one with a lag, America to Europe 18 months.

The World wants Silicon Valley, the way it was meaning a handoff from government to commercial to the rest of the commercial U S to the rest of the world and with each each one with a lag America to Europe 18 months. The rest of this company only has to grow everything Besides Europe commercial 38% to get 30% growth in aggregate so <unk>.

Speaker 2: The rest of this company only has to grow everything besides Europe commercial 38 percent to get 30 percent growth in aggregate. So getting Europe to track better, both from a handoff of what happens in America to Europe and with more conventional sales approach is kind of what we're looking at getting done this year and see the fruits of it.

Getting Europe to track better both from a handoff of what happens in America to Europe , and with more conventional sales approach is kind of what we're looking at getting done this year and see the fruits of it next year.

And just a quick follow up on the government I know you had a tough comp it did decelerate pretty materially in Q1 in terms of the growth can you give us your perspective on what's happening on the government side.

Speaker 3: And just a quick follow up on the government, I know you had a tough comp, it did decelerate pretty materially in Q1 in terms of the growth. Can you give us your perspective on what's happening on the government side?

Well, there's a couple of things that are happening there. So if you were.

Speaker 2: Well, there's a couple things that are happening there. So if you were looking at this more like from a scientific perspective, you had a time series of 15 years, first thing you would do is say, okay, what's happening in that time series over the 15 years? What you see in USgov is a compounded growth of 30%, but like this, which is, you know, the positive of USgov is it's reliable, the sums are big, the quality of revenue is very high.

We're looking at this more like from a scientific perspective yet.

You know a time series of 15 years first thing you would do is say, okay. What's happening in that time series over the 15 years, what you see in U S. Gov is a compounded growth of 30%, but like this which is you know the positive of U S. Gov is it reliable the sums are big the quality of the revenue is very high.

Speaker 2: the one of their, essentially there are a number of problems, but biggest problem is barrier to entry.

The one of their central there are a number of problems, but the biggest problem is barrier to entry, which we've clearly salt and then re barriers to entry, which we've solved.

Speaker 2: we've clearly solved, and then rebarious entry, which we've solved or are solving, but that's going very well. And then the second one is lumpiness. Now you, that lumpiness...

Or are solving but that's going very well and then the second one is lumpiness now you that that lumpiness still exists and actually in some ways. It's it's worse because to get the integral to grow you need. These massive deals. We also have small deals, but the fact that we are on the biggest most important parts of the.

Speaker 2: still exists and actually in some ways it's worse because to get the integral to grow you need these massive deals.

Speaker 2: We also have small deals, but de facto, we are on the biggest, most important parts of

Speaker 2: the US government or software is. So there's really a two-fold answer to your question. One, what will happen this year? Are there, is a deceleration an actual one over a long time series? The answer is, no.

The U S government or a software is.

So there's really a twofold answer to your question one what will happen this year or there is a deceleration in actual one over a long time series. The answer is clearly no. But then the question is if the baseline is 30, how does it get to where we want it which is like the beginning of last year and not at the end of it.

Speaker 2: clearly no. But then the question is if the baseline is 30, how does it get to where we want it, which is like the beginning of last year and not at the end of last year. And the way that happens is the deals were already positioned to win actually close.

Last year in the way that happens is the deals were already positioned to win actually close.

Speaker 2: And so then you get into the granularity of what will happen in the US government, who gets the deals if there's

And so then you get into the granularity of what will happen in the U S government.

Who gets the deals if the if theres no new budget.

Speaker 2: There's a lot of granularity there, which we should probably do a better job of sharing, but the short answer is it's like whose chair gets pulled first? The people are trying to enter the market first, last.

There's a lot of granularity there, which we should probably do a better job of sharing but the short answer is.

It's like Who's chair it gets pulled first it get the people are trying to enter the market first our last so the new startups totally screwed because the people who are not sitting on a crucial programs partially screwed. The people that have software that is or products are you.

Speaker 2: because the people who are not sitting on crucial programs.

Speaker 2: partially screwed. The people that have software that is or products that are useful in the past but have the right connections probably do. Another version of this is if you just look at that chart I showed you with the CAGR.

For in the past, but have the right connections probably deal which another version of this is if you just look at that chart I showed you with the CAGR on foundry. These are the most important programs for a dangerous world now can't go into all the details, but you know we used to debate with people, especially my academic trends if the world was dangerous.

Speaker 2: on Foundry. These are the most important programs for a dangerous world.

Speaker 2: I can't go into all the details, but we used to debate with people, especially my academic friends, if the world was dangerous.

Speaker 2: The danger of the world being clear and present to the US government is very protective. It doesn't guarantee that, you know, when this integral actually, how it behaves, but it makes it much more likely that it will happen in a year and positively affect our revenue, which is another reason why I suspect that we will.

The danger of the world being clear and present to the U S. Government is very protective doesn't guarantee that.

When this integral actually how it behaves but it makes it much more likely that it'll happen in year and positively affect our revenue, which is another reason why I suspect.

That that we will do.

Be well.

Great. Thanks, Brent our next question comes from pound here shareholder Chase P.

Speaker 1: Great. Thanks Brent. Our next question comes from Palantir shareholder Chase P.

Yes. Thanks, so much for fielding my question I really appreciate the opportunity.

Speaker 3: Yeah, thanks so much for fielding my question. I really appreciate the opportunity.

Speaker 3: First and foremost, congratulations on all the hard work. It seems like you guys have a great team and are executing really well.

First and foremost congratulations on all the hard work. It seems like you guys have a great team and are executing really well.

Speaker 3: From a retail investor perspective, the most negative sentiment I hear regarding Palantir is in regards to the dilution of shares outstanding over the past 12 to 18 months, and primarily in relation to stock-based compensation that's occurred.

From a retail investor perspective, the most negative sentiment regarding pound here is in regards to the dilution of shares outstanding over the past 12 to 18 months and primarily in relation to stop.

Stock based compensation that's occurred other than the remaining shares to be invested that have already been announced can we expect further dilution in share offerings going forward or is it kind of reasonable to assume that the majority of this was from the IPO process and sort of a one time.

Speaker 3: Other than the remaining shares to be vested that have already been announced, can we expect further dilution in share offerings going forward? Or is it kind of reasonable to assume that the majority of this was from the IPO process and sort of a one-time event for the company? Once again, thanks and congratulations on all the hard work in business development.

Then for the company once again, thanks, and congratulations on all the hard work and business developments.

Speaker 2: Thank you and I really appreciate you investors. Thanks for investing in the faith you have in us.

Thank you and I really appreciate you investors thanks for investing in.

And the faith you have enough. Okay. So there's there's like the simple version, which I think you know it's like so there's really there's stock based comp and their solution dilution thing that's a red herring, we're not issuing a lot of new shares I think it's like in the $9 million range and so it would be a little coy of me to say that's like no issue.

Speaker 2: OK, so there's like the simple version, which I think, you know, it's like, so there's really there's stock based comp and there's dilution. One thing, that's a red herring we're not issuing a lot of.

Speaker 2: new shares, I think it's like in the $9 million range. And so it would be a little coy of me to say that's like no issue move on. The thing to understand about Palantir and then I want to just hit this is like, it's actually not the result of the DPO, it's the result of the fact that we were completely focused on building product, we had no earthly idea we were going to DPO to like, right before we did it. And so most companies are, I mean, quite frankly built

On the the the thing to understand about pounds here and then I want to just hit this is like it's actually not the result of the D. P. O. It's the result of the fact that we were completely focused on building product. We had no earthly idea, where you're gonna DPA to like right before we did it and so most companies are I mean quite frankly built.

Speaker 2: so that when analysts look at it, the primary customer of most software companies is not the client, it's the software.

So that the you know when analysts look at it the primary customer of most software companies is not the client. It's the software analyst. So it's like we obviously, our primary client or clients, which doesn't mean now we're thinking about how do we exposed to data in a way that you know people on the outside like you and professional analysts and others can look at the data and.

Speaker 2: So it's like we obviously, our primary client, are our client.

Speaker 2: which doesn't mean, you know, now we're thinking about how do we expose the data in a way that, you know, people on the outside like you and professional analysts and others can look at the data and get a better sense of what's tracking what's not tracking. But the primary source of a lot of these like questions really comes down to, look, we built the company to support the US warfighter primarily and then do Kate dual use it for the glory of humanity, particularly humanity in the West. And that was our idea. And because that the primary our primary client was not what, you know, someone at a hedge fund would think we didn't actually think of these things from inception. And so so now there's a process of normalization. You're going to see that.

Get a better sense of what's tracking what's not tracking but the primary source of a lot of these like questions really comes down to look we built the company to support the U S. Warfighter, primarily and then do dual use it for the glory of humanity particular humanity in the west and that was our idea and because that the primary our primary client was not.

You know someone at a hedge fund would think we didnt actually think of these things from inception, and so so now there's a process of normalization you're going to see that in going forward. On these calls just like how do you normalize how do you provide data that people can look at how do you provide data that people can understand.

Speaker 2: in going forward on these calls. It's like, how do you normalize? How do you provide?

Speaker 2: data that people can look at, how do you provide data that people can understand that they're used to seeing while simultaneously...

That they're used to seeing while simultaneously staying true to what our our our mission is just like our primary clients are the people. We're serving we're in full line with them and that's why we survive even with the nation Salesforce you can get things to double.

Speaker 2: staying true to what our mission is. It's like our primary clients are the people we're serving. We're in full line with them, and that's why we survive. Even with the nation's sales force, you can get things to double, which is insane. So then you get to

As of which is insane. So then you get to stock based comp which is like okay. So in there's two there's two parts of it of course IRI people kind of don't want me to do any kind of forward looking math, but you know if you're smart enough to invest in pound here, you're smart enough to figure out there is essentially.

Speaker 2: IRI people kind of don't want me to do any kind of forward-looking math, but, you know, if you're smart enough to invest in Palantir, you're smart enough to figure out there's essentially, there's the what does, how are we comping people, and there will be a normalization that will get us into a range where you would see in a software company within the next 18 months, latest two years. But there's essentially, and that's going to take a little time, it is going to happen, because it's also very much linked to another question, which is how do you actually run the company so it's profitable someday on a gap basis, not stripping out comp, and that is also within iSight, and those are

There's the what does what what are how are we comping people and they're there will be a normalization that will get us into a range, where you would see in a software company within the next 18 months latest two years, but theres, a essentially and that that's going to take that's going to take a long time. It is going to happen because its also very much linked to another question, which is how do you.

Actually run the company. So it's profitable someday on a GAAP basis, not stripping out comp in that that is also within eyesight and those are those are our goals for parents here because same reason we have no debt same reason, we have $2 $3 billion on our balance sheet. This is a company built for bad times Bad times means strong finances internally and that means at some point you have.

Speaker 2: not stripping out comp, and that is also within eyesight, and those are goals for Palantir because same reason we have no debt, same reason we have $2.3 billion on our balance sheet. This is a company built for bad times.

Speaker 2: Bad times mean strong finances internally, and that means at some point you have to be gap profitable. You can't be gap profitable if you're diluting people or what you correctly, your high, your stat, your, your, your, your stock-based comp is totally is not in conformity with other companies. So you're seeing a normalization. This will change.

To be GAAP profitable you can't be GAAP profitable, if you're diluting people are what you correctly your heart.

Your stock based comp is totally out is not in conformity with other companies. So you're seeing a normalization. This will change it will change in the relatively near future. It will be linked to other things that we believe are important for poucher like having a company that thrives in bad times and we are bad times are very good for pallets here, because we build products that are.

Speaker 2: It will change in the relatively near future. It'll be linked to other things that we believe are important for Palantir, like having a company that thrives in bad times. And we are. You know, bad times are very good for Palantir because we build products that are robust, that are built for danger, and then the finances internally are actually built for bad times.

Our robust that are built for danger and then the finances internally are actually built for bad times and bad times means you have free cash flow the free cash flow turns into GAAP profit that means to stop stock based comp has to be one that is aligned with our investors.

Speaker 2: And bad times means you have free cash flow. The free cash flow turns into gap profit.

Speaker 2: That means the stock-based comp has to be one that's aligned with our investors also because that's basically, you know, it's part of a little bit longer philosophical narrative. But like, if software's the only way to do it, then it's not going to be the best way to do it.

Because that's basically it's part of a little bit longer philosophical narrative, but like if software is the only moat than value and grow shares have to be a very you'll evaluate in terms of value value only exists. If you can actually get a tech note call. It maybe something besides and growth only exists if you build a company that.

Speaker 2: then value and gross shares have to be evaluated in terms of their value. Value only exists if you can actually get a tech note, call it that, maybe it's something besides, and growth only exists if you build a company that is where the technology is strong enough, the business fundamental is strong enough that the free cash flow actually turns into gap profitability. And that's linked to stock. So this is a priority both because you care but also quite frankly because it is the health of our company, which we care.

Is where the technology is strong enough the business fundamentals are strong enough that the free cash flow actually turns into GAAP profitability and that's linked to stock their shelves. So this is there's a priority both because you care, but also quite frankly, because it is.

As the health of our company, which we care a lot about.

Great. Thank you chase.

Speaker 1: Great, thank you Chase. Our next question is from Keith Weiss with Morgan Stanley . Keith, you'll receive a prompt to unmute. And please ensure your video is on.

Our next question is from Keith Weiss with Morgan Stanley Keith you'll receive a prompt on mute.

These ensure your videos on.

Excellent. Thank you guys for taking the question and thank you Alex.

Speaker 4: Thank you guys for taking the question and thank you Alex and neighbors in New Hampshire.

And any neighbors in new Hampshire.

I'll say in New York.

Hello.

So.

Speaker 4: So two questions, one on the product side of the equation.

Two questions one on the product side of the equation.

And the other on sort of investments into 2022 on the product side of equation.

Speaker 4: And the other on sort of investments into 2022 on the product side of the equation. Um, Alex, maybe I hope you can help us sort of better understand the product roadmap on on a go forward basis. How you guys are thinking about it from a high level. Um, from from our perspective, you guys did a really nice job of better modulating the platform and made it more. Um, adoptable by commercial enterprises, and I think it looks like we've seen that traction in terms of customer adoption. Um, what's kind of the on a go forward basis. Is there more activity of that? Like, pre built solutions, if you will more directly target some of these sort of opportunities that you've been used for, but productize it, if you will, is that a potential product direction?

Maybe I was hoping you could help us sort of better understand the product road map on a go forward basis. How you guys are thinking about it from a high level.

From our perspective, you guys did a really nice job of better moderately rising the platform and made it more adoptable by commercial enterprises.

It looks like we've seen that traction in terms of customer adoption.

Just kind of on a go forward basis is there more activity of that if you will do you create more salt Lake.

Prebuilt solutions, if you will more directly target some of the opportunities that you have been used for but product ties. It. If you will is that a potential product direction and then on the other side of equation in terms of investments.

Speaker 4: And then on the other side of the equation in terms of investments, investing for growth into 2022, I was hoping to give us a little bit of visibility into the nature of those investments. Is it just sales headcount? Is it the forward deployed engineers? How should we think about where those dollars are being deployed?

Testing for growth into 2022, I was hoping you could give us a little bit of visibility into the nature of those investments is it just sales head count as a forward deployed engineers, how should we think about where those dollars are being deployed thank you very much.

Thank you for your question and.

Speaker 2: question. And so actually, to my perspective, they're very much linked, our primary investment in growth is product is investment in product. And we're doing a number of things in product. But the things we've talked about a general level is kind of making our product more modular. There's a slightly more macro riff here, which is that we were adversarial with it structurally until recently, we are adversarial because

So actually that's my perspective, they're very much linked our primary investment in growth is product is investment in product and we're doing a number of things in product.

But the things we've talked about at a general level is kind of making our product more modular theres a slightly more macro riff here, which is that we were adversarial with I T structurally.

Until recently, we were adversarial because.

Speaker 2: from our perspective there's a learning process where they had to build these things. Now there's a myriad of companies, they're all honestly technically hard to...

From our perspective, there's a learning process, where they had to build these things now theres a myriad of companies.

Theyre, all honestly technically hard to.

Speaker 2: indistinguishable doing data lakes and all sorts of things that help IT people build something that is working for them to do certain things.

Distinguishable doing data lakes, and all sorts of things that help.

People build something that is working for them to do certain things and we were adversarial because they were like okay. This foundry thing yeah, great, but we've already built the saying you would replace this it may honestly could also make us look bad no. One wants it also the average sale price for parents here foundry of course, our business I think last year was like $6 5 million.

Speaker 2: And we were adversarial because they were like, okay, this foundry thing, yeah, great, but we've already built these things. You would replace this. It may honestly could also make us look bad. No one wants it. Also, the average sale price for Palantir foundry cost our business, I think, last year was like $6.5 million. Most IT people prefer a small bite and consumption. You can argue whether that's the right model, but instead of fighting them...

I T people most people prefer a small bite and consumption you can argue whether that's the right model, but instead.

Instead of fighting them, it's probably better to figure out a way to get our product more in their hands. So that that's kind of the known part.

Speaker 2: it's probably better to figure out a way to get our product more in their hands. So that's kind of the known part.

Speaker 2: What we've been working on recently, which is less known, is what we're really working on is we believe...

What we've been working on recently, which is less known is what we're really working on is we believe that you know people are paying a lot now for consumption in compute.

Speaker 2: that people are paying a lot now for consumption and compute.

No critique, but in reality, that's very much like paying for gas and oil exploration, but what people are really going to want is the ability to use the fully digested product. It's like when you're driving your car that's minerals and oil products in all sorts of chemicals built into your car finished product so and we're going to build both modules.

Speaker 2: But in reality, that's very much like paying for gas and oil exploration. But what people are really going to want is the ability to use the fully digested product. Because when you drive your car, that's minerals and oil products and all sorts of chemicals built into your car, finished products.

Speaker 2: So, and we're going to build both modules that are reflective of Foundry, but also new ones in areas that we understand, and quite frankly, we know will be built in the near future so that things we know are working, things that we suspect will work in the future, so that the nodes not only work separately, but can work together. So, de facto, we believe the compute of tomorrow won't be just compute. It will be productized compute.

Our reflective of foundry, but also new ones in areas that we understand and quite frankly, we know will be built in the near future. So the things. We know are working things that we suspect to work in the future. So that the nodes not only work separately, but can work together. So the fact, though that we believe the compute of tomorrow won't be just compute.

It will be product ties compute and that's what we're actually working on rebuilding foundry. So that there is still that doesn't mean like the foundry is in aggregate. We can do the whole thing tomorrow thing massively valuable and we're working on very very large deals where companies are like look we want to transform what we're doing or take what we're doing and export it to <unk>.

Speaker 2: And that's what we're actually working on in rebuilding Foundry. So there's still, that doesn't mean like the Foundry as an aggregate, we can do the whole thing tomorrow thing, massively valuable. And we're working on very, very large deals where companies are like, look, we want to transform what we're doing, or take what we're doing and export it to every company in our industry tomorrow. The fact though, that's a founder use case. And I don't think there's anything else that does that. Because you can take, for example, there's a very large company in the healthcare industry, and they're going to be able to do that.

Every company in our industry Tomorrow, the fact, though that as a foundry use case and I don't think there's anything else that does that because you can take for example, there's a very large company in the health care space.

Speaker 2: And it's like they have a very interesting way of doing health care. They can't sell it to other people without that essentially being a software offering. That would be three years or it could be two weeks.

And it's like they have a very interesting way of doing health care. They can't sell it to other people without that essentially being a software offering building that would be three years or it could be two weeks. So did that so that we're very much committed to continuing doing because there's like we're an N of one there, but where we wanted to be as an N of one on not just making it small we like that because then we see.

Speaker 2: So that we're very much committed to continue doing because we're an N of one there. But where we want to be is an N of one on not just making it small. We like that because then we see the IT departments now saying, okay, we have all these things and now we want to migrate here and then selling them something that they can actually bite into. So it's, because the primary resistance to Palantir has never been lack of Salesforce, lack of it's been resistance on inside of the IT structure.

The it departments now, saying, Okay. We have all these things and now we want to migrate here and then selling them something that they can actually bite into so it's because the primary resistance to parents here has never been lack of salesforce lack of it's been resistance on inside of the the structure and so now we're going to give them something they want and then also build an ecosystem.

Speaker 2: And so now we're going to give them something they want, and then also build an ecosystem around it so it's what I think people will want going forward. And so people can stop just buying pure compute. They can buy.

Around it so it's what I think people want going forward and so people can stop just buying pure compute they can buy valuable compute so that's actually a big project I would tell you on that end and on these other ends which particularly interesting.

Speaker 2: valuable compute. So that's actually a big project. I would say on that end, and on these other ends, what's particularly interesting, I mean, it's obvious, but you know, it's not just the dollars, it's like who's spending them. Just like the charisma of what we're doing. We're getting, we're a company that's like 15 years old and say like from revenue 18 years old from concept for the is a company like ours should be getting declining talent.

It's obvious but it's.

It's not just the dollars, it's like whose spending them just like the charisma of what we're doing for we're getting we're a company. That's like 15 years old and say like come from revenue 18 years old from concept for the <unk> is a company like ours should be getting declining talent. The talent. We're getting now is the best in the world. It's the best we've ever gotten in we're getting <unk>.

Speaker 2: The talent we're getting now is the best in the world, the best we've ever gotten, and we're getting people who used to be at Palantir. Everyone knows how good our people.

Who used to be a pound here.

Everyone knows how good our people who are coming back.

Speaker 2: just used to be like no company of our pedigree get people coming back it are good and the reason they're coming back because this is just fucking cool

Just like no company of our pedigree gets people coming back at all because the reason they're coming back is because this is just fucking cool. It's like you do this you changed the world now Theres a lot of other things we're working on the side to actually make sure one of the things. We failed at honestly is capturing the value of what we've done most of them.

Speaker 2: It's like, you do this, you change the world. Now, there's a lot of other things we're working on the side to actually make sure. One of the things we failed at, honestly, is capturing the value of what we've done. Most of the products you would see on a map in an industry, any company, they're delivering things we built seven years ago. We failed in capturing the value of that. We're not gonna fail again.

The products you would see on a map in the industry any company there.

Liberating things, we built seven years ago, we failed in capturing the value of that we're not going to fail again, we failed in capturing the value of that because we were selling to <unk> and selling to people in an adversarial way and we are sure. We were seven years eight years ahead, but eight years ahead, but they can actually interact with you.

Speaker 2: We failed in capturing the value of that because we were selling to IT and selling to people in an adversarial way. And sure, we were seven years, eight years ahead, but eight years ahead, but they can actually interact with you.

That's not the right way to do it and we're not going to do it that way in America. So were building specialized sale, so which means it will take longer to get it to work because we're working on and in Europe , we have a differentiated on the on the idea that so if you just look at the raw numbers. If you look at like you know where we are investing in it's like sales hires very high and salespeople in Europe and.

Speaker 2: That's not the right way to do it. And we're not going to do it that way in America. So we're building specialized sales, which means it will take longer to get it to work. We're working. And in Europe , we have a differentiated on the on the idea that. So if you just look at the raw numbers, if you look at like, you know, where we're investing in, it's like sales hires, very high end sales people in Europe . And then the rest is just like the best tech engineers in the world because.

Then the rest is just like the best Tech engineers in the world because we.

Speaker 2: We know, we get them, we retain them, and it's just very differentiated. That's super helpful.

We know we get them we retain them.

And it's just a very differentiated.

That's super helpful.

Great. Thanks, Keith are.

Our next question comes from Pelletier shareholder Brian L.

That Kurt Thank you for taking my question and thank you for furthering the ideals of western democracies around the globe of the thousand plus royalty intend to hire this year, how many of those will be focused on sales.

Speaker 4: Dr. Karp, thank you for taking my question and thank you for furthering the ideals of Western democracy around the globe. Of the 1000 plus roles that you intend to hire this year, how many of those will be focused on sales?

So we're we're looking to hire.

Speaker 2: So we're looking to hire 200 salespeople basically and everyone else is like just like in the past. So the way I think about it is like 70 X salespeople it's like so 75% technical. We're going to try and hire 200 salespeople. And then as I mentioned, we just hired some very high end sales acumen in Europe . Yeah. Thank you for your question.

200, salespeople basically and everyone else's like just like in the past so the way I think about it it's like 70 X salespeople. It's like I said, it's still 75% technical I'm going to try and hire twos 200 salespeople.

Then as I mentioned, we have just hired some very high end sales.

Acumen in Europe .

Yeah. Thank.

Thank you for your question and thank you for being an investor.

Great. Thanks, Brian .

Speaker 1: Great, thanks Brian . Our next question comes from Mark Cash with Morningstar. Mark, you'll receive a prompt on mutual line and please ensure your video is on.

Our next question comes from Mark cast with Morningstar.

You'll receive a prompt on mute your line. Please ensure your videos on.

Oh, yes, yes, thanks for taking the question.

Speaker 5: Thanks for taking the question. Kind of going off what you were just talking about, there's been commentary in the past around becoming the operating system for commercial industries. You talked about airline industry, maybe just talked about healthcare for a little bit there. But are there other industry examples you could talk about how that's pulling in customers to standardize operations around Palantir?

Kind of going off what you were just talking about you know there's been commentary in the past around becoming the operating system for commercial industry as you've talked about airline industry, maybe just talk about health care for a little bit there, but are there. Other examples industry. Examples you could talk about how that's pulling customers to standardize operations around pounds here. Thank you.

Speaker 2: Thank you. Well there are a lot of like a lot of the new deals we're working. So it's like if you look at the timeline of Palantir two years ago was all kind of.

Thank you well.

There are a lot of like a lot of the new deals were working so it's like if you look at the timeline of how inter.

Two years ago, with all kind of three years ago. It was like analytics and operations and what you see now is kind of people building off of what wanting a standardized product is version of what we did at Airbus What we've done internally at BP.

Speaker 2: three years ago, it was like analytics and operations. And what you see now is kind of people building off of what wanting a standardized, productized version of what we did at Airbus, what we've done internally at BP, what we did with Lilium, and...

What we what we did it with Lilly.

And.

Speaker 2: And so what I can tell you is like of the very big deals we're working on now They're almost all this it's like we used to have to educate people. They didn't believe us

And so what I can tell you is like of the very big deals. We're working on now they're almost all of this it's like we used to have to educate people they didn't believe us.

And you know it's interesting I do think it's like obviously there was also just a COVID-19 distribution thing I mean koby distribution in England, England is not one health care system at 600 hospitals that our countries.

Speaker 2: And you know, it's interesting, I do think it's like, obviously, there was also just the COVID distribution thing. I mean, COVID distribution in England, England is not one health care system, it's 600 hospitals that are country.

Speaker 2: It's like 600 countries and this is true. And so just seeing this happen or networks of people hearing this happen is the reason why you have 80% organic growth in the US ex-spax.

It's like 600 countries.

And this is true and so and so just seeing this happen or networks that people hearing. This happened is is the reason why you have 80% organic growth in the U S ex spak.

Speaker 2: and with almost no salespeople. It's because people are now like, okay, now the caveat here is this is not for everybody. So there's like not everybody wants, where this is particularly valuable is you have a business that is not protected by a moat that has, but has real insights on how to do something and wants to take over their industry.

And with almost no salespeople, it's because people are now like okay. Now the caveat here is this is not for everybody. So there's like not everybody wants to where this is particularly valuable as you have a business that is not protected.

By a moat is.

That has to but has real insights on how to do something and wants to take over their industry. So it's like you're sitting there you have a product that is maybe the best in the world maybe the second best in the world, but it's it's not protected but you do have insight to their favorite software you could take over your market and that's where we're seeing the thing Thats really changed.

Speaker 2: So it's like you're sitting there, you have a product that is maybe the best in the world, maybe the second best in the world, but it's not protected. But you do have insights that are in the software you could take over your market. And that's where we're seeing it. The thing that's really changed is for once...

<unk> is for once.

It's not me fighting my way into the person's office and then throwing me out.

Speaker 2: me fighting my way into the person's office and then throwing me out.

Speaker 2: It's them calling and saying, no, we know this can work. The pilot phases now are days.

It's them, calling and saying no. We know this can work.

The pilot phases now are are like.

Days.

Speaker 2: And then we're on and so like and we're working on two or three of these now

And then we're on to and so like and we're working on two or three of these now.

It's like it's just it's very very exciting the one thing I would say as a caveat though is.

Speaker 2: very, very exciting. The one thing I would say as a caveat, though, is it's a little bit, we are both working on this and working on modularization with equal force, because they're just not the same thing. Somebody who wants this is not buying modular pound here. They want the whole Foundry thing. And what they want is what they want help with is like, well, how would we identify people to hire to write to your platform? That's actually a big new question.

It's a little bit we are both working on this and working on modulus nation with equal force because they're just not the same thing somebody who wants this is not buying modular powered here they want the whole foundry thing and what they want what they want help with is like well how.

How would we identify people to hire to write to your platform. That's actually a big new question like where can we find people. They don't have to be power into your quality software engineers.

Speaker 2: Where can we find people? They don't have to be talented quality software engineers. Those are just too rare. But what we're doing with our platform is making it so that just smart people can actually write to it. And so that logic can be multiplied as much crisis African origin. I mean, like I said at the beginning where you have bore enough people and some Latinx of them are open to everyone on zoom or ofcomparable Superscripts that can be actually used as emails

Just two rare, but what we're doing with our platform is making it so that just smart people can actually write to it.

And so that that that increases our Tam a lot because <unk>.

Speaker 2: smart and smart enough, or specialized smart, to write code at the level you write it here. Those are just completely different TAMs.

Smart and smart enough or specialized smart to write code at the level, you're right here, because they're just completely different tamps.

Thank you.

Thanks Mark.

Right.

One V.

Yeah. Thank you for taking my question and my question to you is in a recent interview science there than what AWS was <unk> foundry really will be for <unk>.

Speaker 2: Hey Alex, thank you for taking my question. My question to you is, in a recent interview, Shyam said that what AWS was for developers last decade, Foundry really will be for developers this year.

Can you expand on what clients volunteer has to make foundry available to a broader developer community again. Thank you for taking my question and thank you for allowing a retail investor like myself and have a seat at the table. It is much appreciated as a good notice.

Speaker 2: Can you expand on what Plance Palantir has to make Foundry available to a broader developer community? Again, thank you for taking my question and thank you for allowing a retail investor like myself to have a seat at the table. It's much appreciated.

I see myself as a retail investor.

Speaker 2: myself as a retail investor and I have all my assets in Palantir. So I'm very happy to meet another retail investor. Hope any case. So, you know, we've done these like founder for builders programs in America and in France and like, you know, it's not charity.

I have all my assets in pound here, so I'm very happy to meet another retail investor.

Any case.

Hum.

So you know we've done these like founder for builders programs in America, and in France, and like you know, it's not charity it's.

Speaker 2: It's because we want people in the tech community broadly to learn how to write to panelists. We also want to learn from them. So that's one very important program, not revenue based, but it's essentially...

It's because we want people in the tech community broadly to learn how to right right to pounds. We also want to learn from them and so that's one very important program not revenue base, but it's essentially very valuable for our tech development and very valuable to get technically literate people on balance here. So they can see what they can do and tell us what they can't do.

Speaker 2: very valuable for our tech development and very valuable to get technically literate people on Palantir so they can see what they can do and tell us what they can't do.

Speaker 2: Then there's the broader commercial. A lot of the companies we've supplied

Then there's the then there is the broader commercial.

Lot of the companies we've supplied.

Speaker 2: uh... and government it is used by the power to reflect uh... it they require an ability to write to foundry or to one of our products as like a core competence in the

And government agencies decide to pound here, it's like.

They require and ability to write to foundry or to one of our products as like a core competence and like so one of the things. We know so obviously figure out ways. How can we can train people, how we can make that experience easier how can we widen the aperture and by the way obviously not just because.

Speaker 2: So one of the things we know, so obviously figuring out ways how we can train people, how we can make that experience easier, how can we widen the aperture. And by the way, obviously not just because...

Speaker 2: You know, it's like, it's not just for the altruistic reasons that are obvious. It's like, if you want people who are valuable now to be valuable tomorrow, they must be able to interact with the software platform.

It's like it's not just for the altruistic reasons that are obvious is like if you want people who are valuable now to be valuable tomorrow, they must be able to interact with the software platform. So that's like one of the reasons, we've had a lot of adoption because if you take.

Speaker 2: So that's like one of the reasons we've had a lot of adoption because if you take a company like Chrysler Fiat, which has very talented people and they need to be able to write to the platform and then work with the platform. So we're working on that partly for political reasons and partly because obviously it's very good for you as an investor and palantir and we're proud of that.

Company like Chrysler, Fiat, which has very talented people in.

They need to be able to write to the platform and so that's and then work with the platform. So we're working on that partly for political reasons and partly because obviously, it's very good for you as an investor in pounds here and we're proud of that.

Great. Thanks, Ron.

Speaker 1: Great, thanks Juan. Our next question is from Phil Winslow with Credit Suisse. Phil, you'll receive a prompt to unmute your line and please ensure your video is on.

Our next question is from Phil Winslow with credit Suisse, Phil you'll receive a prompt on mute your line. Please ensure your videos on.

Great. Thanks for taking my question and I do appreciate the cohort data that you disclosed today that was very helpful.

Speaker 6: Thanks for taking my question. And I do appreciate the cohort data that you just listed today. That was very helpful. Just to dig in on that a little bit, Alex, you talked about starting to see inflection where Palantir is getting pulled into some of these commercial deals, sort of asking for Palantir without even knowing that that's what they needed. You see that in the cohort number on the commercial side in terms of the new for 2021. I'm curious if we can just dig into that a little bit. Are you seeing specific industries really start to have that aha moment to get it? Are there certain use cases that that they're leaning into and then just have one follow up to that?

Just to dig in on that a little bit you know Alex you talked about you're starting to see inflection where pound here is getting pulled into some of these commercial deals sort of asking for voluntary without even knowing it.

Thats.

That's what they needed you see that in the cohort number on the commercial side in terms of the new for 2021 I'm curious if we could just dig into that a little bit are you seeing specific industries really start to have that aha moment did it are there certain use cases.

They are leaning into it and then just have one follow up to that.

You know what makes parent tier foundry.

Speaker 2: You know what makes Palantir Foundry valuable is that it's it's not really industry dependent. And this is crucial for us because we are Salesforce's donation. So we're very dependent on where either there's a crisis.

<unk> is that it's not really industry dependent and this is crucial for us because we our sales forces. So nascent so we're very dependent on where either there is a crisis or aware again that the crisis or where somebody actually.

Speaker 2: or where again that crisis or where somebody actually

Speaker 2: wants to enter a market they're not in and wants to expand. So I would say in the past

Wants to enter a market there no they're not in and wants to expand so I would say in.

In the past we were very very dependent on manufacturing so like our high level engineering companies like BP and others.

Speaker 2: We were very, very dependent on manufacturing. So like our high level engineering companies, like BP and others.

Speaker 2: uh... because we defacto needed the engineering talent because no one else believe this the product was differentiated now it is much more standard businesses of all kinds

Does we de facto needed the engineering talent because no one else believed us the product was differentiated.

Now it is much more standard businesses of all kinds of all kinds and so just like really the who's who of American business.

Speaker 2: all kinds. And so just like really the who's who of American business from from like, you know, people building tractors to building cars to oil and gas to distribution. And there's no one kind of company where we do not do well is like, yeah, we're not going to sell to a marketing company.

From from like you know people building tractors to building cars to oil and gas to distribution.

And there's no one kind of company, where we do not do well is like yes, we're not going to sell to a marketing company.

Speaker 2: You know, it's like that we're not that we don't we don't bother talking to them. They don't call us. We're not good at marketing. Like they apparently are. They're so good at marketing. They don't have to quantify their results.

We're not we don't we don't buy there talking to them. They don't call us we're not good at marketing. They apparently are they're so good at marketing they don't have to quantify their results.

Speaker 2: We don't...

Well, we don't we don't.

Speaker 2: Yeah, so, by the way, one of the places, you know, Europe , one of the interesting ways to look at our business, by the way, since you're in Europe and since I have an affinity to your region, Liechtenstein, Zweigt.

Yeah, so by the way.

One of the places you know Europe is one of the interesting ways to look at our business by the way since you're in Europe , and since I have an affinity to your region.

Lesions nine sites.

Speaker 2: is that Europe ...

Is you know.

It's that Europe in general has like you know grew slower than that.

Speaker 2: in general has like, you know, grew slower and that's, you know, if you assume that comes back online, it's just going to be bombastic. One of the places that we're actually very strong in Europe is Switzerland. And there you have, like a lot of the pharmaceuticals, insurance companies,

If you assume that comes back online and it's just gonna be bombastic one of the places that we're actually very strong.

In Europe , as Switzerland, and there you have like a lot of the pharmaceuticals insurance companies.

Banks.

Speaker 2: that can't be mentioned using our products. And I think they use it honestly because it's like there's a Swiss quality to pound here. It's like a very high quality product. We deliver it. It will work. You're not going to get the charming slap on the back or the steak dinner and your software is going to fucking work.

Camp.

That can't be mentioned, using our products and and I think they use and honestly because its like theres, a Swiss quality of the talent here.

A very high quality product, we deliver it it will work you're not going to get the charming slap on the back or the steak dinner and yourself was gonna fucking work.

So.

Speaker 6: And then just to follow up on that specifically, because obviously the net retention numbers that you have in U.S. government, government in general is huge, U.S. commercial is huge. That's one thing I noticed with the disclosure of the net retention is non-U.S. commercial is significantly lower. What drives that and how do you sort of inflect that higher?

And then just a follow up on that specifically because obviously the net retention numbers that you have in the U S government government generous ugo's commercials years, that's the one thing I noticed is.

Their disclosures and that retention is not in U S. Commercial it was significantly lower.

What drives that and how do you sort of inflect inflect that higher.

Well you know.

Speaker 2: Well, you know, first of all, I do think there's a handoff function. And I think these things are actually repeating what happened in the earlier days in America when is like where you have a handoff built in government because you have more time to actually get it right.

First of all I do think Theres, a handoff function and I think these things are actually repeating what happened in the earlier days in America. When is like where you have a handoff.

Built in government, because you have more time to actually get it right.

Speaker 2: handoff to commercial go to Europe . I do think in general certain Swiss institutions, certain German institutions, certain French institutions, you know, not included, where it is slower. Like if you are building something very, very new, it will be adopted a little later. But then there's also just the COVID. You know, the reaction to COVID in continental Europe was different than in America. While it slowed things down in America, it didn't really stop.

I'll hand off to commercial go to Europe , I do think in general certain Swiss institution, certain German institutions certain French institutions.

No.

Not included where it is slower like if you are building something very very new it will be adopted a little later, but then there's also just the COVID-19 the reaction to Covid in Continental Europe was different than in America, while it slowed things down in America, It didn't really stop them.

Speaker 2: And and so I kind of what I suspect is going to happen is that Europe because of COVID-19 reopening and because of.

And so the I kind of what I suspect is going to happen is that Europe because of.

Covid reopening and because of basically people.

Speaker 2: copying what's happening in highly adaptive met america and sometimes in switzerland uh... you will see uh... the the the the the european cohort but again to just make it a little more quantitative we have uh... i think it a hundred fifty percent a net dollar retention in u.s. commercial

<unk>, what's happening in highly adaptive America, and sometimes in Switzerland.

You will see.

The the European cohort grow, but but again to just make it a little more quantitative we have.

I think 150% net dollar retention and newest commercial again, a number which we're getting with basically no one holding it out so I don't know how this works at other companies, but I think if you if I were a scientist I'd want to normalize that number but even non normalize. This is a very strong number what we're going to show is net dollar retention in the U.

Speaker 2: Again, a number which we're getting with basically no one holding it up. So I don't know how this works at other companies, but I think if I were a scientist, I'd want to normalize that number. But even non-normalized, this is a very strong number. What we're going to show is net dollar retention in the U.S. And over time, we're going to show how this expands outside the U.S.

And over time, we're going to show how this expands outside the U S.

Speaker 2: And that, I think what you'll begin to see is that this strength in the U.S. will go outside the U.S. and will make our business very, very robust.

And that that I think what youll begin to see is that the strength in the U S will go outside the U S and will make our business very very robust.

Got it alright, thanks for your time today I appreciate it.

Thanks, Phil So Alex we've taken we've received over a thousand questions from shareholders.

Speaker 1: Thanks, Phil. So Alex, we've received over a thousand questions from shareholders. Obviously, can't take them all. Are there any parting wisdom or parting thoughts that you want to offer about the business to our shareholders?

Obviously can't take them all are there any party wisdom or parting thoughts you want to offer about the business to our shareholders.

Speaker 2: You know, it's really tough times out there. Really tough for a lot of businesses. It should be known.

You know, it's it's really tough times out there.

Really tough for a lot of businesses. It's a lot of things are going wrong in the world in our world.

Speaker 2: A lot of things are going wrong in the world, in our world. The obvious danger, the lack of legitimacy of a lot of our institutions.

It you know the obvious danger.

The lack of legitimacy and a lot of our institutions.

Speaker 2: And I can tell you why while you know at Palantir we are very very focused on our business and bad times are very super motivational for us.

And I can tell you why wall.

At talent here, we are where we are very very focused on our business and bad times are very super motivational for us.

Speaker 2: and when we get to good times we'll be even stronger. And you know, we're a little bit of a wacky group of guerrilla warfighters, but we're very much in fighting mode.

And when we get to good times will be even stronger.

And you know, we're a little we're a little bit of a like wacky group of guerrilla war fighters, but we're very much in fighting mode.

Speaker 2: and not just for us and the West, but also for our shareholders.

And and not just for us.

In the west, but also for our shareholders.

Yeah, I hope to talk to you soon.

Thank you.