Shares of Palantir Technologies (PLTR 0.80%) have had an incredible run. Since bottoming out along with the broader market in late 2022, the stock price has soared 2,800% and is trading at high multiples of sales and earnings.
One reason investors continue to bid up the share price, and why the stock could deliver more upside, is that the company's addressable market is still expanding. New opportunities are emerging that could further accelerate revenue growth and push the stock higher.
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New opportunities could fuel accelerating growth
Palantir's revenue growth has accelerated over the last year, and management is guiding for 50% year-over-year growth in the third quarter, up from 48% in the second quarter. Its flagship Artificial Intelligence Platform (AIP) is used as an AI operating system that helps customers build AI agents for fast decision-making. AIP, which was launched in 2023, is driving tremendous demand, with U.S. commercial revenue up 93% year over year last quarter.
But Palantir has deep ties solving problems for the U.S. military, and this is still a major source of business. For example, Palantir said in the last earnings call that it sees a big opportunity unfolding for its Warp Speed manufacturing operating system as the U.S. focuses on shipbuilding.
Companies are also transitioning away from generic AI tools offered by leading hyperscalers to AIP for building software. Palantir is solving complicated problems for businesses and the military, and its growing profits are only going to fuel more innovation in its AI capabilities that expand its addressable market.
