Palantir (PLTR) CEO Defends Company as Shares Post Worst Month Since 2023

Palantir's stock just logged its worst monthly performance since 2023. CEO Alex Karp isn't backing down.

The Defense Begins

Facing a brutal sell-off, Karp mounted a public defense of the data analytics firm's strategy and long-term vision. He pointed to the company's government contracts and expanding commercial business as pillars of resilience, arguing the market's reaction was disconnected from operational reality.

A Familiar Wall Street Story

The sell-off highlights the perennial tension between high-growth tech narratives and quarterly performance pressures. For every believer in Palantir's 'mission-critical' software, a skeptic questions its valuation and path to sustained profitability—a classic tech sector tug-of-war where hype often gets a reality check.

Looking Beyond the Noise

Karp's message focused on the horizon, not the rearview mirror. He emphasized Palantir's role in artificial intelligence infrastructure and large-scale data integration, suggesting current volatility is just noise for a company playing a decades-long game. Whether investors buy that story—or just the dip—remains to be seen. After all, on Wall Street, a 'long-term vision' is often just what executives talk about during a short-term rout.

TLDR

• Palantir (PLTR) stock dropped 16% in November, marking its worst monthly performance since August 2023
• Investors sold off AI stocks due to valuation concerns, with Palantir trading at 233 times forward earnings even after the decline
• Michael Burry, known for predicting the 2008 housing crisis, revealed a short position against Palantir and Nvidia
• CEO Alex Karp appeared on CNBC twice in one week to defend the company and called Burry’s actions “market manipulation”
• Despite deal wins with PwC and FTAI, multiple analysts including Jefferies and Deutsche Bank criticized Palantir’s “extreme” valuation

Palantir Technologies watched its stock tumble 16% throughout November. The monthly decline marked the company’s worst performance since August 2023.

Palantir Technologies Inc., PLTR

The data analytics provider got caught in a broader selloff of AI stocks. Investors dumped shares across the sector due to valuation fears and concerns about a potential bubble.

The month started promisingly for Palantir. The company beat Wall Street’s third-quarter earnings and revenue estimates. It also recorded its second consecutive quarter with revenue exceeding $1 billion.

But the good news didn’t last. Multiple analyst firms raised red flags about the company’s valuation.

Jefferies analysts labeled Palantir’s price levels as “extreme.” They suggested investors would find better opportunities in AI stocks like Microsoft and Snowflake. RBC Capital Markets expressed concerns about the company’s “increasingly concentrated growth profile.”

Deutsche Bank analysts said the valuation was “very difficult to wrap our heads around.” Even after November’s drop, Palantir trades at 233 times forward earnings. For comparison, Nvidia trades at about 38 times and Alphabet at roughly 30 times.

Short Seller Targets Palantir

The selloff intensified when Michael Burry disclosed a short position against Palantir. Burry gained fame for correctly predicting the 2008 housing crisis, documented in “The Big Short” film.

He also bet against AI chipmaker Nvidia. Burry later accused hyperscalers of artificially inflating earnings.

CEO Alex Karp didn’t take the criticism quietly. He appeared on CNBC twice within one week to defend the company. Karp accused Burry of “market manipulation” and called his actions “egregious.”

“The idea that chips and ontology is what you want to short is bats— crazy,” Karp told CNBC’s “Squawk Box.” He argued in a shareholder letter that Palantir offers everyday investors returns once “limited to the most successful venture capitalists in Palo Alto.”

During an earnings call, Karp told investors to watch his critics on television. “Please turn on the conventional television and see how unhappy those that didn’t invest in us are,” he said. “Enjoy, get some popcorn. They’re crying.”

AI Stocks Face Broad Pressure

Palantir wasn’t alone in November’s tech rout. The entire AI sector experienced selling pressure.

Nvidia fell more than 12% during the month. Microsoft and Amazon each dropped about 5%. Quantum computing stocks like Rigetti Computing and D-Wave Quantum lost over a third of their value.

Only Apple and Alphabet managed to finish November with gains among the Magnificent 7 stocks.

Palantir did secure some business wins during the month. The company signed a multiyear contract with consulting firm PwC to accelerate AI adoption in the U.K. It also closed a deal with aircraft engine maintenance company FTAI.