To The Moon

Why I Continue to Hold Palantir (PLTR) With Conviction – Strong Earnings Can Help Stabilise Future Pullbacks

latest earnings report once again reminded me why Palantir remains one of my highest conviction holdings. After reporting another outstanding quarter, the stock surged more than 14% in after-hours trading. Revenue reached approximately US$1.94 billion, growing by more than 90% year over year, while adjusted earnings per share exceeded expectations. Commercial revenue also accelerated sharply, showing that demand is no longer coming only from government contracts but increasingly from private enterprises embracing artificial intelligence.

Despite the sharp rally, my conviction has not changed. In fact, it has become even stronger.

🚀 My Investment Thesis Has Always Been About Earnings

I have never bought Palantir simply because everyone was talking about AI.

Instead, my investment thesis has always been straightforward:

As long as earnings continue growing faster than expectations, eventually the company’s fundamentals will justify a much higher valuation.

Many investors spend too much time debating whether PLTR is “expensive.”

I spend more time asking:

“Can management continue growing earnings at a rate few companies can match?”

So far, the answer has been yes.

Quarter after quarter, management has continued to surprise Wall Street.

That gives me confidence that the business itself is becoming stronger rather than weaker.

📈 Great Companies Usually Look Expensive

History has shown that many of the world’s best-performing companies rarely looked cheap.

Amazon looked expensive.

NVIDIA looked expensive.

Tesla looked expensive.

Even Apple was considered expensive during various periods.

Yet investors who focused only on valuation often missed years of compounding earnings growth.

Palantir may be following a similar path.

When earnings compound rapidly, today’s valuation can look much more reasonable several years later.

💼 Management Continues To Execute

One reason my conviction remains high is management execution.

Building AI software is difficult.

Building AI software that governments trust is even harder.

Building AI software that Fortune 500 companies continue expanding every quarter is even harder.

Palantir has managed all three.

Instead of relying on hype, management consistently delivers:

* Higher revenue

* Better margins

* More cash flow

* More commercial customers

* Larger existing customer spending

These are exactly the metrics I want to see.

🤖 AI Adoption Is Still Early

Many people think the AI boom is already over because AI stocks have rallied.

I disagree.

We are still in the early innings.

Thousands of companies worldwide are only beginning to deploy AI into their operations.

Many are still experimenting.

Others have yet to decide on long-term partners.

Palantir’s Artificial Intelligence Platform (AIP) is increasingly becoming one of those strategic platforms.

If enterprise AI spending continues growing over the next five to ten years, Palantir could remain one of the major beneficiaries.

💰 Strong Earnings Help Stabilise Pullbacks

No stock moves up in a straight line.

Even great companies experience corrections.

Palantir could easily experience pullbacks of 10%, 20%, or even more after strong rallies.

However, what gives me confidence is that every successful earnings report changes the fundamental value of the business.

If revenue, earnings, and cash flow continue increasing, each quarter provides a stronger foundation beneath the share price.

Instead of relying purely on market sentiment, the company is gradually building intrinsic value.

Over time, improving fundamentals can attract long-term investors who are willing to buy during periods of weakness.

That doesn’t guarantee the stock won’t fall, but stronger earnings can help support confidence when volatility appears.

🐻 Even Bears Are Reducing Positions

One interesting point from recent market discussions is that some well-known bearish investors have reportedly reduced portions of their short positions.

Meanwhile, respected value investors like Duan Yongping have been associated with using cash-secured put strategies to potentially build exposure at prices they find attractive.

This tells me something important.

Different investors may disagree on valuation, but many are managing risk rather than making all-or-nothing bets.

Markets are rarely black and white.

Even experienced investors adjust positions as new information becomes available.

📊 Volatility Is Normal

Many investors panic whenever Palantir falls 5% or 10%.

I don’t.

High-growth companies naturally experience larger price swings.

When expectations are high, volatility comes with the territory.

Instead of focusing on daily price movements, I prefer watching:

* Revenue growth

* Operating margins

* Customer additions

* Free cash flow

* Commercial expansion

* AI platform adoption

If these continue improving, temporary price swings matter less to my long-term thesis.

💵 Why I Continue Holding My Position

Looking at my portfolio, Palantir has generated significant realised gains while the remaining position naturally experiences unrealised fluctuations as the stock moves.

That is simply part of investing.

For me, selling too early has often been a bigger mistake than sitting through normal volatility.

As long as the original investment thesis remains intact, I prefer allowing winners to continue compounding.

Sometimes the hardest part of investing is simply holding on while the company keeps executing.

⚠️ Risks Still Exist

Although I remain bullish, I also recognise the risks.

Palantir still trades at a premium valuation compared with many software companies.

If earnings growth slows materially or customers delay AI spending, the stock could face pressure.

Competition in enterprise AI is also intense, with large technology companies investing heavily.

For these reasons, I continue to monitor every quarterly earnings report rather than assuming future success is guaranteed.

🎯 My Long-Term Conviction

My conviction in Palantir is not based on excitement around AI headlines.

It is based on consistent execution.

Every quarter, management has shown an ability to grow revenue, expand commercial adoption, improve profitability, and generate meaningful cash flow.

If this continues over the next several years, I believe today’s earnings growth can continue supporting the company’s long-term value.

Will the stock experience corrections?

Almost certainly.

Will there be periods when investors question the valuation?

Absolutely.

But if management continues delivering strong earnings and demonstrating disciplined execution, those fundamentals can provide a stronger base over time than hype alone.

That is why I remain invested.

I am not trying to predict where Palantir will trade next week or next month. Instead, I am focused on whether the business can continue compounding earnings over the coming years. If management keeps executing at the current pace, I believe the long-term opportunity remains compelling, even if the journey includes periods of significant volatility.

This article reflects my personal investment opinion and is not financial advice. All investments involve risk, and investors should conduct their own research and ensure any investment fits their financial goals and risk tolerance.

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