Short write up about palantir's coo in discussing both government and commercial division opportunity

Government Division :

Questions were fielded from investors as to the sluggishness of the government division performance.

Note: government growth shows sequential slowdown in 2021

Q1: 76%

Q2: 66%

Q3: 34%

Q4: 26%

The response was that US government is operating under a continuing resolution.

This means that current programs are operating under last year’s funding.

As such, new programs/ project starts have been unable to begin.

A bipartisan agreement in Congress has settled on $782.5B national defense budget. 

Of this: 

~$119 billion in R&D, test & evaluation funding

~$145 billion for procurement

Palantir believe there will be a meaningful pick up in spending weighted toward the latter part of 2022, once the US defence budget is passed. 

Commercial Division:

- US Commercial net recurring revenue is ~150% and makes up 13% of total revenues or 31% of commercial division.

- Growth was triple digit in US commercial in 2021

- International commercial net recurring revenue 103%, but management expect this to improve as ramp up in international sales team becomes more efficient

- palantir increased sales reps by 12 full time equivalents in 2021, where total US sales full time equivalents is 80

Intention is to continue to expand sales team both in US & internationally (mainly Europe) to cater to the shorter cycle commercial division

Management discussed the modularisation of their product suite.

Instead of selling one large platform to customers where some functionality is not fully utilised by customers, palantir has modularised products and functions within the Foundry platform.

Management believes the benefits to this are largely two fold:

- Speedier installation and modularised products up and running faster for customers.

- It facilitates a land and expand sales strategy, where customers who otherwise may not have signed up to the holistic platform now are signing up for various modularised products. In time there is potential for these customers to be cross-sold and up-sold added functionalities.

On pricing, Palantir now offers a per usage based model, in addition to their “all you can eat” pricing model

Finally on future ambitions…

Palantir unique selling point is it’s data integration engine. 

However longterm ambitions lie in building an application platform to build applications on top of these converged data sets, & not only just providing storage and compute.