Palantir Shares Surge as AI Software Sentiment Shifts

Palantir Technologies shares rose as much as 9.9% on Friday, driven by a shift in investor sentiment toward software stocks. The surge follows a broader trend where several enterprise software companies, including Twilio, reported better-than-expected financial results, easing fears that artificial intelligence would automate away the software-as-a-service business model.

This momentum follows a second-quarter report from Palantir on Tuesday, which showed record year-over-year revenue growth of 93% to $1.94 billion. The company also reported a 156% increase in adjusted earnings per share to $0.41.

While the stock maintains a high valuation at 74 times next year's expected earnings, investors are increasingly viewing triple-digit profit growth as justification for the premium.