What changed in this filing

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Item 1. Financial Statements

2023-05-09 compared with 2022-11-07 · 225 added, 210 removed, 360 unchanged (55% of the section changed)

3 unchanged sentences

(in thousands, except per share amounts)

As of September 30, As of December 31,

As of March 31, 2023 As of December 31, 2022

Current assets:

Cash and cash equivalents $ 1,264,738 $ 2,598,540

Restricted cash 20,557 36,628

Accounts receivable, net 343,264 190,923

Marketable securities 1,639,797 35,135

Accounts receivable, net 254,041 258,346

Restricted cash 11,946 16,244

Prepaid expenses and other current assets 85,625 133,312

21 unchanged sentences

Common stock, $ 0.001 par value:

20,000,000 Class A shares authorized as of September 30, 2022 and December 31, 2021;

1,978,797 and 1,926,589 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively;

2,700,000 Class B shares authorized as of September 30, 2022 and December 31, 2021;

99,862 and 99,880 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively;

and 1,005 Class F shares authorized, issued, and outstanding as of September 30, 2022 and December 31, 2021

20,000,000 Class A shares authorized as of March 31, 2023 and December 31, 2022;

2,013,044 and 1,995,414 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively;

2,700,000 Class B shares authorized as of March 31, 2023 and December 31, 2022;

103,681 and 102,656 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively;

and 1,005 Class F shares authorized, issued, and outstanding as of March 31, 2023 and December 31, 2022

Additional paid-in capital 8,568,570 8,427,998

Accumulated other comprehensive loss ( 9,835 ) ( 2,349 )

Accumulated other comprehensive loss, net ( 4,318 ) ( 5,333 )

Accumulated deficit ( 5,842,636 ) ( 5,859,438 )

Total stockholders’ equity 2,723,733 2,565,326

Total liabilities and stockholders’ equity $ 3,318,835 $ 3,247,450

Noncontrolling interests 79,460 77,111

Total equity 2,803,193 2,642,437

Total liabilities and equity $ 3,683,138 $ 3,461,239

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(in thousands, except per share amounts)

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Three Months Ended March 31,

Revenue $ 525,186 $ 446,357

6 unchanged sentences

Total operating expenses 413,426 391,393

Loss from operations ( 62,191 ) ( 91,941 ) ( 143,375 ) ( 352,103 )

Income (loss) from operations 4,115 ( 39,439 )

Interest income 20,853 547

1 unchanged sentence

Other income (expense), net ( 2,861 ) ( 59,870 )

Loss before provision for (benefit from) income taxes ( 122,779 ) ( 100,699 ) ( 398,876 ) ( 365,312 )

Provision for (benefit from) income taxes 1,096 1,438 5,707 ( 1,121 )

Net loss $ ( 123,875 ) $ ( 102,137 ) $ ( 404,583 ) $ ( 364,191 )

Net loss per share attributable to common stockholders, basic $ ( 0.06 ) $ ( 0.05 ) $ ( 0.20 ) $ ( 0.19 )

Net loss per share attributable to common stockholders, diluted $ ( 0.06 ) $ ( 0.05 ) $ ( 0.20 ) $ ( 0.19 )

Weighted-average shares of common stock outstanding used in computing net loss per share attributable to common stockholders, basic 2,073,265 1,964,395 2,054,926 1,893,911

Weighted-average shares of common stock outstanding used in computing net loss per share attributable to common stockholders, diluted 2,073,265 1,964,395 2,054,926 1,893,911

Income (loss) before provision for income taxes 20,832 ( 99,356 )

Provision for income taxes 1,681 2,023

Net income (loss) 19,151 ( 101,379 )

Net income attributable to noncontrolling interests 2,349 —

Net income (loss) attributable to common stockholders $ 16,802 $ ( 101,379 )

Net earnings (loss) per share attributable to common stockholders, basic $ 0.01 $ ( 0.05 )

Net earnings (loss) per share attributable to common stockholders, diluted $ 0.01 $ ( 0.05 )

Weighted-average shares of common stock outstanding used in computing net earnings (loss) per share attributable to common stockholders, basic 2,107,780 2,036,307

Weighted-average shares of common stock outstanding used in computing net earnings (loss) per share attributable to common stockholders, diluted 2,217,439 2,036,307

The accompanying notes are an integral part of these condensed consolidated financial statements.

Palantir Technologies Inc.

Condensed Consolidated Statements of Comprehensive Loss

Condensed Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Net loss $ ( 123,875 ) $ ( 102,137 ) $ ( 404,583 ) $ ( 364,191 )

Three Months Ended March 31,

Net income (loss) $ 19,151 $ ( 101,379 )

Other comprehensive income (loss)

Foreign currency translation adjustments 1,015 ( 1,695 )

Comprehensive loss $ ( 127,036 ) $ ( 103,897 ) $ ( 412,069 ) $ ( 363,141 )

Net unrealized gain on available-for-sale securities 285 —

Comprehensive income (loss) 20,451 ( 103,074 )

Comprehensive income attributable to noncontrolling interests 2,349 —

Comprehensive income (loss) attributable to common stockholders $ 18,102 $ ( 103,074 )

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Stockholders’ Equity

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss, Net Accumulated Deficit Total Stockholders’ Equity Noncontrolling Interests Total Equity

Shares Amount

Balance as of June 30, 2022 2,062,741 $ 2,063 $ 8,119,876 $ ( 6,674 ) $ ( 5,766,441 ) $ 2,348,824

Balance as of December 31, 2022 2,099,075 $ 2,099 $ 8,427,998 $ ( 5,333 ) $ ( 5,859,438 ) $ 2,565,326 $ 77,111 $ 2,642,437

Issuance of common stock from the exercise of stock options 5,381 5 25,919 — — 25,924 — 25,924

1 unchanged sentence

Stock-based compensation — — 114,666 — — 114,666 — 114,666

Other comprehensive loss — — — ( 3,161 ) — ( 3,161 )

Net loss — — — — ( 123,875 ) ( 123,875 )

Balance as of September 30, 2022 2,079,664 $ 2,080 $ 8,284,686 $ ( 9,835 ) $ ( 5,890,316 ) $ 2,386,615

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Stockholders’ Equity

Other comprehensive income — — — 1,015 — 1,015 — 1,015

Net income — — — — 16,802 16,802 2,349 19,151

Balance as of March 31, 2023 2,117,730 $ 2,117 $ 8,568,570 $ ( 4,318 ) $ ( 5,842,636 ) $ 2,723,733 $ 79,460 $ 2,803,193

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss, Net Accumulated Deficit Total Stockholders’ Equity

Shares Amount

5 unchanged sentences

Net loss — — — — ( 101,379 ) ( 101,379 )

Balance as of September 30, 2022 2,079,664 $ 2,080 $ 8,284,686 $ ( 9,835 ) $ ( 5,890,316 ) $ 2,386,615

Palantir Technologies Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands)

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Stockholders’ Equity

Shares Amount

Balance as of June 30, 2021 1,936,578 $ 1,937 $ 7,294,369 $ 65 $ ( 5,227,408 ) $ 2,068,963

Issuance of common stock from the exercise of stock options 41,249 41 97,954 — — 97,995

Issuance of common stock upon vesting of RSUs 13,291 13 ( 13 ) — — —

Stock-based compensation — — 184,995 — — 184,995

Other comprehensive loss — — — ( 1,760 ) — ( 1,760 )

Net loss — — — — ( 102,137 ) ( 102,137 )

Balance as of September 30, 2021 1,991,118 $ 1,991 $ 7,577,305 $ ( 1,695 ) $ ( 5,329,545 ) $ 2,248,056

Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Stockholders’ Equity

Shares Amount

Balance as of December 31, 2020 1,792,140 $ 1,792 $ 6,488,857 $ ( 2,745 ) $ ( 4,965,354 ) $ 1,522,550

Issuance of common stock from the exercise of stock options 155,720 155 474,528 — — 474,683

Issuance of common stock upon vesting of RSUs 37,123 37 ( 37 ) — — —

Issuance of common stock upon vesting of growth units 1,471 1 ( 1 ) — — —

Issuance of common stock upon net exercise of common stock warrants and other 4,664 6 1,706 — — 1,712

Stock-based compensation — — 612,252 — — 612,252

Other comprehensive income — — — 1,050 — 1,050

Net loss — — — — ( 364,191 ) ( 364,191 )

Balance as of September 30, 2021 1,991,118 $ 1,991 $ 7,577,305 $ ( 1,695 ) $ ( 5,329,545 ) $ 2,248,056

Balance as of March 31, 2022 2,045,876 $ 2,046 $ 7,953,856 $ ( 4,044 ) $ ( 5,587,112 ) $ 2,364,746

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

Operating activities

Net loss $ ( 404,583 ) $ ( 364,191 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Net income (loss) $ 19,151 $ ( 101,379 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization 8,320 4,312

Stock-based compensation 114,714 149,323

Deferred income taxes ( 31 ) 337

Non-cash operating lease expense 30,130 23,417

Noncash operating lease expense 10,836 10,142

Unrealized and realized (gain) loss from marketable securities, net 8,508 62,843

1 unchanged sentence

Changes in operating assets and liabilities:

Accounts receivable ( 154,591 ) ( 15,412 )

Accounts receivable, net ( 628 ) ( 65,867 )

Prepaid expenses and other current assets 1,973 ( 4,320 )

10 unchanged sentences

Purchases of marketable securities ( 2,310,367 ) ( 89,500 )

Proceeds from sales of marketable securities 36,482 —

Proceeds from redemption of marketable securities 4,619 —

Purchases of alternative investments — ( 50,941 )

Other investing activities — ( 3,000 )

Proceeds from sales and redemption of marketable securities 709,459 8,247

Proceeds from sales of alternative investments 51,072 —

Net cash used in investing activities ( 1,554,591 ) ( 96,468 )

Financing activities

Principal payments on borrowings — ( 200,000 )

Proceeds from the exercise of common stock options 25,924 27,225

2 unchanged sentences

Effect of foreign exchange on cash, cash equivalents, and restricted cash 2,676 ( 727 )

Net increase in cash, cash equivalents, and restricted cash 85,835 295,029

Net decrease in cash, cash equivalents, and restricted cash ( 1,338,556 ) ( 34,477 )

Cash, cash equivalents, and restricted cash - beginning of period 2,627,335 2,366,914

17 unchanged sentences

Certain prior year balances have been reclassified to conform to the current year presentation.

Such reclassifications did not affect total revenues, loss from operations, net loss, or cash flows.

Such reclassifications did not affect total revenues, income (loss) from operations, net income (loss), or cash flows.

The Company's fiscal year ends on December 31.

The unaudited condensed consolidated balance sheet as of December 31, 2022 included herein was derived from the audited consolidated financial statements as of that date, but does not include all disclosures, including certain notes required by GAAP on an annual reporting basis.

In management’s opinion, the unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the balance sheets and statements of operations, comprehensive loss, stockholders’ equity, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full fiscal year or any future period.

In management’s opinion, the unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the balance sheets and statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full fiscal year or any future period.

These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes included in its Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 21, 2023.

4 unchanged sentences

the collectability of contract consideration, including accounts receivable;

the useful lives of tangible assets;

the useful lives of tangible and intangible assets;

the valuation of assets acquired and liabilities assumed from business combinations, including intangible assets and goodwill;

and the incremental borrowing rate for operating leases.

4 unchanged sentences

Significant Accounting Policies in the notes to consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 21, 2023.

There have been no significant changes to these policies during the nine months ended September 30, 2022.

There have been no significant changes to these policies during the three months ended March 31, 2023, except for the changes noted below.

Cash, Cash Equivalents, and Restricted Cash

The Company considers all highly liquid investments purchased with an original maturity of three months or less at the time of purchase to be cash equivalents.

Cash equivalents primarily consist of amounts invested in money market funds.

Restricted cash primarily consists of cash and certificates of deposit that are held as collateral against letters of credit and guarantees that the Company is required to maintain for operating lease agreements, certain customer contracts, and other guarantees and financing arrangements.

Cash equivalents primarily consist of amounts invested in money market funds and available-for-sale debt securities.

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the amounts shown in the condensed consolidated statements of cash flows (in thousands):

As of September 30,

As of March 31,

Cash and cash equivalents $ 1,264,738 $ 2,269,411

7 unchanged sentences

Accounts receivable are written-off and charged against an allowance for credit losses when the Company has exhausted collection efforts without success.

Based upon the Company’s assessment as of September 30, 2022 and December 31, 2021, the allowances for credit losses were not material.

Concentrations of Risk

Based upon the Company’s assessment as of March 31, 2023 and December 31, 2022, the Company recorded an allowance for credit losses of $ 11.3 million and $ 10.1 million, respectively.

Debt Securities

Debt securities are primarily comprised of U.S.

treasury securities.

The debt securities are classified as available-for-sale at the time of purchase and are reevaluated as of each balance sheet date.

The Company considers the majority of its available-for-sale debt securities as available for use in current operations and may sell these securities at any time, and therefore classifies these securities as current assets in its condensed consolidated balance sheets.

Debt securities included in marketable securities on the condensed consolidated balance sheets consist of U.S.

treasury securities with original maturities of greater than three months at the time of purchase, and the remaining U.S.

treasury securities are included in cash and cash equivalents.

Interest income on debt securities classified as available-for-sale is included in other income (expense), net on the condensed consolidated statements of operations.

Non-marketable debt securities are recorded at their estimated fair value in other assets with changes in fair value recorded through accumulated other comprehensive loss, net on the condensed consolidated balance sheets.

The majority of the Company’s available-for-sale securities are recorded at fair value each reporting period using quoted prices of similar instruments and are classified within Level 2 of the fair value hierarchy.

The Company evaluates investments with unrealized loss positions for other than temporary impairment by assessing if they are related to deterioration in credit risk and whether it expects to recover the entire amortized cost basis of the security, the Company’s intent to sell, and whether it is more likely than not that the Company will be required to sell the securities before the recovery of their cost basis.

Credit-related impairment losses, not to exceed the amount that fair value is less than the amortized cost basis, are recognized in other income (expense), net in the condensed consolidated statements of operations.

Unrealized gains and non-credit related losses are reported as a separate component of accumulated other comprehensive loss, net in the condensed consolidated balance sheets until realized.

Realized gains and losses and declines in value judged to be other than temporary are determined based on the specific identification method and are reported in other income (expense), net in the condensed consolidated statements of operations.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents, restricted cash, accounts receivable, and marketable securities.

Cash equivalents primarily consist of money market funds with original maturities of three months or less, which are invested primarily with U.S.

Cash equivalents primarily consist of money market funds and U.S.

treasury securities with original maturities of three months or less, which are invested primarily with U.S.

financial institutions.

1 unchanged sentence

Management believes minimal credit risk exists with respect to these financial institutions and the Company has not experienced any losses on such amounts.

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company is exposed to concentrations of credit risk with respect to accounts receivable presented on the condensed consolidated balance sheets.

The Company’s accounts receivable balances as of September 30, 2022 and December 31, 2021 were $ 343.3 million and $ 190.9 million, respectively.

Customers J and I represented 17 % and 13 % of total accounts receivable as of September 30, 2022.

No other single customer represented more than 10% of total accounts receivable as of September 30, 2022 or December 31, 2021.

For the three and nine months ended September 30, 2022 and 2021, no customer represented more than 10% of total revenue.

The Company’s accounts receivable balances as of March 31, 2023 and December 31, 2022 were $ 254.0 million and $ 258.3 million, respectively.

Customer I represented 13 % of total accounts receivable as of March 31, 2023 and no other customers represented more than 10% of total accounts receivable as of March 31, 2023.

No customer represented more than 10% of total accounts receivable as of December 31, 2022.

For the three months ended March 31, 2023, Customer K, which is in the government operating segment, represented 10 % of total revenue and no other customers represented more than 10% of total revenue for the same period.

For the three months ended March 31, 2022, no customer represented 10% or more of total revenue.

Contract Liabilities and Remaining Performance Obligations

1 unchanged sentence

The Company’s contract liabilities consist of deferred revenue and customer deposits.

As of September 30, 2022 and December 31, 2021, the Company's contract liability balances were $ 460.8 million and $ 463.3 million, respectively.

Revenue of $ 353.8 million and $ 347.7 million was recognized during the nine months ended September 30, 2022 and 2021, respectively, that was included in the contract liability balances as of December 31, 2021 and 2020, respectively.

As of March 31, 2023 and December 31, 2022 the Company's contract liability balances were $ 427.9 million and $ 339.2 million, respectively.

Revenue of $ 192.4 million and $ 187.0 million was recognized during the three months ended March 31, 2023 and 2022, respectively, that was included in the contract liability balances as of December 31, 2022 and 2021, respectively.

Remaining Performance Obligations

4 unchanged sentences

Cancelable contracted revenue, which includes customer deposits, is not considered a remaining performance obligation.

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company’s remaining performance obligations were $ 1.3 billion as of September 30, 2022, of which the Company expects to recognize approximately 44 % as revenue over the next 12 months, 42 % as revenue over the subsequent 13 to 36 months, and the remainder thereafter.

The Company’s remaining performance obligations were $ 936.0 million as of March 31, 2023, of which the Company expects to recognize approximately 57 % as revenue over the next 12 months, 36 % as revenue over the subsequent 13 to 36 months, and the remainder thereafter.

Disaggregation of Revenue

2 unchanged sentences

The following tables present the Company’s assets that are measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation (in thousands):

As of September 30, 2022

As of March 31, 2023

Total Level 1 Level 2 Level 3

1 unchanged sentence

Money market funds $ 467,469 $ 467,469 $ — $ —

treasury securities 199,304 — 199,304 —

Certificates of deposit 6,174 — 6,174 —

2 unchanged sentences

Marketable securities:

Marketable securities 57,342 57,342 — —

treasury securities 1,623,212 — 1,623,212 —

Publicly-traded equity securities 16,585 16,585 — —

Total $ 2,327,102 $ 484,054 $ 1,843,048 $ —

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

As of December 31, 2022

6 unchanged sentences

Marketable securities:

Marketable securities 234,153 234,153 — —

Publicly-traded equity securities 35,135 35,135 — —

Total $ 1,209,935 $ 1,184,437 $ 25,498 $ —

Certificates of Deposit

The Company’s Level 2 instruments consist of restricted cash invested in certificates of deposit.

The Company’s certificates of deposit are Level 2 instruments.

The fair value of such instruments is estimated based on valuations obtained from third-party pricing services that utilize industry standard valuation models, including both income-based and market-based approaches, for which all significant inputs are observable either directly or indirectly.

These inputs include interest rate curves, foreign exchange rates, and credit ratings.

Marketable Securities

Marketable securities consist of equity securities in publicly-traded companies and are recorded at fair market value each reporting period.

Debt Securities

As of March 31, 2023, debt securities consisted of the following (in thousands):

As of March 31, 2023

Amortized Cost Unrealized Gains Unrealized Losses Fair Value

treasury securities $ 1,822,231 $ 304 $ ( 19 ) $ 1,822,516

Total debt securities $ 1,822,231 $ 304 $ ( 19 ) $ 1,822,516

Included in cash and cash equivalents $ 199,260 $ 44 $ — $ 199,304

Included in marketable securities $ 1,622,971 $ 260 $ ( 19 ) $ 1,623,212

The Company sold $ 694.6 million of debt securities during the three months ended March 31, 2023 and immediately reinvested such proceeds into additional debt securities.

The realized gains and losses from those sales were immaterial.

No credit or non-credit losses related to debt securities were recorded as of March 31, 2023.

Available-for-sale debt securities of $ 369.8 million were in an unrealized loss position primarily due to unfavorable changes in interest rates subsequent to initial purchase.

None of the available-for-sale debt securities held as of March 31, 2023 were in a continuous unrealized loss position for greater than 12 months.

The decline in fair value below amortized cost basis was not considered other than temporary as it is more likely than not that the Company will hold the securities until maturity or a recovery of the cost basis, and no credit-related impairment losses were recorded as of March 31, 2023.

All of the Company’s U.S.

treasury securities had contractual maturities due within one year.

As of December 31, 2022, the Company held an immaterial amount of debt securities.

Equity Securities

Equity securities primarily consist of shares held in publicly-traded companies, which are recorded at fair market value each reporting period in marketable securities on the condensed consolidated balance sheets.

Additionally, we have accepted, and may continue to accept, securities as noncash compensation.

Realized and unrealized gains and losses are recorded in other income (expense), net on the condensed consolidated statements of operations.

During the three and nine months ended September 30, 2022, the Company recorded net unrealized losses of $ 18.0 million and $ 192.8 million, respectively, and realized losses of $ 41.3 million and $ 67.9 million, respectively, within other income (expense), net on the condensed consolidated statements of operations.

During the three and nine months ended September 30, 2021, the Company recorded net unrealized losses of $ 7.2 million and no realized losses within other income (expense), net on the condensed consolidated statements of operations.

During the three months ended March 31, 2022, the Company recorded net unrealized losses of $ 51.9 million and realized losses of $ 10.9 million within other income (expense), net on the condensed consolidated statements of operations.

For the three months ended March 31, 2023 and 2022, net unrealized losses from publicly-traded equity securities held at the end of each period were $ 8.2 million and $ 58.4 million, respectively.

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Since 2021, the Company has approved and entered into certain agreements (“Investment Agreements”) to purchase shares of various entities, including special purpose acquisition companies and/or other privately-held or publicly-traded entities (each, an “Investee,” and such purchases, the “Investments”).

During the nine months ended September 30, 2022 and the year ended December 31, 2021, the Company purchased shares for a total investment of $ 124.5 million and $ 326.0 million, respectively.

During the three months ended September 30, 2022, the Company purchased 3.5 million shares of Rubicon Technologies for $ 35.0 million pursuant to the applicable Investment Agreement.

In connection with signing the Investment Agreements, each Investee or an associated entity and the Company entered into a commercial contract for access to the Company’s products and services.

The terms of such contracts, including contractual options, range from three to ten years .

The majority of these commercial contracts are subject to various termination provisions.

The Company assesses the concurrent agreements under the noncash and consideration paid or payable to a customer guidance within ASC 606— Revenue from Contracts with Customers as well as the commercial substance of each arrangement considering the customer’s ability and intention to pay as well as the Company’s obligation to perform under each contract.

As currently assessed, the total value of such commercial contracts with Investees or associated entities was $ 754.9 million as of September 30, 2022, which is inclusive of $ 116.2 million of contractual options.

As of September 30, 2022, the cumulative amount of revenue recognized from commercial contracts with Investees was $ 147.0 million, of which $ 28.1 million and $ 98.7 million of revenue was recognized during the three and nine months ended September 30, 2022, respectively.

From 2021 through 2022, the Company approved and entered into certain agreements (“Investment Agreements”) to purchase shares of various entities, including special purpose acquisition companies and/or other privately-held or publicly-traded entities (each, an “Investee,” and such purchases, the “Investments”).

During the year ended December 31, 2022, the Company purchased shares for a total investment of $ 124.5 million.

No Investments were purchased under such Investment Agreements during the three months ended March 31, 2023.

In connection with signing the Investment Agreements, each Investee or an associated entity and the Company entered into a commercial contract for access to the Company’s products and services (collectively, the “Strategic Commercial Contracts”).

The terms of such contracts, including contractual options, range from two to seven years and are subject to termination for cause provisions.

The Company assesses the concurrent agreements under the noncash consideration paid or payable to a customer guidance within Accounting Standards Codification 606, Revenue from Contracts with Customers, as well as the commercial substance of each arrangement considering the customer’s ability and intention to pay as well as the Company’s obligation to perform under each contract.

As currently assessed, the total value of such Strategic Commercial Contracts with Investees or associated entities was $ 390.3 million as of March 31, 2023, which is inclusive of $ 43.7 million of contractual options.

The Company performs ongoing assessments of customers’ financial condition, including the consideration of such customers’ ability and intention to pay, and whether all or some portion of the value of such contracts continue to meet the criteria for revenue recognition, among other factors.

As of March 31, 2023, the cumulative amount of revenue recognized from Strategic Commercial Contracts was $ 200.1 million, of which $ 33.4 million of revenue was recognized during the three months ended March 31, 2023.

Alternative Investments

During the year ended December 31, 2021, the Company purchased $ 50.9 million in 100 -ounce gold bars.

The gold bars are kept in a secure third-party facility located in the northeastern United States.

The Company is able to take physical possession of the gold bars stored at the facility at any time with reasonable notice.

During the three and nine months ended September 30, 2022, the Company recorded net unrealized losses of $ 2.6 million related to alternative investments within other income (expense), net on the condensed consolidated statements of operations.

During the three and nine months ended September 30, 2021, the Company recorded net unrealized losses of $ 1.8 million related to alternative investments within other income (expense), net on the condensed consolidated statements of operations.

During the three months ended March 31, 2023, the Company sold all of its gold bars for total proceeds of $ 51.1 million and recorded an immaterial realized gain within other income (expense), net on the condensed consolidated statements of operations.

Balance Sheet Components

1 unchanged sentence

Property and equipment, net consisted of the following (in thousands):

As of September 30, 2022 As of December 31, 2021

As of March 31, 2023 As of December 31, 2022

Leasehold improvements $ 81,802 $ 80,378

5 unchanged sentences

Total property and equipment, net $ 63,115 $ 69,170

Depreciation and amortization expense related to property and equipment, net was $ 5.5 million and $ 3.1 million for the three months ended September 30, 2022 and 2021, respectively, and $ 13.9 million and $ 9.3 million for the nine months ended September 30, 2022 and 2021, respectively.

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Depreciation and amortization expense related to property and equipment, net was $ 5.9 million and $ 3.9 million for the three months ended March 31, 2023 and 2022, respectively.

Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

As of September 30, 2022 As of December 31, 2021

As of March 31, 2023 As of December 31, 2022

Accrued payroll and related expenses $ 47,050 $ 43,495

Accrued taxes 50,420 41,326

Accrued other liabilities 77,055 87,894

Total accrued liabilities $ 174,525 $ 172,715

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

2014 Credit Facility

In October 2014, the Company entered into an unsecured revolving credit facility, which has been subsequently secured by substantially all of the Company’s assets and amended from time to time (as amended, the “2014 Credit Facility”), including on March 31, 2022 (the “March 2022 Amendment”) and on July 1, 2022 (the “July 2022 Amendment”).

The March 2022 Amendment provided for, among other things, an extension of the revolving loan facility maturity date to March 31, 2027 and an increase of $ 100.0 million to the lenders’ revolving commitments for total revolving commitments of $ 500.0 million.

The July 2022 Amendment provided for, among other things, a new incremental delayed draw term loan (“DDTL”) facility in an aggregate principal amount of up to $ 450.0 million, upon the terms and conditions set forth in the 2014 Credit Facility, as amended, with new and existing lenders.

The DDTL facility is available to draw upon through July 1, 2023 and any drawn amounts will mature on March 31, 2027.

As of September 30, 2022, the 2014 Credit Facility allows for the drawdown of up to $ 950.0 million to fund working capital and general corporate expenditures.

As of March 31, 2023, the 2014 Credit Facility allows for the drawdown of up to $ 950.0 million to fund working capital and general corporate expenditures, which includes total revolving commitments of $ 500.0 million and a delayed draw term loan (“DDTL”) commitment of $ 450.0 million, each with a maturity date of March 31, 2027.

The DDTL commitment is available to draw upon through July 1, 2023.

Outstanding balances under the 2014 Credit Facility would incur interest at the Secured Overnight Financing Rate (“SOFR”) as administered by the Federal Reserve Bank of New York, or a successor administrator of the SOFR (or the applicable benchmark replacement), plus 2.00 % or a base rate plus 1.00 %, subject to certain adjustments.

The Company incurs a commitment fee of 0.30 % assessed on the daily average undrawn portion of revolving commitments.

The Company incurs a commitment fee of 0.30 % assessed on the daily average undrawn portion of revolving and DDTL commitments.

Applicable interest and commitment fees are payable quarterly or more or less frequently in certain circumstances.

The 2014 Credit Facility also allows for an incremental loan facility of additional term loans or revolving loans in an aggregate principal amount up to the amount and upon the terms and conditions set forth therein with one or more existing or new lenders upon mutual agreement between the Company and such lenders.

As of September 30, 2022, the Company had no outstanding debt balances and $ 950.0 million undrawn of revolving or DDTL commitments under the 2014 Credit Facility.

As of March 31, 2023, the Company had no outstanding debt balances and an aggregate of $ 950.0 million undrawn of revolving and DDTL commitments under the 2014 Credit Facility.

The 2014 Credit Facility contains customary representations and warranties, and certain financial and nonfinancial covenants, including but not limited to maintaining minimum liquidity of $ 50.0 million, and certain limitations on liens and indebtedness.

The Company was in compliance with all covenants associated with the 2014 Credit Facility as of September 30, 2022.

The Company was in compliance with all covenants associated with the 2014 Credit Facility as of March 31, 2023.

Commitments and Contingencies

Purchase Commitments

In December 2019, the Company entered into, and subsequently amended, a minimum annual commitment to purchase cloud hosting services of at least $ 1.49 billion over six contract years, with an optional carryover period through June 30, 2029, in exchange for various discounts on such services.

In December 2019, the Company entered into, and subsequently amended, a minimum annual commitment to purchase cloud hosting services of at least $ 1.49 billion over six contract years, with an optional carryover period through September 30, 2029, in exchange for various discounts on such services.

If the spend does not meet the minimum annual commitment each year or at the end of the term, the Company is obligated to make a return payment.

If the difference is greater than $ 30.0 million for each of the first three contract years or $ 50.0 million for each of the contract years thereafter (“relief amounts”), the Company has the option to pay the respective relief amount for that year for services to be utilized in the future and the excess amount of the difference above the relief amount would be added to the minimum annual commitment of the following year through the end of the contract.

In May 2022, the agreement was amended to extend the second contract year from June 30, 2022 to September 30, 2022 and the optional carryover period from June 30, 2029 to September 30, 2029.

The Company satisfied its $ 167.0 million commitment for the contract year ended September 30, 2022.

The commitment amount for the contract year ending September 30, 2023 is $ 199.0 million.

As of March 31, 2023, the Company satisfied $ 82.3 million of its $ 199.0 million commitment for contract year three ending September 30, 2023.

Litigation and Legal Proceedings

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securities claims;

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

investor claims;

corporate claims;

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The Company establishes an accrual for loss contingencies when the loss is both probable and reasonably estimable.

On December 14, 2017, members of KT4 Partners LLC (Managing Member Marc Abramowitz) and Sandra Martin Clark, as trustee for the Marc Abramowitz Irrevocable Trust Number 7 (together, “KT4 Plaintiffs”), filed an action in the Delaware Superior Court against the Company and Disruptive Technology Advisers LLC.

The complaint alleges tortious interference with prospective economic advantage and civil conspiracy in connection with a potential sale of stock by the KT4 Plaintiffs to a third party.

The KT4 Plaintiffs sought compensatory and punitive damages, interest, fees, and costs.

On June 27, 2022, the Company and the KT4 Plaintiffs entered into an agreement to settle the litigation and certain other matters.

The Company has paid the amount of the settlement in full and has received the insurance reimbursement as of September 30, 2022.

On September 15, 2022, October 25, 2022, and November 4, 2022, putative securities class action complaints were filed in the United States District Court for the District of Colorado, captioned Cupat v.

Palantir Technologies Inc., et al.

Palantir Technologies Inc., et al., Case No.

1:22-cv-02384, Allegheny County Employees’ Retirement System v.

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1:22-cv-02893, respectively, naming the Company and certain current and former officers and directors as defendants.

The suits allege false and misleading statements about our business and prospects, and purport to allege claims under the Securities Exchange Act of 1934 and the Securities Act of 1933.

The Company disputes these claims and intends to defend these matters vigorously.

The suits allege false and misleading statements about our business and prospects, and purport to allege claims under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the Securities Act of 1933, as amended (the “Securities Act”),

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

and seek unspecified damages and remedies under Sections 10(b), 20(a), and 20(A) of the Exchange Act and Sections 11 and 15 of the Securities Act.

These three actions subsequently were consolidated as Cupat v.

Palantir Technologies Inc., et al., Lead Civil Action No.

1:22-cv-02834-CNS-SKC, consolidated with civil actions 1:22-cv-02805-CNS-SKC and 1:22-cv-02893-CNS-SKC.

On November 21, 2022 and January 13, 2023, stockholder derivative actions were filed in the United States District Court for the District of Colorado, captioned Li v.

Karp, et al., Case No.

22-cv-3028 and Parmenter v.

Karp, et al., Case No.

23-cv-118, and on January 27, 2023, a stockholder derivative action was filed in the United States District Court for the District of Delaware captioned Miao v.

Karp, et al., Case No.

1:23-cv-00103-MN, each against certain current and former officers and directors asserting breach of fiduciary duty and related claims relating to the allegations of the securities class action complaints and seek unspecified damages and injunctive remedies under Section 14(a) of the Exchange Act and Delaware law.

Because the litigation is in early stages, the Company is unable to estimate the reasonably possible loss or range of loss, if any, that may result from these matters.

As of September 30, 2022, the Company was not aware of any currently pending legal matters or claims, individually or in the aggregate, that were expected to have a material adverse impact on its condensed consolidated financial statements.

As of March 31, 2023, the Company was not aware of any currently pending legal matters or claims, individually or in the aggregate, that were expected to have a material adverse impact on its condensed consolidated financial statements.

Letters of Credit and Guarantees

The Company had irrevocable standby letters of credit and guarantees, including bank guarantees, outstanding in the amounts of $ 41.5 million and $ 76.2 million as of September 30, 2022 and December 31, 2021, respectively, which were fully collateralized.

The Company had irrevocable standby letters of credit and guarantees, including bank guarantees, outstanding in the amounts of $ 24.0 million and $ 28.8 million as of March 31, 2023 and December 31, 2022, respectively, which were fully collateralized.

The Company is required to maintain these letters of credit and guarantees primarily in connection with operating lease agreements, certain customer contracts, and other guarantees and financing arrangements.

As of September 30, 2022, these letters of credit and guarantees had expiration dates through August 31, 2031.

As of March 31, 2023, these letters of credit and guarantees had expiration dates through August 2031.

Warranties and Indemnification

The Company generally provides a warranty for its software products and services and a service level agreement (“SLA”) for the Company’s performance of software operations via its operations and maintenance (“O&M”) services to its customers.

The Company’s products are generally warranted to perform substantially as described in the associated product documentation during the subscription term or for a period of up to 90 days where the software is hosted by the customer, and the Company includes O&M services as part of its subscription and license agreements to support this warranty and maintain the operability of the software.

The Company generally provides a warranty for its software products and services and a service level agreement (“SLA”) for the Company’s performance of software operations.

The Company’s products are generally warranted to perform substantially as described in the associated product documentation during the subscription term or for a period of up to 90 days where the software is hosted by the customer, and the Company includes operations and maintenance (“O&M”) services as part of its subscription and license agreements to support this warranty and maintain the operability of the software.

The Company’s services are generally warranted to be performed in a professional manner and by an adequate staff with knowledge about the products.

In the event there is a failure of such warranties, the Company generally is obligated to correct the product or service to conform to the warranty provision, as set forth in the applicable SLA, or, if the Company is unable to do so, the customer is entitled to seek a refund of the purchase price of the product and service (generally prorated over the contract term).

In the event there is a failure of such warranties, the Company generally is obligated to correct the product or service to conform to the warranty provision, or, if the Company is unable to do so, the customer is entitled to seek a refund of the purchase price of the product and service (generally prorated over the contract term).

Due to the absence of historical warranty claims, the Company’s expectations of future claims related to products under warranty continue to be insignificant.

The Company has not recorded warranty expense or related accruals as of September 30, 2022 and December 31, 2021.

The Company has not recorded warranty expense or related accruals as of March 31, 2023 and December 31, 2022.

The Company generally agrees to indemnify its customers against legal claims that the Company’s software products infringe certain third-party intellectual property rights and accounts for its indemnification obligations.

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or, if those options are not commercially practicable, to refund the cost of the software, as prorated over the period.

To date, the Company has not been required to make any payment resulting from infringement claims asserted against its customers and does not believe that the Company will be liable for such claims in the

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

foreseeable future.

As such, the Company has not recorded a liability for infringement costs as of September 30, 2022 and December 31, 2021.

The Company has obligations under certain circumstances to indemnify each of the defendant directors and certain officers against judgments, fines, settlements, and expenses related to claims against such directors and certain officers and otherwise to the fullest extent permitted under the law and the Company’s bylaws and Amended and Restated Certificate of Incorporation.

As such, the Company has not recorded a liability for infringement costs as of March 31, 2023 and December 31, 2022.

The Company has obligations under certain circumstances to indemnify each of the defendant directors and certain officers against judgments, fines, settlements, and expenses related to claims against such directors and certain officers and otherwise to the fullest extent permitted under the law and the Company’s Amended and Restated Bylaws and Amended and Restated Certificate of Incorporation.

Stockholders' Equity

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The Class F common stock has the voting rights generally described herein and each share of Class F common stock is convertible at any time, at the option of the holder thereof, into one share of Class B common stock.

All shares of Class F common stock are held in a voting trust established by Stephen Cohen, Alexander Karp, and Peter Thiel (the “Founders”).

The Class F common stock generally gives the Founders the ability to control up to 49.999999 % of the total voting power of the Company's capital stock, so long as the Founders and certain of their affiliates collectively meet a minimum ownership threshold, which was 100.0 million of the Company's equity securities as of September 30, 2022.

All shares of Class F common stock are held in a voting trust established by Stephen Cohen, Alexander Karp, and Peter Thiel (the

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Holders of the common stock are entitled to dividends when, as, and if declared by the Company’s Board of Directors, subject to the rights of the holders of all classes of stock outstanding having priority rights to dividends.

No dividends have been declared as of September 30, 2022.

No dividends have been declared as of March 31, 2023.

The following represented the total authorized, issued, and outstanding shares for each class of common stock (in thousands):

As of September 30, 2022 As of December 31, 2021

As of March 31, 2023 As of December 31, 2022

Authorized Issued and Outstanding Authorized Issued and Outstanding

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Stock Options

The following table summarizes stock option activity for the nine months ended September 30, 2022 (in thousands, except per share amounts):

The following table summarizes stock option activity for the three months ended March 31, 2023 (in thousands, except per share amounts):

Options Outstanding Weighted-Average Exercise Price Per Share

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Options canceled and forfeited ( 847 ) 4.79

Balance as of September 30, 2022 331,121 $ 8.00 8.54 $ 568,915

Options vested and exercisable as of September 30, 2022 179,077 $ 5.61 7.55 $ 525,193

As of September 30, 2022, the total unrecognized stock-based compensation expense related to options outstanding was $ 759.7 million, which is expected to be recognized over a weighted-average service period of eight years .

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The following table summarizes the RSU activity for the nine months ended September 30, 2022 (in thousands, except per share amounts):

Balance as of March 31, 2023 320,685 $ 8.11 8.14 $ 583,293

Options vested and exercisable as of March 31, 2023 184,837 $ 5.92 7.30 $ 561,553

As of March 31, 2023, the total unrecognized stock-based compensation expense related to options outstanding was $ 686.5 million which is expected to be recognized over a weighted-average service period of seven years .

The following table summarizes the RSU activity for the three months ended March 31, 2023 (in thousands, except per share amounts):

RSUs Outstanding Weighted Average Grant Date Fair Value per Share

Balance as of December 31, 2021 153,749 $ 9.56

RSUs unvested and outstanding as of December 31, 2022 126,426 $ 10.07

RSUs granted 7,315 7.47

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RSUs canceled ( 3,407 ) 10.29

Balance as of September 30, 2022 131,107 $ 10.15

As of September 30, 2022, the total unrecognized stock-based compensation expense related to the RSUs outstanding was $ 779.3 million, which the Company expects to recognize over a weighted-average service period of three years .

RSUs unvested and outstanding as of March 31, 2023 117,059 $ 9.94

As of March 31, 2023, the total unrecognized stock-based compensation expense related to the RSUs outstanding was $ 703.2 million, which the Company expects to recognize over a weighted-average service period of three years .

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Stock-based Compensation Expense

Total stock-based compensation expense was as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Three Months Ended March 31,

Cost of revenue $ 9,177 $ 11,677

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Total stock-based compensation expense $ 114,714 $ 149,323

The Company recorded a provision for income taxes of $ 1.1 million and $ 1.4 million for the three months ended September 30, 2022 and 2021, respectively, and a provision for income taxes of $ 5.7 million and a benefit from income taxes of $ 1.1 million for the nine months ended September 30, 2022 and 2021, respectively.

The Company recorded a provision for income taxes of $ 1.7 million and $ 2.0 million for the three months ended March 31, 2023 and 2022, respectively.

The Company is subject to income tax in the U.S.

as well as other tax jurisdictions in which it conducts business.

The Company’s effective tax rate as of September 30, 2022 differs from the U.S.

statutory rate primarily due to foreign income taxed at different rates, foreign withholding taxes, and valuation allowances recorded on its losses from the U.S., United Kingdom (“U.K.”), and other jurisdictions .

The provision for income taxes decreased by $ 0.3 million and increased by $ 6.8 million from a benefit from income taxes for the three and nine months ended September 30, 2022, respectively, compared to the same periods in 2021.

These changes are primarily due to the absence in the current period of the revaluation of the Company’s U.K.

deferred tax assets as a result of a change in the U.K.

corporate tax rate enacted in June 2021.

The Company’s effective tax rate as of March 31, 2023 differs from the U.S.

statutory rate primarily due to foreign income taxed at different rates, non-deductible stock-based compensation, and valuation allowances recorded on its deferred tax assets from the U.S., United Kingdom (“U.K.”), and other jurisdictions .

There was no material change in the provision for income taxes for the three months ended March 31, 2023 compared to the three months ended March 31, 2022.

The realization of deferred tax assets is dependent upon the generation of sufficient taxable income of the appropriate character in future periods.

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Accordingly, the Company has maintained a full valuation allowance on its U.S.

deferred tax assets as of September 30, 2022.

Provisions enacted in the 2017 Tax Cuts and Jobs Act related to the capitalization for tax purposes of research and experimental (“R&E”) expenditures became effective on January 1, 2022.

Beginning January 1, 2022, all U.S.

based R&E expenditures must be capitalized and amortized over five and fifteen years, respectively.

Congress is considering legislation that would defer the amortization requirement to future periods.

However, there is no assurance that the provision will be deferred, repealed or otherwise modified.

The effect of the requirement did not have a material impact on our income tax provision.

deferred tax assets as of March 31, 2023.

Net Earnings (Loss) Per Share Attributable to Common Stockholders

The following table presents the calculation of basic and diluted net earnings (loss) per share attributable to common stockholders (in thousands, except per share amounts):

Three Months Ended March 31,

Net income (loss) attributable to common stockholders for diluted net earnings (loss) per share $ 16,802 $ ( 101,379 )

Weighted-average shares used in computing net earnings (loss) per share, basic 2,107,780 2,036,307

Weighted-average shares used in computing net earnings (loss) per share, diluted 2,217,439 2,036,307

Net earnings (loss) per share

Net earnings (loss) per share attributable to common stockholders, basic $ 0.01 $ ( 0.05 )

Net earnings (loss) per share attributable to common stockholders, diluted $ 0.01 $ ( 0.05 )

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

On August 16, 2022, the U.S.

enacted the Inflation Reduction Act of 2022, which, among other things, implements a 15% minimum tax on book income of certain large corporations, a 1% excise tax on net stock repurchases and several tax incentives to promote clean energy.

Based on the Company's current analysis of the provisions, the Company does not believe this legislation will have a material impact on its condensed consolidated financial statements.

Net Loss Per Share Attributable to Common Stockholders

The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except per share amounts):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Net loss attributable to common stockholders, for diluted net loss per share $ ( 123,875 ) $ ( 102,137 ) $ ( 404,583 ) $ ( 364,191 )

Weighted-average shares used in computing net loss per share, basic 2,073,265 1,964,395 2,054,926 1,893,911

Weighted-average shares used in computing net loss per share, diluted 2,073,265 1,964,395 2,054,926 1,893,911

Net loss per share

Net loss per share attributable to common stockholders, basic $ ( 0.06 ) $ ( 0.05 ) $ ( 0.20 ) $ ( 0.19 )

Net loss per share attributable to common stockholders, diluted $ ( 0.06 ) $ ( 0.05 ) $ ( 0.20 ) $ ( 0.19 )

The following outstanding potentially dilutive common stock equivalents have been excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented due to their anti-dilutive effect (in thousands):

As of September 30,

Options and stock appreciation rights issued and outstanding 331,121 374,555

The following outstanding potentially dilutive common stock equivalents have been excluded from the computation of diluted net earnings (loss) per share attributable to common stockholders for the periods presented due to their anti-dilutive effect (in thousands):

As of March 31,

Options issued and outstanding 162,521 342,475

RSUs outstanding 23,006 140,793

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These unallocated costs include stock-based compensation expense, research and development expenses, and general and administrative expenses.

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Financial information for each reportable segment was as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Three Months Ended March 31,

Government $ 289,070 $ 241,790

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Total revenue $ 525,186 $ 446,357

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Three Months Ended March 31,

Contribution:

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Total contribution $ 279,160 $ 252,418

The reconciliation of contribution to loss from operations is as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Loss from operations $ ( 62,191 ) $ ( 91,941 ) $ ( 143,375 ) $ ( 352,103 )

The reconciliation of contribution to income (loss) from operations is as follows (in thousands):

Three Months Ended March 31,

Income (loss) from operations $ 4,115 $ ( 39,439 )

Research and development expenses (1)

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(1) Excludes stock-based compensation expense.

Palantir Technologies Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Geographic Information

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Revenue is as follows (in thousands, except percentages):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Amount % Amount % Amount % Amount %

Three Months Ended March 31,

Amount % Amount %

United States $ 336,845 64 % $ 272,913 61 %

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Total revenue $ 525,186 100 % $ 446,357 100 %

(1) No other country represents 10 % or more of total revenue for the three and nine months ended September 30, 2022 or 2021.

(1) No other country represents 10 % or more of total revenue for the three months ended March 31, 2023 or 2022.

Intangible Assets

Intangible assets subject to amortization that are not fully amortized are as follows (in thousands):

Weighted average useful life As of March 31, 2023 As of December 31, 2022

Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount

Customer relationships 4.58 $ 10,400 $ ( 867 ) $ 9,533 $ 10,400 $ ( 347 ) $ 10,053

Reacquired rights 6.58 17,619 ( 1,048 ) 16,571 17,619 ( 420 ) 17,199

Backlog 1.58 6,700 ( 1,396 ) 5,304 6,700 ( 558 ) 6,142

Other 1.02 4,224 ( 2,502 ) 1,722 5,717 ( 3,572 ) 2,145

Total intangible assets $ 38,943 $ ( 5,813 ) $ 33,130 $ 40,436 $ ( 4,897 ) $ 35,539

Amortization expense of intangible assets was not material for the three months ended March 31, 2023 or 2022.

As of March 31, 2023, expected amortization expense for the unamortized finite-lived intangible assets is as follows (in thousands):

Year ended December 31, Amount

Remainder of 2023 $ 7,228

Thereafter 4,614

Total $ 33,130

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

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• our expectations concerning relationships with third parties, including our customers, equity method investment partners, and vendors;

• our expectations regarding our recent investments in, and enterprise agreements with, various entities, including special purpose acquisition companies and/or other privately-held or publicly-traded entities;

• our expectations regarding our investments in, and enterprise agreements with, various entities, including special purpose acquisition companies and/or other privately-held or publicly-traded entities;

• our ability to maintain, protect, and enhance our intellectual property;

• our expectations regarding our multi-class stock and governance structure and the benefits thereof;

• our expectations regarding macroeconomic events, including rising inflation and interest rates and monetary policy changes;

• the impacts of the ongoing coronavirus (“COVID-19” or “COVID”) pandemic and the ongoing Russian invasion of Ukraine, including on our and our customers’, vendors’, and partners’ respective businesses and the markets in which we and our customers, vendors, and partners operate;

• our expectations regarding macroeconomic conditions, including rising inflation and interest rates, monetary policy changes, or financial services sector instability;

• the impacts of the ongoing coronavirus (“COVID-19”) pandemic and the ongoing Russia-Ukraine conflict, including on our and our customers’, vendors’, and partners’ respective businesses and the markets in which we and our customers, vendors, and partners operate;

• the impacts of the volatility and fluctuations in currency exchange rates, including an increase in the strength of the United States (“U.S.”) dollar, on the costs of our products outside of the United States and on customer demand;

• the increased expenses associated with being a public company.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements