Palantir Urges Clients to Avoid DeepSeek’s AI Models Palantir Technologies has advised its clients to refrain from using AI models developed by Chinese startup DeepSeek, citing national security concerns. The warning comes amid growing apprehension over the United States’ dominance in artificial intelligence.
“We would strongly discourage it (DeepSeek) and don’t think any customer in the U.S. government will be able to use it,” said Ryan Taylor, Palantir’s Chief Revenue Officer, on Monday. His comments align with heightened scrutiny from U.S. officials, as the White House reviews the security risks associated with DeepSeek’s technology.
Federal agencies, including NASA, have reportedly prohibited their employees from using DeepSeek’s AI models, underscoring concerns about potential cybersecurity threats.
Palantir’s Financial Performance Exceeds Expectations In addition to voicing security concerns, Palantir delivered a positive financial outlook, forecasting first-quarter and full-year revenue above Wall Street expectations. The company revealed that over 40% of its fourth-quarter sales came from the U.S. government.
Following the announcement, Palantir’s shares soared by 22% in extended trading. The company projected fiscal 2025 revenue between $3.74 billion and $3.76 billion, surpassing analysts’ average estimate of $3.52 billion, according to data from LSEG.
Co-founded by tech billionaire Peter Thiel, Palantir is renowned for providing critical data analytics services to government entities, including software that visualizes army positions. “On the government side, Palantir’s vision is very well aligned with the current administration,” noted D.A. Davidson analyst Gil Luria.
Expansion Beyond Government Contracts While government contracts remain a core component of its business, Palantir is actively working to reduce reliance on public sector spending. The company anticipates U.S. commercial revenue to grow by at least 54% in 2025, exceeding $1.80 billion.
The rising demand for generative artificial intelligence technologies has played a significant role in boosting Palantir’s AI Platform (AIP) sales. AIP is used for testing, debugging code, and evaluating AI-related scenarios, making it a valuable tool for enterprises pushing AI adoption.
Palantir forecasted March-quarter revenue between $858 million and $862 million, well above the estimated $799.4 million.
Impact of U.S. Tariffs and Supply Chain Disruptions Expanded tariffs introduced by former President Donald Trump on Saturday are expected to further drive demand for Palantir’s analytics services, particularly in supply chain and logistics management. Taylor noted that businesses looking to navigate the complexities of global trade restrictions could benefit from Palantir’s software solutions.
Earnings and Market Response On an adjusted basis, Palantir reported earnings of 14 cents per share in the fourth quarter, outperforming analyst expectations of 11 cents per share. The strong earnings report, coupled with the company’s positive revenue forecast, has reinforced investor confidence in Palantir’s long-term growth trajectory.
As the company continues to expand its AI offerings and commercial reach, its stance against Chinese AI models like DeepSeek highlights broader geopolitical concerns shaping the future of artificial intelligence and data security in the U.S.
