Palantir Q2 Earnings Surge 50% Revenue 144% Net Income Sparks Tech Rally

Stocks surged following Palantir Technologies Inc. (NASDAQ:PLTR)’s second quarter 2025 earnings report, with revenue rising nearly 50% and net income climbing 144% to $327 million [1]. The results, which exceeded Wall Street expectations, fueled optimism about AI-driven efficiency and headcount reductions, sending the stock up 4% on the day and another 5% in overnight trading. CEO Alex Karp outlined a bold growth strategy, aiming for a tenfold increase in revenue while reducing the workforce from 4,100 to 3,600. The performance sparked a broader tech rally, as investors increasingly bet on AI’s potential to reshape the industry. Wedbush analyst Daniel Ives described the earnings call as “eye-popping,” highlighting a shift in market sentiment toward high-growth tech names [2].

The positive momentum extended beyond Palantir. S&P 500 futures rose 0.27% in premarket trading, while European and Asian indices also posted gains. This broad-based rally was driven by a combination of strong earnings, expectations of early Federal Reserve rate cuts, and growing confidence in the Q2 earnings season [7]. The CME’s Fed Funds futures market currently prices in an 88% chance of a rate cut in September and a 60% probability in October—far earlier than the previous December forecast [5]. Deutsche Bank analysts noted that a “decent Q2 earnings season so far” is helping to sustain the bullish mood among equity investors [4].

Despite the optimism, Goldman Sachs issued a stark warning that the U.S. economy is “near stall speed,” a state in which growth slows to a point where labor market weakness becomes self-reinforcing [3]. Chief economist Jan Hatzius highlighted that underlying job growth has sharply declined, falling from an average of 206,000 in Q1 to just 28,000 in July. This is far below the estimated breakeven pace of 90,000, raising concerns about the sustainability of current economic conditions. Although the unemployment rate remains relatively low at 4.248%, the decline in job creation suggests a weakening labor market. Goldman’s Risk Appetite Indicator was above zero in July, reflecting a generally risk-on stance among equity investors, but this optimism is increasingly being challenged by macroeconomic headwinds [4].

Looking ahead, concerns persist over the long-term impact of President Trump’s tariff policies. Analysts at Pantheon Macroeconomics noted that the recent DOGE cuts, along with an 11.2% drop in federal nondefense spending, reduced Q2 GDP growth by 0.3 percentage points [6]. Trump’s focus on imposing high tariffs on BRICS nations—particularly China—has raised the possibility of renewed trade tensions, which could weigh on global markets and investor sentiment. ING analysts warned that if the U.S. escalates pressure on China, it could trigger a market sell-off and force investors to reassess the outlook for global growth [4].

Sources:

[1] https://www.quiverquant.com/news/category/summary

[2] https://www.advisorperspectives.com/firm/bloomberg-news

[3] https://eng.pressbee.net/show4115793.html?title=brussels-will-punish-britain-for-not-following-its-demands

[4] https://fortune.com/2025/08/05/stocks-palantir-goldman-stall-speed/

[5] https://eng.pressbee.net/show4115798.html?title=tommy-robinson-s-legal-cases-and-criminal-charges-explained