You hear Michael Burry still loading up on long-dated Palantir puts — June 2027 $50 strikes and December 2026 $100 strikes — and the chorus chants the same tune: this stock at roughly 97-99x forward earnings on $1.31 2026 EPS estimates is pure AI hype, doomed to collapse like every overvalued software name before it. Consensus has spoken. Burry's track record adds weight. The stock sits near $128 with a $306 billion market cap after a brutal 28% YTD drop in 2026, even with a Trump boost. Everyone's waiting for the air to come out.
Except the air isn't there. In Q4 2025, Palantir's US commercial revenue exploded 137% year-over-year to $507 million while total US revenue jumped 93% to $1.076 billion and overall revenue rose 70% to $1.407 billion, beating estimates handily. That's not narrative fluff — that's documented traction in the AIP platform driving enterprise deals that peers can only dream about. Burry's $50 target implies the entire US commercial engine basically flatlines from here. Reality already delivered the opposite punchline.
Look closer and the disconnect sharpens. Palantir guided FY2026 revenue to $7.182-7.198 billion, up 61% year-over-year, with US commercial alone clearing $3.144 billion — that's over 115% growth. Adjusted operating income is eyed around $4.13 billion. Meanwhile, the rule-of-40 score hit 127% in Q4 on that growth plus a 57% adjusted operating margin. Adjusted free cash flow margin landed at 56% with $791 million generated in the quarter alone, and the balance sheet sits on $7.2 billion in cash and equivalents with zero debt. You tell me which software company is printing cash like this while accelerating in the exact segment everyone claims is saturated.
Peers are slowing. Palantir isn't. The market obsesses over the trailing 200x+ P/E and Burry's headlines, yet ignores how this earnings power rewires the valuation math. At current levels the forward multiple looks insane, but sustained 60%+ revenue growth compounded with 50%+ margins compresses it faster than sentiment can process. Those puts need a near-term collapse to pay off. Instead, Q4 showed US commercial now driving the bulk of incremental growth, with remaining deal value up 145% year-over-year to $4.38 billion. That's durable platform stickiness, not one-off hype. Burry started the position in fall 2025; the data since has only widened the gap between his bet and execution.
This isn't about defending high multiples forever. It's about recognizing when real business momentum overrides the short thesis. Palantir's commercial acceleration collides directly with the slowing growth narratives pinned on the broader sector. Every large deal closed — 61 over $10 million in Q4 — reinforces that enterprises are paying up for operational AI that delivers measurable outcomes. The $306 billion market cap starts looking more reasonable as that $4+ billion in adjusted operating income for 2026 comes into focus. Burry's puts, tied to strikes that require a 60-80%+ drawdown from here, face a simple problem: the numbers keep proving the bear case premature.
You're left with a clean setup. The consensus crowds the valuation debate and Burry's contrarian cred while the actual commercial engine hums louder. If this execution holds — and every data point from Q4 through guidance says it will — those long-dated puts expire worthless as earnings power does the heavy lifting on valuation. Markets price one path. Palantir keeps delivering three.