All right welcome everybody to this live stream of the palantir q1 results. Please let me know if nothing's working, i'm using new software for the first time, uh uh. Hopefully, it's all going to be working just fine, but um we're going to be covering the results as they come out and we're going to be then going covering the live call the live calls starting in an hour and a half. So this is a little bit early, however, last time around and the time before that the results came out roughly at this sort of time.

So i thought i would just jump in uh and the moment that the results come out, i'm going to be covering them here, i'm going to be showing you i'm going to be refreshing. The things and i'll show you everything on the screen. I'm going to be discussing some of the important points before the results come out. I just equip myself with tea, so i am ready for all eventualities, gon na be here for a little while um, but just before the results come out and they should be out any minute now um.

I want to just cover some of the really important things that, for me, i think we need to discuss in this set of results. Um, some of the most important things for me are uh to understand what the commercial growth rate is so last time they guided for a 29.9, but i think it's probably 30.0 percent growth uh on the same quarter last year, and that was quite interesting because that Is their long-term objective, so the guidance kind of sounds like it's not really necessarily based on what they're seeing as performance within the quarter, because the report results relatively late compared to most so they already see half the quarter. But you know right now we're halfway roughly through the quarter, so it looks like the results are kind of guided by their long-term stuff, rather than necessarily what they're, seeing so we'll see what the results are. We're uh wanting to see what the effects of the spak ride downs are want to see where the splits by region are including the um impacts of the government slowdown.

So i don't know if you've noticed, but um valencia's results from the previous several quarters. The government revenue growth has been slowing down massively and the objective over the last two quarters has been to replace that revenue with uh revenue from uh from the commercial side, but the commercial side hasn't really been growing fast enough, and that became a real problem. Like two quarters ago and last quarter to address that, and they spent a lot of time talking about like a huge hiring spree they've, been hiring a huge number of different sales staff into different regions into europe as well and um. So far that hasn't materialized into the sort of growth, commercial growth has been growing and growing really fast within the us in particular, but globally it hasn't been growing quite as fast and there's two things there.

One um are the sales staff beginning to deliver in terms of their commercial side, growth, but two - and this is probably quite interesting because uh of the situation we're finding ourselves in terms of global security, the russian invasion of ukraine, all of those kind of things lots Of different countries are significantly ramping their military spending of different kind, especially with intelligence, with systems with analytics of data and stuff, like that, so the us government spending a lot of money. A lot of european countries are germany for the first time since world war, two has said: they're now going to be spending a proper like two two and a half percent of their budget on military needs. So there's a lot of potential there for palantir to be hoovering up new contracts. It'll be interesting to see.

If we hear anything about this or see anything about this uh, whether we're going to be seeing the idea iq number uh published at all anywhere for the us and whether we're going to be seeing that pipeline number that's been sort of flatlining, it was. You know three and a half billion 3.6 billion pipeline and it wasn't really growing whether that number has grown got up. Let's see if the results are out, not quite yet so. Let's talk about, let me share a few things that i wanted to just discuss before the results come out um.

Let me figure out how i how i share my screen here here. We go all right. So if we look at some of the pre uh, the last annual report, um one thing - that's going to be abundantly clear - is that the stock based conversation is going to be a really important talking point. It is every single time i know in the comments section in the live chat.

People are discussing uh, all of the stuff they're saying hey, you know like these guys are printing shares like crazy, and here you can see it um. The operational loss uh for 2021 was 411 million dollars, but almost 780 million of that was stop-based conversation. So without the stock based compensation, the company is actually earning cash from operations. So if you kind of like, if you ignore the accounting side of things in terms of what comes into the bank, account what leaves the bank account in real terms right, the company is earning cash um.

The reason that they are posting loss is because they keep paying out all of this uh all of these options, uh uh through shares to their employees. However, one problem is, and i'm going to skip ahead here, a little bit. One problem is um. Here's the balance uh of what the options are standing were at the end uh of 2021., there was 349 million uh options, outstanding numbers being coming down and a lot of were exercised, we're probably going to be seeing a higher.

This is my expectation. This is going to be an interesting thing. We might not see it in the actual results. We might have to wait until they publish the uh, the quarterly report with the sec to get this data, but we might see an increased number of shares being pumped into the total and therefore perceived dilution to be higher than it was.

The reason for that is as the share price tanked and, of course, it tanked even more in q2, so perhaps some people waited even longer, but as the share price tanked through q1 considerably, there is a chance that some of the employees will have been converting their Options to shares, because you have to pay tax on the difference between the current sort of it's not exactly like that. But the current share price and what the stock option that you kind of got it at as an employee and remember. They only went public in 2020, so a lot of people are holding shares and uh investing them um and then are able to convert them whenever they want. So if they um go and um convert them there to pay the tax on the difference and if the difference is lower, they have to pay less tax.

However, those people are probably going to be exercising. Lastly, small amounts of shares because the senior management who hold the bulk of those uh share options and when they convert their shares, they have to sell shares, usually generally as part of the exercise option, because then the the numbers of shares that they sell cover the Tax and in that sense it doesn't really matter at which exact point you go and do selling of the shares, because the 40 or whatever it is, is going to be, like 40 of you know, like a small amount or 40 of the large amount. The number of shares you have to sell to pay that 40 is roughly very you know it's going to be roughly in the same ballpark, so unless they have a huge amount of money, um hanging about um, that's not going to affect things. Let's just see.

If the numbers have come out, uh not yet uh, i just got all these windows open, uh, nothing! Yet, okay! So let me let me go through quickly, just a few, so just just as a reminder uh just as a reminder. Uh i'm doing this somebody's saying. Uh, my mic is not not that good uh. The mic is usually good in my videos, but this is the first time i'm using this particular bunch of combinational software for a live video.

So maybe it's not not as good as it could be. Uh. It's a uh, we'll we'll figure it out we'll figure out in time all right. So so, in terms of some of the other points that i wanted to to go and look at here, we've got the operating um activities uh coming in at 330, 3.8 million dollars for 2021.

We're going to be interesting to see they, they publish a chart, and i don't have it open at the moment they publish a chart of what their non-gaap and their gaap margins are um. Actually, let me see if i can go and dig it up um, but one second, so i'll show you that in the presentation this chart that i think is going to be very important to look at one. Second, all right, so there's going to be a chart in here that is showing. Where is it not this chart uh this chart, there's going to be a chart here, uh, which is showing their non-gaap um adjusted operating margin and the gap operating margin, and the non-gaap is basically like here - is the operating margin.

If we weren't dishing out a whole load of shares and a few other small adjustments, but mainly the shares bit - and here is the non-gaap and the not sorry - and then here is the gap line and the gap line has been climbing, climbing climbing towards the zero Mark because, as they've been uh publishing as they've been selling uh or giving out all these options that were converting into shares, the proportion of that activity out of their total operating income has been dropping, dropping dropping, and so the interesting thing, as you can see, he's Been climbing quite substantially, so it is possible, especially if there was quite a lot of activity with new government contracts being signed urgently with us with other european countries. It's possible that this number, this, like minus 14, that was in q4, is going to be getting relatively close to zero, and this chart wasn't in these presentations before last quarter. The indicators for me, because they chose to publish it, is that they are expecting this chart to start getting to zero or close to zero on the gap basis in q1, maybe q2 q3 um and you can see like the progress just over the last year, has Been quite phenomenal on that front, so once we get into operational profitability, that's still not fully costed profitability, because remember, there's going to be a whole load of adjustments and that those adjustments are going to be driven by the spec right downs to a degree uh. The investments that they've had one second we've got any uh any any data yeah.

If somebody spots the results coming out, please do give us a shout so that i uh i can see nothing yet nothing. Yet i'm not seeing anything yet all right, so um. What else here are the investments that we're going to be looking at um? The investments here, total 326 million uh dollars as of the end of uh q4, and there's a bunch of these companies a lot of them very early stage. So some of these companies uh i'm not sure what number i haven't uh in a little while some of these um companies are companies that palantir actually works with, so they are clients of palantiy, but parents at the same time invests money in them, which is a Sort of unusual and somewhat odd relationship where he's kind of like investing you're, giving the company money as an investment from your cash pile and then charging it back through revenue through charging them for the services and then hooking them for uh, it's kind of a.

So it's a it's a weird two-way relationship there, but that's what it is and this investment has been relatively new, that a lot of this was coming during 2021 uh back end of 2021. um. The problem is if we look at um the further down on page 120 of the report, you'll see here that it says multiple securities consist of equity securities and publicly traded companies recorded fair market value. Each reporting period, blah blah blah during the year, ended december 31st.

2021, the company recorded net unrealized losses of 72.8 million and remember so the sell-off of these early stage. Growth stocks in general kind of started like mid november, maybe early in the first half of november. So there was a bit of a write down, but that really accelerated and continued through q1 and actually in the last week or two it's got considerably worse. I mean it's been gradually, you know going down.

So, let's see what what the unrealized losses on this are because they're going to be coming through in the p l and we're going to be seeing um that in the post, operational adjustments, so we'll see how big that is and how much of an impact that's Having um by the way, if you're, just joining uh the live stream or welcome, we are going to be covering the results, live as they come in. They can come in roughly this time, um in the last two quarters, which is why i'm here, uh waiting for them to come out the earnings score is going to be coming a little bit later. It's coming at 8 00 a.m. Eastern time, which is in about an hour and 15 minutes ish from now, but generally they give people a little bit of time, especially with questions and stuff like that to prepare, we are going to be covering the earnings call live as well.

I have it open over here here we go uh 9th of may 1. This is uk uk time 1 pm. 8 8 am eastern um. I'm surprised they haven't come out yet kind of kind of want to see the results.

Uh, it's a little bit of delay. Where are they um? What are people thinking? Are we going to be seeing so likelihood is there's going to be it's going to mix back, because i'm expecting that, potentially without the events of russia invading ukraine, we may well have had a slight miss on the court just because i am not sure if the Sales staff would have been ramping, the commercial side fast enough, and the government side was naturally declining kind of losing uh losing value um. However uh. What? When we're, when we're going to be looking at the data, we're going to have this artificial, one-off bump, which which potentially it's a one of bump, however, what it may do is give if we're seeing this bump through the whole of this year, for example, starting with The end of q1, if that bump translates into government revenue having an uptick that may give them that sort of bridge that they need uh to give them two or three quarters for the commercial revenue to start really pumping, and that might be really really good for Shareholders because, although they'll probably like whether the dip, naturally anyway, switching from mainly government income to sort of mainly commercial income at some point in the next two to three years, that may give them a little bit more of a of a ramp of extra government revenue.

While the dip is happening by the way, if you haven't been paying attention, if you've been living under the rock, the markets are incredibly low. What is happening uh one? Second, let me find uh what's happening in the pre-market, because it is, it is horrific. Let me just stick it on here: uh. What have we got? Uh everything is is down.

Here are the most popular stocks. Uh palantir is uh trading slightly up has something happened. Are people expecting something the market is down? Is the results come out or are people just expecting are people expecting good results? Is that is that what it is uh, i'm not. I'm still not seeing anything.

If somebody, if somebody sees something uh, give us a nudge in the chat, uh be quite useful. Let me just stick uh one. Second, let me i i i'm trying to figure out how to how to get your chats better. Here we go.

That's better! That's better! All right! Okay, uh where's the data, because otherwise i'm gon na ramble and we're gon na go off topic. I'm gon na stop all right uh. We are going to go and have a look at a few other things that i wanted to cover before the results come out. Okay, so i'm going to be i'm going to keep refreshing this every now and then but um one interesting after you look at the investments and after you read the fact that they wrote off 73 million, which is quite a lot, if you think about a company That is only making like 400 million a quarter writing off 73 million just on those investments in last quarter and probably more than that.

This quarter is relatively painful for your um bottom line. However, these are unrealized. These are paper losses right uh. This is not something that really affects the uh, the the total in any real way, so um.

One quite interesting thing is: if you scroll down over here uh, where is it you'll see you'll see uh. There was a few controversial things: uh plans they did last year with their cash uh. One of them was, they bought a whole load of uh gold in literal, gold bars, um and gold hasn't really been doing very much, so they were buying it sort of through q3. I think it was a current number um and it's sort of roughly in the same place maybe dropped a little bit.

But so there's not very much to talk about on that um options we just covered and yeah so uh, one of the most important things and i'll show you this in the data one. Second, the results out results up no uh, one of the most important things as well is watching what the international mix of revenue revenues, because the us numbers have been doing quite well. If we, if we look at the um, here's the the commercial momentum, you can see the commercial momentum building um over here, so it's like 19. 28.

37. 47. So this is, this is the bit we we want to see, uh growing a lot more and the commercial customer count is growing the thing with commercial customers um with with a company like palantirs. They typically tend to start low and then grow.

So it's like a low and growth strategy where often some of the initial stuff is done for free or there's an initial test, trial period or whatever, and then that kind of takes hold and and and there's a progress. But what that means? Is you often ramp up the customer numbers, but that doesn't necessarily translate into immediate revenues? Um. You can see here the u.s commercial momentum, so the u.s part of the commercial has been absolutely exploding, so you can see the overall is growing by 47, whereas the u.s commercial is growing 132 in the last quarter, and so to me the interesting thing is going To be, are we going to be seeing more international look? Palmetto does have a slight disadvantage like uh, maybe maybe not so much of a disadvantage. Now, now that we're seeing uh now that we're seeing what's happening, um uh with the global security situation, the russian invasion, the the the kind of threat of the taiwan invasion in china as well um is their global market, is a little bit more restricted right.

So they're not going to be selling their software to russia. Ex-Ussr countries they're not gon na, be selling it in china. They're not gon na be selling it in the middle east. I'm gon na be selling in a whole bunch of places uh where you know a general online software like microsoft or apple or whatever, like those guys, will be earning revenue in all these different countries.

So they have a slight bias, naturally as a company because of how they operate and what they do towards the us. However, in terms of just spreading uh, their risks spreading their ability to grow business, and you can see here that they've been hiring a whole lot of head count. This is the bit i was referring to. A lot of.

This came literally like right at the end of the year and 10 year. You can see 10 year less than uh 10 year. Over nine months was only 25., so you can see like they've, only really recently started. It's gone to 80., so they hired a bunch of these people um during the last half of the year and uh.

This is a really interesting shot being to see what the new version of this chart looks like have we got it, we got it. No, we don't um um. This is the job where they show you the revenue by cohort - and here is the the really interesting thing like uh this business isn't quite as sticky as some. However, um look at the 2018 uh numbers.

This is the 2017 and before going so, this is potentially some really old business, because parents have actually been around for a reasonably long time. They only went public rallies very recently, but they've been around for a little while you can see that the older cohorts dropped in 2019 dropped in 2020, but then suddenly picked up a little bit of pace at black bar. It grew just a little bit right. Let me zoom in a little bit more here um, but then, but then look at the newer cohorts.

There's a trend here which is really really exciting, because the older cohorts, maybe the sort of software they were set up for maybe the sort of uh contracts they have whatever, like they're, very outdated right. We're talking like five plus years in terms of when these customers were first onboarded, but look at the 2018 2018. This dark, darkish gray bar started off. Seven then went to ten.

They went to 15, they went to 17.. This is amazing for a company like this, where that's why i was talking about the low and gross strategy, like those guys turn up, then earn more money than earn money more money. Some of them will drop off, but those that don't drop off they will grow. They'll use more services sign up to new contracts, et cetera, et cetera, there's a bit of growth, seven to ten to fifteen that but then look at the newest cohorts.

2019 started with 19 million. They went to 69 million, they went to 102 million, so this is um a really really interesting thing, because when you begin analyzing these numbers um. This is a very prominent sign of non-linear growth that the company is experiencing. Have we got data yet? Where? Where are the results give me the results come on come on, you publish them early every other year, every other quarter, not today.

Okay, so let's talk about it. So q1 is growing very, very fast, and the non-linear effect here is because um, if you book a customer during say 2019, so you've invested in the upfront. You know the marketing the onboarding, the initial work that was potentially not revenue generating or not generating as much revenue. You earned only 19 million during the year right, but then look these guys that you've booked in this year then go and multiply their their earnings.

So each cohort so each like annual cohort um that you book uh nine more minutes, maybe but last last time they came out at uh. I think just after half fast so um anyway, um so um, each subsequent year or subsequent quarter. The amount that you earn from those guys is increasing, so um you get that additive effect where today, you're buying more cohorts and those cohorts this quarter this year may not earn you as much. However, when you look into the future years, they then begin adding up because next year or next quarter, you're going to have more revenue to spend on marketing activities on sales staff and all of these kind of things, and that will generate more new customers who don't Immediately earn either revenue but then start earning revenue down the line, and this is why you see this like look at the totals 39 to 48 to 99.

This is u.s commercial revenue by cohort um, but but this is the impact that you're going to be seeing across, potentially, hopefully, hopefully, non-us commercial revenues as well. We're not seeing the same sort of granularity of data, but this is where the real money in the long term apparently financially really wants to go and deliver um the sort of stuff they want to deliver the results they want to deliver the sort of revenues they Want to deliver this is what they need to grow right. They need to grow the commercial side of the business. The government revenue is going to be limited, especially for paladio, where you know that they have a reasonably large chunk of a lot of the us military and other government, uh bodies and organizations in terms of contracts already and sure that might increase by some amount.

But there's always going to be a bit of a limit if you're just joining um, the earnings should have come out, or i expected it to come out already by now, because in previous quarters they were already out by this time. However, the earnings score is in just over an hour and they tend to release results sometime in advance. Some people are saying: maybe it's going to be in seven minutes time and the hour strikes uh we shall find out but look but then look at the more recent cohorts. So the 2019 went from 19 to 69 to 102..

Then look at the 2020 cohort. It went from 6 million over here to 53., like if you look at the relative, multiple, so 19 went to 69 61 to 53 and there is every chance that as we're progressing through the year that 53 so look 69 like got another whatever. It is. 70.

80, on top, if this kind of goes to become - i don't know - 18 100 million, then if we book another whole load with these new sales staff. So if the new cohort in 2022 is not 19 million or seven million or six million, if it's more, like you know, 30 40, 50 million - that non-linear effect multiplies that number considerably in terms of what you're going to be, then seeing bill come through as uh Revenue in future years - and that's for me - is where it's very very, very exciting, with penalty, because a lot of people can look at their business model from top down view and kind of say, okay government most of the revenue is coming from government. Therefore, that's their primary business. Therefore, it doesn't really matter.

You know it's a hypothetical, it's a speculative kind of bet on expecting the commercial growth uh to outpace uh, the government growth in the long run. But for me the reason that i am invest in balances. One of my positions in my portfolio i'm invested in is because i'm seeing these signs of non-linear growth and that's the kind of thing that i really like, like my kind of sweet spot generally for investing in companies, is before they are turning fully costed. Profits like in terms of their p l in terms of the stuff that wall street goes and likes and reacts to before they get positive gap based earnings per share and blah blah blah and people like then qualifying them as investment grade and all of that stuff.

Before they get to that point, when you can see a lot of the data, a lot of the information uh that is showing you so the downside, potentially this quarter - is that, if we're looking at the government uh, whereas non-us commercial, non-us commercial growing very slowly, this Is where the sales staff need to come in, but look at the government business. Q1. 76 percent. 66.

30. 40. So we saw this massive decline in the growth. So this is not a drop right, but the rate of growth has been slowing, slowing slowing quite considerably, and this is the bit.

I think, where uh the biggest question mark for whether the q1 results are going to be good or not, is going to come in uh, let's see still nothing, maybe they are going to be publishing on the hour which we'll find out still nothing okay. This is the bit where we're really going to be seeing the most um, like that. Probably the number that's going to drive the overall number the most. How much has the government revenue uh growing by? Has it continued down the shrinkage route or are we seeing an uptick here, um government cohort growth, it's the same sort of chart that we were talking just about before, but you can see that the multiples here are not quite the same.

Look at it. The old player courts, yeah they're kind of like growing steadily, but they're not having the same uh multiplicative effect, the 2019 cohort did it right and the uh sorry. The 2019 went from 2 to 18 to 43. These are good.

The newer cohorts, the older cohorts, not so much, but you can still see the same. You can see 8 million over here, booked in 2021 and last time they booked 18. That then became 227 in the second year, so it could be backloaded, so it could be that a lot of the 2020 government contracts were backloaded and therefore they can earn majority of their revenue and eight million that they pocketed from the 2021 cohort is less than The 18 here, however, look at 2019. They booked just 2 million of revenue from the 2019 cohort within 2019, but that then, two years later, uh was 43 a 20 times multiple on the initial revenue that they got during 2019..

So the that kind of longevity that kind of long-term nature of the contracts that these guys get even within the government cohort are really really interesting, because a lot of people say: oh well, the revenue might drop this year, i'm looking at going. They probably don't even like, even without signing any new customers during 2022. The revenue should continue going up based on all of this data because look the new cohorts within a year. Here's the government, like eight, it's almost like negligible.

It's almost like in the first year, you're just doing the initial paperwork. The initial onboarding, the signing stuff to getting people comfortable with the systems integrations migrations, blah blah blah all that stuff. It doesn't really earn revenue. You start earning revenue next year, the year after the year after that, just look at the dark gray from 2018, so 31 61 double 199 almost three times on top of the double so we're talking six times, multiple plus then another big bump to 282.

So these are cohorts that are older, um and potentially you know there is a counter argument here, where the older cohorts are potentially going to be the lower hanging fruit. So you know you're going to sign a big deal with the us ministry of defense, and you know you get a bigger army contract or a big border force or whatever it is. You know you can't just go and pick those kind of contracts up every year, because you know once you've got the low-hanging fruit, the really big guys, and then you begin squeezing all the juice out of them. That probably is kind of roughly where you're going to be maxing right.

You can't just go and arbitrarily go and pick up those kind of ones all the time. However, the data's indicating that they're continuing to pick up new contracts, so it varies year and year, right 31 in the latest uh of 2018 cohort within 2018 down to two in 2019, but then up to 77 and then down to eight. So you can see this. It really depends when these contracts are being signed when they're starting a whole bunch of stuff.

However, the thing that doesn't really change is what the long term uh trajectory on them is. You can see. 2019 cohort is a bit low because they're only starting them two. So being see, if we get any data like this on the quarterly basis uh in in the reports uh, because we get some kind of quarterly data and we begin seeing that the new customers coming in are generating reasonably decent revenue.

You know like several million rather than uh sub 1 million, which would be putting them on this sort of trajectory. Then they're potentially going to be in the money on this one in terms of what the next two to three year projections would look like. I'm still not seeing any results. Oh come on.

Let's have a look. We've got nothing sometimes with these with these, you can go and alter the link and get the results a few seconds before they update the page, but the links are all customized. I'm not going to be able to get that. Okay, no, nothing in there.

Yet all right um, if somebody does see the results, uh we're an hour out we're now where, where are the results, give me the results? Um, i don't know okay, so so, let's talk a little bit more about um, uh, the p, l and and what to expect uh because one second, let me scroll up to the p l, so we can all look you're looking at the same things um. This is last quarter's, p, l uh, because the new course results have not yet come out we're here, waiting um. So in the last quarters, p l, where is it uh too many tabs open there? We go um in last year's p and also i've got the the angular stuff open um. The the one thing that wasn't uh around much last year that we're going to be seeing a lot more this year is this line over here.

So you can see, we've got an a net loss, which is 520 million, but the um loss from operations is only 411., and this is where we're going to be potentially seeing this line over here, the other income expense net. This is the line. All the investors are fretting at you can see in previous years in 2020 and 2019. This was a negligible line, so it's like finance stuff, like loan costs, et cetera, et cetera, et cetera.

It's out, people are saying he's down four percent, i'm not seeing the data. If somebody, if somebody has the data, oh here, we go revenue, growth, 31, let's have a read and then hopefully the other the presentation everything else are going to come out and sex. So total revenue grew 31 percent year over year to 446 million. That's slightly ahead of their guidance uh, their guns was just about 30 percent, but basically on par commercial revenue grew 54 percent year-over-year, and this is slightly up from where they were the growth that we're just looking at and u.s commercial revenue 136, which is a very High number, however, remember that these, in terms of the relative increase on the same number from the last quarter, so let's go and look at the commercial revenue up here, uh that we were seeing last time around.

So last time u.s was 132 and the total was 47. and you can see was ramping considerably. The problem here that people are the investors are going to be looking at firsthand is the rate of which these numbers are growing, has sort of like slowed down a little bit on the commercial front, so we're not seeing the benefit of these extra sales staff coming Through just yet because a lot of this growth in revenue is probably going to be the older cohorts boasting revenue, we're not seeing many new contracts based on this, i'm guessing government revenue grew 16. This is a really big problem, so that thing that we discussed earlier, where we were saying um that the government revenue is potentially going to be the things going to be propping up if they're selling a load of contracts because of what's been happening in ukraine, etc.

But that's not coming through at all in q1 and maybe you're going to be seeing this in the customer count on the government side. So customer count grew 86. Year-On-Year we'll see you later on in the presentation as to what that means in terms of the breakdown, but this is a very disappointing figure and as an investor, this is the one. That's really bothering me because the commercial side is growing, but not growing as fast as i think.

A lot of people wanted them to grow and the government revenue has continued at the decline. Remember that it was already down to 26 percent quarter, uh uh year-on-year growth. Last quarter, um and people are now saying. The share price is down four percent: five percent uh down to nine dollars, maybe going to eight dollar territory.

So this is pretty bad, uh, so uh what else loss of problem operations? This is relatively meaningless, but minus 39 million, which is interesting because uh, i'm guessing imagine of minus nine percent. So remember the last quarter. It was minus 14. So imagine of nine.

Is that that's reasonably okay, given that the revenue hasn't grown, all that much because they're getting closer to that zero mark and we're going to be seeing those charts in a sec adjusted income from operations, 117 million margin of 26 that is lower than it was before? And they have been hiring extensively spending a lot of money. That number was hovering around the 30 31 mark beforehand. We're going to be seeing that in the presentation as well, so that's dropped a little bit so so we'll see what's happening there. Is it the people exercising those options with a low share price, possibly um? The earning score is going to be in an hour, so hopefully we're going to be um in for some really tasty, interesting questions.

Uh we'll come to that um. When, when that happens, i just had free cash flow 30 million dollars representing a 7 margin um. Let's look at the p l, so first quarter um revenue 446. Is there a comparison table further down? Here we go 446 million uh, which is the 31 uh.

Cost of revenue has climbed quite considerably. So this is. This is the first obvious problem. The cost of revenue grew what what is it 944, divided by 74, 1 27, so like slightly lower than the the revenue that has been generated, but the gross margin you know is is continuing to be relatively flat, uh based on this.

So, potentially some you know, benefits of scale. Uh should be eventually coming through here. Well, some include stock based compensation. Expenses follows cost of revenue and the stock based compensation has dropped.

In fact, before we get to the rest of numbers stock, subways compensation is dropping and wasn't uh huge 150 million, so a drop on uh the same uh period last last year, uh that's gon na that that's kind of good. I guess like takes the edge off some of the other stuff a little bit. People are saying it's minus twelve percent. Already, oh, my god.

This the numbers are not good uh. The numbers are not good. Let's have a look at the rest of it. Sales and marketing 160, 88, so r d uh dropped uh the same uh time last year, which is interesting because they've been investing so much money into all these new platforms before their commercial uh customer base grows it's kind of like, like as an investor you're.

Looking at this and you're kind of wondering, maybe in the presentation, we're gon na be seeing some of the details, but like is this: is this the right time to be investing less uh? General admin has dropped a little bit as well, so the cost base uh is the overall is doing really good after uh the gross profit number and that's what's driven this uh better number on from from a lot of operations. But the thing is, this doesn't really matter right at the moment that that operating figure is can be artificially moved up and down, based on a few factors, and you can see that um there's a 50 million drop over here. 54 million drop from same course last year on stock based compensation. So when we're looking at 114, going down to 40 53 of that uh so like the the bulk of it is from the drop in stock based conversation, the rest just uh natural drop, all right.

Uh, let's see if we can get the presentation, because that's where the exciting numbers are going to be at uh share count. Uh grew a bit not as much as last uh, not not not not very much actually because, as of the end of last year, uh. What was the stock based uh? We were on diluted, 1.923 uh, that's not the closing, though, is it oh? Where is the closing number? I had it somewhere uh. I can't see it.

I can't see it somebody if somebody knows it off the top of their head, but didn't grow didn't grow as much as it has been in recent quarters so potentially like some some benefits there on dilution gradually slowing down, which you would naturally expect anyway. Okay, let's go and look at the presentation see if we can see the presentation. Is there anything else that we're seeing on the guidance here where's the guidance okay outlook for q2 we're guiding to a base case of 470 million in revenue uh? There is a wide range of potential upside to our guidance, including those driven by a role in sporting, developing geopolitical events, um. So they're saying that, potentially because of what's been happening in in the ukraine, there is an upside uh.

That's what this is not saying, but but it's saying where a whole bunch of government contracts are going to be signed, they're going to be delivering revenue starting next quarter, um, i'm guessing that! That's that's the interesting thing: adjusted operating margin of 20. Now that is uh, that is a problem uh. What what what's causing that to drop uh what's causing that to drop so substantially like the cost increasing? What is it we'll have to find out for four year 2022? We continue to expect adjusted operating margin of 20 and annual revenue growth of 30 greater through 2025., so okay uh, the earnings score, is going to be starting in 52 minutes. Let's go and find that, let's see if we can get on a presentation still not up here, come on, we've got to have the presentation somewhere come on.

Give us a presentation. Has anyone got the link to the presentation anywhere? I want to see. I want to see the slides, i want to see the slides uh they publish this, but not not publish the slides. Yet, let's have a look at the balance sheet um because that might give us a bit of color on what's happening with their investments.

Um uh cash position hasn't really moved very much very, very little movement over here property equipment there, yeah okay, there's like no movement at all in the assets really on the liabilities front, current liabilities, bang on the same uh, very non-eventful, actually not seeing any movement. Like look, look look at these lines: they're almost identical um paid up cattle, so a few shares been exercised collected a few dollars from that um at the whatever 4.65 or whatever. The share that the latest value uh plan is yeah, not very much. Let's look at the operating um side of things because that's where you're potentially going to be seeing some interesting stuff on the real operating cash flow and we are seeing um net loss uh for the three months.

Uh ended 2022 minus 101 million uh starbase conversation 149.. So blah blah blah changes, not bringing assets and liabilities accounts. Receivable uh, oh accounts, receivable dropped massively, so accounts. Receivable is the money where you have invoice for the services, but the money hasn't really been paid.

Yet so, in terms of, like p, l, you've earned the revenue because, like the invoices have gone out, i'm simplifying things a little bit here, but the cash hasn't turned up um so uh, sorry so, but the cash has not turned up that. That's the definition. We can see well, however, here we're seeing that potentially next quarter, there's going to be a little bit of pressure on revenue so on the cash flow side of things, because the there isn't an overhang, so you can see there's a big drop. There isn't an overhang of a whole load of uh money, uh waiting to be collected uh.

What do we see in accounts payable? Also a drop, maybe they've just gone to faster payments with both suppliers and clients. I don't know um. What do we see in customer deposits current account? So, okay, so maybe maybe that is what it is, because you can see the customer deposits number has jumped up massively as well. So this has just gone from accounts receivable to customer deposits of people like doing prepayments, from which their money's being drawn down, possibly um.

Let's see investing activities purchasing multiple securities they've been investing in something uh, another 89.5 million dollars there and they sold some smaller portion or something they made money on something so one they made money on something they sold wow in the last quarter. Who else sold some of the stocks for a profit in the last quarter? Put your hands up purchase of property and equipment, 15.2 million wow? What have they been buying uh? Is this like some kind of giant data center? That's like a reasonably large amount of money for a company like palantir to be spending on um. I don't know. Does somebody know uh? What have you been investing money in uh a few dollars from this yeah, not not very much to talk about um? Is there anything interesting in the adjustments? No just stop-based compensation um? What is what is the balance here share price doing in pre-market? Let's have a look: minus nine percent - oh dear, oh dear, if you're a parenting investor, this doesn't look good, we're way below where they went public.

However much the company is doing better that. But this is an interesting point point that i really really have to make. Remember that these are short-term perturbations and the majority of the price drop that we're seeing uh with palantir, just like with most of the companies, is driven by microeconomic variables that, in the case of planetary in particular, it's relatively immaterial like to some degree um, because, typically The contracts that you sign with government entities, long-term contracts do have provisions for baking and increases due to inflation stuff, so in terms of their future ability to earn revenue, profitability inflation's not going to be necessarily a huge factor in it like if the value of money Depreciates future contracts is going to be priced in new dollars rather than all dollars and old contracts are going to be repriced, so um, i'm not necessarily seeing what the downside is ah come on. Give us give us the presentation.

Somebody has a link to the presentation. Uh 2022, no, no, i'm not going to be able to it. Somebody has a link to the presentation for the new one: 20. 20 uh.

No, i'm not gon na be able to play around with that. If somebody's. If somebody has a link, please let me know or send it to me or something um, so so the numbers uh just to highlight before we get to go and see the presentation, because they're a bit slow with the dating stuff today. Aren't they um? Is it in the vents, no okay, so the headline numbers before we go and look at any of the specific details before we hear alex carp? Hopefully uh not have another disaster setting school that too many schools ago.

It was absolutely horrific. He wasn't on the call and people thought that was going to be a lot better and because he wasn't on the call uh, whoever was doing the uh. The presentation did this, like overly it kind of felt like a sales pitch like a sort of an a 40 minute, long sales pitch for palencing, and it was just woeful. It was just it.

It wasn't like an early school. It was like you're watching an ad for 40 minutes, and then they changed it up and they went exactly the opposite way. Last time around and last time alex scott stood up and it was just like it was filmed on a potato or something like that. Um, even even worse than my filming over here and uh, he stood up and talked somebody's saying, alex karp is not going to be on the call and he spoke, but he said a few things that were that didn't really necessarily help and they didn't answer.

Some of the questions very well at all, so we'll see we'll see what they're going to be doing this time around they're, clearly trying to figure out what the sensible way of doing these earnings causes, but in terms of headline numbers before we go in um on The good side - uh 31 percent - is british bang on what they were saying in advance to targeting 30 revenue. Growth is pretty much bang on uh commercial revenue continues growing. However, the pace at which the growth is increasing has slowed down a little bit so when we saw um the commercial revenue and the u.s commercial revenue kind of explode, we're now going to be seeing both of those curse flatline a little bit so they're still growing. Like 54, year-on-year is very, very good in the grand scheme of things.

If we take a step back out of the exact current situation, if we take a step back from what we're seeing in the markets, what we're seeing in terms of expectations 54 for overall commercial revenue is great u.s commercial revenue, 136 great both of those numbers are Higher than they have been in recent history, if you look at the recent um cohorts from the past presentations uh, where is it here's the commercial momentum? It was 19, 28, 37, 47 in the last few quarters, and now we're seeing 54 and for the u.s numbers. We're seeing 72 1900 332 132 has become 136, so it's still increasing. So it's still good. If you kind of like get your mindset uh into some kind of realistic numbers.

However, we're kind of seeing potentially a little bit of a flat line and remember that this revenue is probably not including any of the benefit of hiring all of these new staff um over the last few quarters. The share price is down 11, so we're seeing just a lot of viewing people are getting these numbers, and the reason i think for me is is look at this. The golden revenue has only grown 16 year on year, and this like it's one of those where the invasion only starts on the 24th of february. So sure there wasn't a very long period of time during the quarter up to the end of march in which to score contracts.

That would then yield you revenue during this contract and that's where the presentation, if we can see idiq awards in there, they haven't published them in the last two updates. I think they did before uh that'd be interesting, but potentially maybe we're going to be seeing some kind of like government contract numbers or some other chart where we're going to be seeing uh those those numbers come through. Like that's going to be an indicator that hey that revenue is coming and potentially maybe second half of this year - we're going to be seeing the benefits of that and they alluded to it in the guidance they were saying: hey we're in the guidance. So so they saw people are going to have an issue that they saw.

Hey people are really concerned. Look, the revenue is growing the commercial side kind of like flatlining, but doing quite well flatly not flatlining in absolute terms, flattening on the growth rate, but the government contract there's a problem and they kind of thought immediately. Okay, well, people are going to have this issue and naturally, look at this. People are having this issue right.

Stock is down 12 percent. However, you're going to look at the numbers and saying okay: well, we anticipate that you're going to have these problems, but we are still saying that the base case is going to be 470 million dollars in revenue for q2. And if we don't look at valencia's quarterly revenues 470 divided by what is it uh, q2375 uh there's going to be 25 percent rate of growth and hey? This is what they're saying so we are guiding for 470, which is only 25 percent uh growth. So, although this this quarter, we did 31, what we're saying is, in h1, we're expecting the growth to slow down to below our 30 target, and the problem that people are going to have is hang on if you're as a company, where the majority of your revenue Is coming from, like defense and from military spending and from government contracts, if you're not making bank during the first two quarters of this year? When are you going to be able to make bank because, in terms of signing contracts in terms of earning revenue, this is going to be the investor mindset right? When are you going to be earning the money because hey if this thing subsides or when this thing subsides, hopefully right when this thing subsides, like if you're not making bank on the contracts now you're, probably not going to be making bank then? And then it might? Look even worse and they've been recently publishing, and this is another thing.

That's a bit concerning to me as an investor because a lot of people on twitter and other communities and stuff like that they're going to look at the news and they're going to say. Oh look: palance is selected for 90 million five year nhs hhs contract, blah blah, there's a bunch of these different uh news and people go and wax lyrical about how amazing it is. I'm, like that's, not very much right. This is over five years, this company - that's making 430 million 440 million dollar dollars a quarter.

90 million over five years is like a drop in the ocean, and the fact - and this is this - is to me as an investor when i'm looking at these numbers, they're slowing in growth and i'm putting in conjunction with all of this kind of news. I'm like wait a second you're making a really big deal out of this, like 90 million over five years, so 90 million over 20. What is that? Four and a half million a quarter so you're making a whole press release you're very proud of the fact that you've got the contract, which is worth roughly one percent of your current revenue and to me i'm kind of looking and going. Why am i not seeing the same kind of news updates about much bigger deals right so, if, like you're so excited about one percent, so look uh, i'm looking at the news, i'm like okay, so one cent over here showcases, so some new products are very exciting.

If you didn't see that presentation, you didn't miss very much, it was like a seven minute commercial or something, but then they announced results and they're. Looking okay long, they renewed a contract uh with the government. Great uh, that's very good, but not seeing very much specifics. Where are the commercial contracts unveil new products? Oh another new product, stuff, okay partners with a company to broaden research and us government market analysis is not so there's a whole load of news.

I'm looking like back to okay march uh president we're gon na present the morgan standard technology, blah blah blah cdc, but i'm looking at going in since the last earnings call. They got one piece of news about a commercial client which, and i'm i'm aware that many commercial clients, for example, don't really want to publish and there's a bunch of news around the last quarter - ferrari et cetera, again, very small contracts, so i'm looking at going well. It's very exciting because i can see that your commercial contract value is growing, but it is probably growing because what we're seeing before through existing customers spending more money with you not through new contracts, and that's, maybe not certainly a problem this year, because this year the Majority of the growth is going to come from all the contracts because we saw before the customers on board during the year. Don't really earn very much money, but the problem we're going to be having potentially is when we're seeing these customers next year.

That you're asking so, if you're a long-term investor, this is the kind of worrying thing that you're going to have the top of the head. You're like: where are the contracts? How come like since the last earnings, the only contract we're seeing is worth about.