President Donald Trump praised Palantir Technologies (PLTR) on Friday, even as the AI company headed toward a sharp weekly loss in the stock market.
In a post on Truth Social, Trump highlighted Palantir’s role in military work. He said the company had shown “great war fighting capabilities and equipment,” before adding, “Just ask our enemies!”
The timing of the endorsement was notable because Palantir stock was heading for a 15 percent loss for the week.
This situation demonstrates how political support does not always lead to immediate market confidence, especially for a stock closely linked to government contracts and defense spending.
Palantir’s role in current military operations
Palantir’s technology is reportedly involved in current U.S. military efforts. The company’s Maven Smart System, an AI-powered platform, helps identify targets in the Middle East.
Palantir’s system is connected to operations related to strikes on Iran that started in late February. More than half of Palantir’s U.S. revenue comes from government agencies, including the Pentagon and Immigration and Customs Enforcement.
The company has secured fresh government contracts and expanded its work with the Pentagon since Donald Trump won a second term.
Over the years, Chief Executive Officer Alex Karp has openly backed the U.S. military and the goal of giving warfighters the best tools available.
Although he previously criticized Trump and donated to President Joe Biden’s campaign, Karp has more recently shown support for the current administration and its policies.
Because the company is so closely linked to the federal government, the president’s words can have a lot of weight.
Palantir Technologies makes software that helps businesses deal with and make sense of large amounts of data. Its platforms help businesses and government agencies understand complicated information and make better decisions.
Market skepticism remains despite political support
Not all market observers share Trump’s optimism. Professional investor Michael Burry, who inspired the film The Big Short, has publicly questioned Palantir’s valuation. He responded to the president’s post on his Substack blog.
Burry wrote, “Trump’s post rallied the stock after the stock had fallen 18% the last three days. The stock may catch a wind here. It has been selling off with software stocks.”
However, he added, “I continue to hold the puts, as I believe the fundamental value of this company is well under $50/share.” A “put” is a financial bet that a stock’s price will fall.
Some investors believe that the Iran war could help Palantir because it does a lot of business with the U.S. military and intelligence agencies.
Palantir also works with the artificial intelligence company Anthropic. The U.S. Department of Defense blacklisted Anthropic after officials raised concerns about the possible use of its tools in autonomous weapons and government surveillance.
Anthropic is “eating Palantir’s lunch”
On Thursday, Michael Burry said on X that Anthropic is”eating Palantir’s lunch”. He later deleted the post. Burry pointed to Anthropic’s fast growth to support his view.
He said the company’s annual revenue rose from $9 billion to $30 billion within months, while Palantir took around two decades to reach about $5 billion.
Burry argued that many businesses now prefer Anthropic’s simpler and easier-to-use artificial intelligence tools over Palantir’s more complex platform.
After the post, Palantir shares fell about 7 percent, wiping out over $23 billion in market value. This was not Burry’s first negative view of Palantir. He has criticized the company before and has also placed bearish bets against the stock.
Last year, Burry placed about $1 billion in put options against Palantir and Nvidia. The filing showed about $912 million in Palantir puts and roughly $187 million in Nvidia puts.
This led to a strong response from Karp, who described Burry’s bets as “super weird” and “batsh– crazy.”
Palantir stock swings after Trump endorsement
Palantir shares later recovered after Trump’s post. As of 1:53 p.m. in New York, the stock was down about 2.21 percent, trading at $127.60, after falling nearly six percent earlier in the day.
The episode shows how a stock can move in various directions at once.
Trump’s endorsement drew fresh attention to Palantir’s role in U.S. defense. This fall in the stock, however, also showed that other factors remain of interest to investors as well as valuation, sector pressure, and overall market sentiment.