Michael Burry Is Shorting PLTR: Why Palantir’s Earnings Next Monday Are a Make-or-Break Moment
Michael Burry is still short Palantir heading into Monday's earnings report, and with shares priced at over 120 times forward earnings, one soft data point could hand skeptics exactly the opening they need.
Palantir Technologies (NASDAQ:PLTR | PLTR Price Prediction) reports third-quarter results Monday, November 2, after the bell. Michael Burry is still short the stock, and shares trade at roughly 122 times 2026 earnings. This report will test whether the AI story can keep outpacing its valuation.
An Otherworldly Quarter Raised the Bar
Last quarter was Palantir’s best yet. Revenue rose 93% year over year to $1.935 billion, and U.S. commercial revenue jumped 149% to $764 million. EPS of $0.41 exceeded the $0.346 consensus. CEO Alex Karp called the quarter “otherworldly” after the Rule of 40 score reached 155%.
Management raised full-year revenue guidance to $8.150 billion to $8.158 billion and lifted adjusted free cash flow guidance to $4.5 billion to $4.7 billion.
Burry closed his Scion hedge fund last year. In September he sold his December 2026 Palantir puts but maintained short positions in the stock. Shares have gained 11.22% year to date to $197.70, a small move for a company growing this fast.
Wall Street Expects Nearly 85% Revenue Growth
| Metric | Consensus | YoY Growth |
|---|---|---|
| Q3 2026 EPS | $0.4118 | 96.1% |
| Q3 2026 Revenue | $2.18 billion | 84.5% |
| FY 2026 EPS | $1.6187 | 115.8% |
| FY 2026 Revenue | $8.22 billion | 83.6% |
Consensus sits above management’s $2.160 billion to $2.164 billion revenue guide. Landing at the top of that range would still mean missing expectations.
U.S. Commercial Growth and Margins Decide the Short Case
U.S. commercial revenue remains the swing factor. Management guided that segment above $3.424 billion for the year, which works out to at least 134% growth. Karp said he is driving the business to grow at a rate “equal to or above what we have in U.S. commercial for the next 18 months.” I’ll be watching whether that segment holds a triple-digit pace off a much larger base.
Bookings give the forward read. U.S. commercial TCV reached $2.132 billion in Q2, up 153%, and net dollar retention rose to 157%. Another strong TCV quarter would weaken the argument that demand is peaking.
Margins are the second test. Adjusted operating margin hit 62%, but management highlighted a significant third-quarter expense increase tied to new-hire seasonality and marketing. You should also look at stock-based compensation, which ran $265 million last quarter.
The outlook matters most. Palantir has beaten EPS and revenue estimates for eight straight quarters, so the market expects a raise. Any lift to full-year revenue or free cash flow guidance, plus early framing of 2027, will carry more weight than the headline beat. Options traders sound conservative too. The full-chain put/call ratio is 0.72, but mid-November expirations show ratios of 1.07 and 1.02.
Priced for Perfection Heading Into 2027
At 122 times this year’s consensus EPS, Palantir is priced for perfect execution. That premium is exactly what Burry is aiming for (riding an AI mania is one thing, planning the exit is another, and we covered both in a free bubble survivor’s handbook). Clearing the $2.18 billion consensus, holding triple-digit U.S. commercial growth and raising guidance again would weaken the bear thesis considerably. A result that only lands inside management’s range would give skeptics an opening. Next Monday’s report will decide which narrative carries into 2027.
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After two decades of patrolling the dark corners of suburbia as a police officer, Rich Duprey hung up his badge and gun to begin writing full time about stocks and investing. For the past 20 years, he’s been cruising the markets looking for companies to lock up as long-term holdings in a portfolio while writing extensively on the broad sectors of consumer goods, technology, and industrials. Because his experience isn’t from the typical financial analyst track, Rich is able to break down complex topics into understandable and useful action points for the average investor. His writings have appeared on The Motley Fool, InvestorPlace, Yahoo! Finance, Money Morning, and, of course, 24/7 Wall St. He has been featured in both U.S. and international publications, including MarketWatch, Financial Times, Forbes, Fast Company, and USA Today.
