$50mn SOMPO Expansion; Foundry Marketplace; $900mn Involvement? | Bullets #12

This week's Palantir developments and the crowned “Tweet of the Week”

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Emanuele Marabella

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PLTR 0.00%↑ this week:

• Sompo, one of the biggest Japanese insurance companies, announced a $50mn expansion with Palantir over 5 years. This expansion is crucial not only for its size, at $10mn/per year, almost 3x Palantir’s average Revenue per Commercial client, but also because it clearly signals that Palantir has achieved crucial milestones on the Real Data Platform project. Sompo initially partnered with Palantir in 2018 and remains their most important Japanese client.

  Mike @Mike09964617

  $PLTR Japan K.K. today announced a $50 million, five-year expansion of its work with SOMPO Holdings ("SOMPO") and its group companies including SOMPO Japan, the company's insurance business.This expansion will enable the roll out of critical workflows across 10,000+ salespeople

• Palantir held its third FoundryCon, the event where clients exhibit their experience and results using Foundry. Given the success of FoundryCon US in October (“we had overwhelming feedback”), there are chances Palantir could hold them again in April. Having industry leaders such as Tampa Hospital showcasing how Palantir helped their nurse staffing efficiency by 30% is the best marketing Palantir could seek to increase awareness. Palantir is clearly improving its distribution strategy which is its biggest obstacle to success.

  Palantir @PalantirTech

  "What we found was there was a 30% increase in improvement of nurse staffing ratios for those units that were on the system." - @TGHCares' CTO Brian Hammond on using #Palantir Foundry for clinical staffing. Watch the full FoundryCon stream: resources.palantir.com/foundrycon-23

• Palantir unveils Foundry Marketplace. Unfortunately, the stream of the launch is not available but in the past days, Palantir shared on Twitter a brief video I analyzed. With Foundry Marketplace, Palantir clients can become SaaS sellers of the applications they develop on Foundry. The potential of the initiative is immense. Despite the fact that we don’t know how this could be monetized, we can reasonably see how this could be a great catalyst to unlock further network effects between clients, enabling further growth. In August, I shared how Palantir should be seen not as a “Product,” but as an “Enterprise Network” (Palantir: the Biggest Networks Start Small).

• Palantir CEO hints at robust Q4 results. In a Bloomberg interview, Alex Karp hinted that the “US market growth is really impressive.” Before getting too excited, I remind you that a “good” quarter for Karp doesn’t automatically mean “good Revenue,” as his primary goal is increasing the number of clients rather than extracting the most value from them. On the other hand, sales from the International market seem to still suffer from adverse Forex conditions and relatively less focus in terms of sales effort than the US one.

• The new Prime Minister of the UK Rishi Sunak publicly endorsed Palantir’s Foundry role in improving efficiency. Is it another step closer to the $360mn NHS Open Platform deal? Bids for the contract must be submitted by February 9th. From a new article, it seems C3ai is also bidding for the contract in partnership with the consultancy firm EY. This is war. p.s. Epic Shyam retweet on @DailyPalantir’s post.

• Palantir seems to be used in Honduras since 2015, an investigation from Codastory reports. According to the article “Honduran police have run more than 12,700 searches through the platform since 2015 when the Palantir Unit started”. Great to know Palantir is active in Central America!

• Palantir wins an $8mn contract with the Australian Transaction Reports and Analysis Center agency until December 2025. Palantir is currently involved in different agencies in Australia, including the Criminal Intelligence Commission and the Department of Defence.

• Citi reiterates “sell” and further downgrades PLTR to $5. In May, the analyst covering the stock downgraded Palantir from $10 to $7. Palantir currently trades in line with the consensus fair value but shows a high divergence between the lowest price target of $4.50 (-46% downside) and the highest price target of $15 (+87% upside). Who is right? Time will tell, but my opinion is clear (Palantir Analysts are Wrong).

  

• Shyam Sankar changes the title from “Chief Operating Officer” to “Chief Technology Officer.” Other changes involve Chief Accounting Officer and Chief Revenue Officer. I don’t expect a major impact from the change given Palantir’s flat structure is similar to Tesla, but it could be a way to show Palantir has reacted to the SPAC mistakes, which we heavily discussed in the previous articles.

• Accenture Federal Services awarded a position on a 10y $900mn Digital Engineering Contract to support the U.S. Air Force Base Defense System against small unmanned systems to hypersonic missiles. Despite not having direct evidence yet, there are clues suggesting that Palantir could be potentially involved as the platform on which Accenture built their applications to win the contract: 1) Palantir and Accenture officially partnered in April 2022. 2)

  Palantir's Missing Link
  found an "AFS" active link. 3) Air Force is a crucial Palantir client. 4) the descriptions of AFS services perfectly match Foundry and Apollo capabilities ex.: the product is called "Skylab" which is the name of the service that empowers Apollo. Time will tell if there is more than speculation. Thank you @chrisj_128 for sharing it.

Related Tech trends/Macro:

• Fed raised 25bps and expects 'ongoing' increases. The slower pace of interest rate hike helped trigger a positive reaction in the stock market which benefitted Palantir as well. Palantir is now at $9: now what? I discussed this with @vinceisbullish.

• C3ai AI 0.00%↑ announced a new artificial product suite integrated with ChatGPT and other third-party AI products called "C3 Generative AI.” The suite uses a natural language interface to rapidly locate, retrieve, and present all relevant data across the entire corpus of an enterprise’s information systems. The stock is up +150% from the December bottom on the "AI" buzzwords hype triggered by the surging interest in OpenAI/ChatGPT.

• Microsoft starts the integration of ChatGPT into Word with a “Ghostwriter” Add-On. In the previous days, Microsoft integrated ChatGPT into Teams to unlock functionalities like “smart recap” at the cost of $7 per month.

• A Chinese Balloon suspected of spying on US strategic sites was shut down by the authorities. Will we see a tension escalation?

Tweet of the week

Yours,
Arny