Palantir Technologies (PLTR), the data analytics and artificial intelligence software company, fell about 7% on Friday, wiping out roughly $34 billion in market value. The drop came just days after the stock had set record highs, and one week ahead of the company's scheduled third-quarter earnings report on Nov. 2.

The key level now is $188.15. A close below it would leave Palantir more than 10% under its Oct. 9 record close — the conventional threshold market watchers use to confirm a correction.

The stock's recent breakout did not last long. Palantir closed above its November 2025 high near $208 last Friday and touched nearly $213 on Monday. By Wednesday, shares were back below that old ceiling, and an early move above $203 on Friday also faded. Yahoo Finance called the move a bull trap — a breakout above resistance that reverses and leaves buyers holding losses.

Software Stocks Fall Together

Palantir was not alone. In a basket of 45 software stocks, 43 were falling and 15 were down at least 5%. Combined losses topped $260 billion, including about $83 billion at Microsoft (MSFT). The iShares software ETF (IGV) lost nearly 5%, putting its worst day since April in play.

ServiceNow (NOW) swung from a gain of nearly 4% to a loss of more than 5% at one point. Salesforce (CRM) gave up a 2% gain and traded about 3% lower. Twilio (TWLO) fell by double digits and was heading for its worst day since August 2025.

The selloff was a rough finish to a week that had started well for the sector. On Monday, BofA double-upgraded Salesforce to Buy from Underperform, saying fears around artificial intelligence were overdone. The whiplash underscored how quickly sentiment can reverse across a group of stocks trading at elevated expectations.

Cybersecurity stocks took a hit as well. The cybersecurity ETF CIBR is down about 10% this week, on track for its worst week since March 2020, when the COVID-19 selloff hammered markets. Palo Alto Networks (PANW) and CrowdStrike (CRWD) are each down roughly 18% for the week. Reports that OpenAI is in talks to buy security firm Trail of Bits revived competition worries.

Valuation in Focus

TipRanks said big institutions may be locking in gains. The stock trades near 170 times earnings, even after a price target increase from Mizuho — a multiple that implies continued rapid growth, which is why the Nov. 2 report looms especially large for the stock.

Yahoo Finance noted the market value remains about 55 times the annual revenue Palantir projected in August. In that report, the company posted 93% second-quarter revenue growth and held $9.2 billion in cash and short-term Treasurys.

On the chart, $160 stands out as a major support area, about 14% below the current price. Bulls, meanwhile, would need to reclaim the $210 area and make the level stick.

Palantir is scheduled to report third-quarter earnings on Nov. 2, the first scheduled read on whether that growth pace carried into the second half. The stock is up about 13% year to date, with a market value near $483 billion.