Palantir Technologies (NASDAQ: PLTR) fell nearly 8% in Tuesday's premarket trading after the data analytics company reported a slowdown in third-quarter contract growth, even as its revenue and adjusted earnings exceeded analyst forecasts. Shares changed hands around $164.15 at 8 a.m. ET, down from Monday's close of $178.34. Premarket trading runs from 4 a.m. to 9:30 a.m. ET, and quoted levels there can shift before the regular session opens.

Earnings Beat, but Contract Growth Cools

The company reported quarterly revenue of $2.313 billion, up 96% from a year earlier, and adjusted earnings of $0.44 per share. Both results surpassed analyst forecasts, but contract figures grew more slowly than in the previous quarter.

Palantir signed contracts worth $2.918 billion during the quarter, an increase of 6% year over year. That followed 49% annual growth in the second quarter, when new contract value reached $3.373 billion.

U.S. commercial contracts totaled $1.463 billion, up 11% from a year earlier — a deceleration from the prior quarter, which recorded 153% annual growth on $2.132 billion in contracts. The company also closed 212 deals worth at least $1 million, down from 220 previously.

These figures measure signed business, including customer options, rather than completed sales. Bookings draw attention because they capture demand won in the period, ahead of its conversion into recorded revenue. The share decline came amid broader selling of AI stocks, with Goldman Sachs data showing hedge funds reduced related holdings during October.

Long-Term Contracted Revenue Declines

Palantir reported $2.74 billion in long-term remaining performance obligations, down $70 million from $2.81 billion in the second quarter. The decline came as shorter-term obligations rose from $2.09 billion to $2.14 billion.

Total remaining performance obligations edged down to $4.88 billion from $4.90 billion, leaving them 88% above the year-earlier level. The measure covers contracted revenue not yet recorded and excludes contracts lasting 12 months or less. The duration mix is part of what the metric signals: longer-dated obligations represent revenue under contract further into the future, while shorter-dated ones convert into recorded revenue sooner. Chief Financial Officer David Glazer said termination rights also limit the measure's coverage of government work.

Separately, U.S. commercial remaining deal value reached $6.517 billion, rising 79% annually.

Questions about rising AI infrastructure spending have surfaced across the technology sector. Amazon recently reported a $42.4 billion trailing annual free cash flow outflow as it increased data-center investment.

Palantir Raises Revenue Outlook

Despite the cooling contract metrics, Palantir raised its guidance. The company projected fourth-quarter revenue of $2.649 billion to $2.653 billion, above analysts' estimate of $2.46 billion, and lifted its 2026 revenue forecast to $8.530 billion through $8.534 billion. The fourth-quarter range implies roughly 14.6% sequential growth at the midpoint from the third quarter's $2.313 billion, giving investors a company-set benchmark for the next earnings report.

Glazer said customers signed several shorter Sovereign AI contracts worth tens of millions of dollars and that he expects their size and duration to grow, although Palantir did not link those contracts to the decline in long-term obligations. Whether the shorter deals scale as he expects will be visible in future contract disclosures.

Tokenized Exposure and Share Performance

A Palantir-linked token, PLTRB, traded near $164.14, down 12% over 24 hours. Its trading differs from Nasdaq-listed Palantir shares. The broader market is debating tokenized stock trading plans after several companies objected to one proposed system — a discussion whose outcome would shape tokens tied to listed shares such as PLTRB.

Palantir shares had already declined for five straight sessions through Monday. The stock lost about 10.3% during that stretch, and the $178.34 close left shares 16.2% below the 52-week high of $212.94.

This article was originally published on Blockonomi.