All right. Hello everybody to another Palunteer earnings stream. It is Monday, November 3rd. We've got pounder Q3 2025 earnings on deck and I am very excited to be here. I think you guys can hear the sirens in the background. Okay, there you go. They're relaxed. Dude, these sirens in New Jersey have been kind of crazy over the past couple weeks. We're here. We're live. Thank you everybody for being here. Uh this is going to be an exciting exciting show. We've got pounder Q3 earnings coming up. We have been covering this company for the better part of four years now. Now when I mean we I mean myself, Matt, Amir, Arie, Suchin, just so many people that have been part of this community. And so we have another opportunity to do that. Very blessed to be in this position where we get to cover this and uh everyone get to hopefully enjoy some of the analysis.

One thing I want to start off with and I say this pretty much every time before pounder earnings is regardless of what happens to the stock, the company and the performance of the company is something that most of us really care about. And I know a lot of people here care about the stock, but I think there's a lot more people that have been in this stock since, you know, realistically under $10. And as a result, uh, the company performance is what really matters. Palenteer is now up more than 20 times from the lows. And so the stock price obviously has done very well for shareholders, has rewarded people, changed their lives. It's definitely changed my life. I'm sure it's changed so many of your lives.

The community is the greatest thing I've gotten from Palanteer, and I think most people would agree as well. outside of the financial gains, the ability to celebrate the journey of covering the world's most hated company four years ago, which now seems to be the world's hottest AI company has been an absolute blessing. So, regardless of what happens to the stock price, obviously, we will be analyzing the numbers and analyzing the stock, but very grateful to be here and very grateful to celebrate it with the entire community.

Joining me today, we got two people who have been in this name since the $67 range and have been doing a fantastic job covering it. along with the entire community. Ladies and gentlemen, we got air and we have Mr. Matt Money. What's up, guys? >> What up? >> Thanks for having us, brother. >> As always, >> are you guys >> Are you guys excited? It's another Palunteer earnings as we end out 2025.

>> You know, uh I think everyone kind of already feels that they're going to blow the numbers out of the water. I would be kind of surprised if they didn't. And I mean, everyone has kind of high expectations, but they kind of keep surpassing that, but I'm really curious now because the stock has been soaring. I'm kind of curious like is this like can we pick it even further because, you know, uh we've been talking about it like the momentum has been crazy, you know, uh with the talent here for like over a year straight now. Like everyone kind of knows that the numbers will be great, but will will we be able to like push 210? I don't know. I mean, do do you remember uh last earnings we all kind of had like predictions like, oh, will it be able to like surpass this kind of number and then you just like blew past? So, I don't know like uh is is there still steam in this momentum? Uh that's kind of what I'm curious about because I I already think that the numbers are going to be great. Like I already expect that.

>> I think that is the biggest question. So, Palenter was at 170 less than three weeks ago. Uh I think literally two weeks ago and now it's at 206. So obviously we have had a massive run since the decline over the past couple weeks. And I think the number one question on everyone's mind is hey we know the numbers are going to be good but how good do they have to be? The implied move is 8%. So that's like 17 bucks but that was before we moved up to like 207 today which was another alltime high. So it's looking like either 220 or 180 but we're going to have to see how the numbers plan out for that move to take place. Matt, how are you thinking about the stock price action in particular and uh how do you think the numbers will turn out in terms of having an impact on the stock?

>> I mean, the movement in the stock has been unbelievable. And yes, I am reporting live from a submarine uh in an undisclosed location. So, people that are roasting me in the chat, please continue. It's it's making my day. But uh but yeah, I think the earnings are going to continue to show up well and really excited to see I mean, but I think you're right. I think a lot of people are expecting a lot. So, I'm kind of curious. You know, selfishly, I hope the stock goes down. I would love to buy more, but I know in the meantime, that also means people, unfortunately, in the short term lose money. So, it's it's a tough spot to be in. You know, I'm continuing to buy every time I get a paycheck. So, but uh just the the performance of the stock has been phenomenal. And I think all I can equate it to is that people are really starting to see the true potential of this. And they don't view it as a black box anymore. So, like you stated as your as your intro, once the most hated company people are now starting to realize is essentially one of the most important companies in the world.

>> Uh we got someone else who is joining us that this guy has this guy has actually been doing what all of us as Palanteer investors should have been doing which is like traveling the world with your gains. But happily he's joining us for another pounder earnings. Araldo, what's up? >> Hello. Long time no see. God blessing us with his presence. It's been so

>> Arie, it's been a minute. Uh, obviously the stocks at alltime highs. I'll I'll I'll give the floor to you. What are you expecting on this earnings?

At the cost of sounding boring, I feel I'm always saying the same stuff in these last quarters that all the focus is always on uh the revenue which we had the pleasure of seeing this famous acceleration happening but in reality the biggest story is on the margin side in my opinion because now all the narrative is on how AI is boosting growth. Yes, that's cool. But what about the productivity? And everybody now wants AI in some sorts. But the only company that is showing a revenue boost that is significant at the same time showing that they're able to do more with less is actually Palanteer.

>> And the deals that you're showing right now, I think they speak from themsel. We're talking about deals that are more than massive from whatever vertical while uh other companies just crave what Palanteer is doing. Talking mainly about Service Now and uh Salesforce. I don't know if you noticed that um like the results of these other two guys were quite bad in the sense that they are speaking a lot of oh we are AI first we are here and there but then when you actually look at the numbers this is what you get like a growth that is just there 10% growth and then you go on service now which is doing better but again what is that amazing growth that the management tells in the earnings call we are AI first company what is that

I think it's a fair point I I think the kind of core argument that that you've been making that a lot of us have been making has is that Hound is the only software company that is growing in a world in which every company is saying AI is the tailwind. You would think okay dramatic growth right the fourth industrial revolution pounder is actually growing and you know they got it for 50% the streets expecting 1.09 billion we know they're likely to beat that uh and if they beat that by a wide margin then they are the only software company on the planet growing with the margins that they're going at and that's why I think the story continues to be exciting.

What what do you guys think will be the the the the single most important metric? Uh for me, I kind of have two, but if I had to choose one, it would be net dollar retention just for the scalability story that we've been hearing about.

Uh I mean that we've been having for like years now. Like the the whole core idea is you get customers, which is my second most like kind of important one now. So I don't I don't care too much about topline as as mentioning. I think it's more about margins now. Uh number one, the net dollar retention. If we can reach 130 or above, it really cements the whole Yeah, you get a Palanteer product and then you just keep expanding Palanteer across your whole business. You keep powering your whole business with Palunteer. And as you do that, you have better metrics as a company and Palanteer benefits. It's like a win-win situation and the scalability is kind of endless considering that they're in every single industry that exists out there pretty much. So, I'm curious your thoughts. What you think is like the the number one most important metric that you're tracking?

>> Arie, your thoughts. Customer count, operating margins. What are you thinking?

>> I I think it's the combination of everything. We know that uh the customer count was very important a couple of years ago because we were just craving to see some signs of emotion. Okay. Now, yes, I it's obviously very important to get a lot of customers, but we know that these customers can be of very different size. I don't want Palunteer to have 10,000 customers like Snowflake just for the sake of having customers. I'm happy when the customer count increases, but at the same time, I'm happy that these are customers that matter and want to sign deals worth even 200 million. In the case of Lumen, we were talking about the Boeing uh the defense. So, it's like Palanteer is capturing all the leaders and if all the leaders are happy to partner with Palunteer, that to me at this point matters more than the customer count per se. Obviously, if you have the leaders and the number of leaders increases and they expand, then obviously the net dollar retention expands and that creates all the powerful uh flywheel effects that make us happy.

>> Matt, any core metrics you're looking at for this quarter?

>> For this quarter? Yeah, revenue obviously would love to see that with a 52% year-over-year growth. Uh also customer count. Um I think I think Amir was hoping for a 100. I would be ecstatic with a hundred. Um but we'll see. But I definitely think that's uh that's something that's obviously important. Net dollar retention maintaining its its upward trajectory as well. I would love it to see get to over 130% which we haven't seen in in since 2022 or or even earlier than that. Um, there's a lot of different things, but um, and I'd love to see US commercial continue its pace over 100% year-over-year growth. That was huge to see last quarter, and I'd love to see that again this quarter.

>> Yeah, I agree. I think uh, US government growth is going to be really important along with the fact that obviously net dollar retention and the quality of contracts they're getting really matter. One point I heard today by one of the analysts was that uh some of the government agencies were anticipating the shutdown and so uh they kind of depleted a lot of their budgets towards the end of September in order to make sure that they have a service coming in even if they can't officially pay for those services. So that could have led to a little bit of a boost in government revenue particularly from the US towards the end of September ending out Q3. Uh which is also you know potential tailwind. But on the flip side of that this government shutdown is still a thing. Pounder has a multi-billion dollar business in the government. Um, Amir, any thoughts on if the shutdown is something that we should be at least curious about as investors for a pounder?

>> You know, I never even consider that. I hadn't heard that. Um, it it wouldn't surprise me if it was to be the case that people like, oh crap, let's deplete everything. But I mean, um, what what is the current status on on the shutdown? Because it seems that like Democrats are under a lot of pressure lately. like it is a very very bad look like optically. So I I don't know how long much longer it's expected to continue. It seems like they're actually losing a lot in like key areas by like prolonging this. So I'm not quite sure. I don't really have any real comment as of how much it might have impacted Palanteer. Like both it it it could have been positive. They're like, "Oh [ __ ] sign Palent Palanteer contracts right now." But no, I I I don't think it's meaningful. like actually I I I don't think it has some like large meaningful impact. I mean these process are kind of long drawn out. They're kind of strict with uh having to meet uh so many requirements and stuff like that. So I don't know in reality I don't think there's much impact but I haven't been tracking the stories. I I don't really know.

>> Sorry guys, talking about the government, I I think uh it is worth realizing something that maybe we haven't really took perspective on. Do you know what happened in Q2 that now should start affecting these numbers on what was the most important government stuff that uh happened?

>> Yeah, it was Maven, right? Uh so we in uh Q2 we got signed $800 million for Maven for four years. So already that moves the needle and then we got the NATO deal still for Maven. Then we also got some interesting clients like XAI with uh TWWG which is a huge holding. all these contracts that happen in Q2 now should start affecting. So I'm very curious of the government side because when uh we started covering the company the narrative was more or less uh the company was saying this government revenues are super safe. The market felt government revenues suck. We want commercial >> right? But what if actually commercial government side keeps printing money at 50% growth and we know this 50% growth also comes with huge margins.

>> Yeah, I'm kind of curious because um as you mentioned like in uh total contract value uh government was 1.2 2 billion last quarter and in total they signed 2.3 billion in total contract value and that was 143% growth year-over-year. That that is like insane for Q2. But I think like Q3 has been even more crazy with like everything they've been signing like how do they report like well up to 10 billion like how how does that show up for for the for the quarter when they say like yeah total contract value. So, I'm kind of curious if we like blow past like even 143% year-over-year growth is crazy, but I kind of feel like this quarter is going to be even crazier compared to the last one. Like, I think 2.3 billion is probably going to get beaten uh this quarter as well. I mean the activity has been insane.

>> But the the only difficult thing is that Palunteer really doesn't have a need to report as often uh on their investor relations page as they used to when they were considered a black box as we were talking about. They would like constantly put out, yeah, we we signed a deal with with these people. We signed a deal with with with these people. And um like they had to keep it going. And that's why Kramer said like, yeah, they're only uh like uh they are an investor relation company. They're not a real company like you know if you guys remember his called back in the day. Palanteer is largely recognized now. They don't need to report as much but still even looking at what we do know you know the post that Arie famously shares on on Palunteer bullets you know before earnings it's been some massive deals in Q3. So I'm really curious what it's going to look like.

>> No I think that's a really good point. I mean, one of the things that we now know is that everybody in their grandmother who isn't even a part of the company wants to say Palunteer on the earnings call. Um, just because it gives them clout and it gives them gives other people, you know, the the at least maybe investors calm that they're doing something about maybe their stale innovation within the company or their lack of digitalization efforts or or what have you. But that's something that we've we've seen is that people are almost begging to put out press releases not even on behalf of not even Palier putting them out but companies putting it out that hey we're working with Palier just to get people to say oh wow they might be doing something with AI they might actually be doing something rather than just sitting on the old business model that they've been sitting on for say 10 20 30 years that hasn't been doing anything and they've been losing market share so um I think it's we've done a complete 180

>> think of the Nvidia partnership that was released on Nvidia website and not yet on the Palunteer one.

>> Arie, I was going to ask uh you weren't on the >> We didn't get your thoughts, but what did you think when you saw that partnership, Arie?

>> I was that guy. Huh? Huh? Chips and is real. I really wonder if that was a hint nobody really grasped

this. And and what he's talking about is this right here. Karp said this back in June of 24. It's about chips and ontology.

>> In the market is going to go to chips and what we call ontology. We have this ontology and the ontology will allow you to take a large language model and use it, refine it and you then impose it on your enterprise in the logic of your enterprise in the security model of your enterprise. And what does that mean for the 70 70 people are here presenting talking about why they're using it, how they're using it. You got to remember we started uh selling this product just over a year ago. Uh we started with the claim that we knew a lot about the precursors of large language models and large language models and the general approach of just buying models is going to be essentially self-pleasuring for an enterprise at the cost of the enterprise. All the value in the market is going to go to chips and what we call ontology.

>> I mean, he was right. A lot of that value has gone to chips and it's gone to the software companies that can actually incorporate the reason that these chips are being bought, aka the LLMs, if there's no incorporation of the LMS in the context of an enterprise. What's the point of even training all these models? Seems like that's what Palun is doing.

>> He's always kind of right. He like if you really go back and watch like historical interviews with Karp at at the time some of might have been like sounding like really really crazy even the one that we kind of lost hope for you know reaching 4.5 billion uh by uh you know 2025 year end like it's looking like like it's not impossible even though we kind of give up on it and like all of these things like yeah why should I care about what Wall Street says today when I know what they're gonna say in two years like all of these golden quotes like typically when Karp says something you probably should be listening because he's been right on like most of the things relating to this space and yeah chips and ontology baby

>> doesn't make you think that despite we know we know that we need to pay a lot of attention on every effing word the carp says there is never enough the level of obsession we can have

>> yeah there really is never enough I mean it is has been an incredible journey. I want to reiterate again, whatever happens to the stock is whatever happens to it. It's made a pretty large move in the past couple of days. Now, uh the implied move is either 180 or 220. 180 or 220. So, I mean, it would not surprise me if the stock stays flat, if the results are really good, but not good enough for 220, but also not good enough or not bad enough to make a dump and we end up not having the massive implied move. But given that, given that the amount of volume that's been coming in over the past couple days, there probably is going to be some move. And you know, the numbers will speak for themselves. But I think even if we're able to hold like 205, 200, I think a lot of us will be pretty grateful.

>> Look, um, this stock is obviously expensive according to financial metrics. When we are starting talking about 100x but not on the earnings but on the sales we're talking about a company that is very expensive we see that also in terms of ebida free cash flow call it however you want of more than 200. So the question that I have uh I think everybody should have is uh what is the upside in holding the company? I think we need to be honest into trying to understand what is the state of what it is right now and what the market still doesn't see if we want to stay invested in the company. So assuming that you are still investing in the company, what do you see that the market still doesn't see?

You know, I've been saying this like for the longest time because if you've been following weeklys, if you've been following commentary like uh from from us and and me specifically, Palanteer has been trading overvalued for quite some time, but then we had a situation like from Q1 to Q2 where intrinsic value like doubled in one quarter because we found out something that we didn't know about company. I still think that Palanteer is just so early. We don't have visibility into like the sheer scalability but like we have some hints. We are seeing like this unprecedented like acceleration across the business and we believe they still early like they don't even have a thousand customers yet and they're still like able to scale current customers like uh crazy and we expect that to reach like 30% like just from current customers not not even accounting new ones.

>> I think the reason to hold it wh why why I feel confident just keeping shares and not selling is because we simply don't have some visibility enough into Palanteer. Everyone can recognize that it's a a super high quality company. We can recognize that it's likely one of the most important companies in the world right now. They're well positioned for like the biggest most hyped uh sector in the like financial markets that we have ever seen probably like a AI. They're like right at the center. And yeah, it might be expensive, it might be overvalued, but just quarterto quarter like they're just improving intrinsic value just so massively that I believe that it's worth just holding it. And as Matt mentioned earlier, like I kind of hope that it does drop because I kind of want to buy more like closer to fair intrinsic value. But like I I don't I don't have a fear like I don't think that one of the most and highest quality companies in the world is gonna collapse tomorrow like uh so yeah that that's the reason for me like the sheer intrinsic value growth every quarter that passes

>> but do you think uh is that the analyst the market in general still is not able to appreciate

>> I think the the market doesn't really care about Palunteer at all. I think the market in general just cares about the momentum and the lack of anything negative happening to the company. That's why I think it's been running so much. I I I don't think the market itself is like, oh, okay, we can see that Jet C2 is going to like No, no, I don't I don't think the market really cares. I I just think that it's like one of those momentum names. A lot of volume. Volume breeds more volume as people want to keep piling in. So I think like the market itself is probably mainly momentum but uh I still think that the people who are starting to understand Palanteer more and more are increasing. So it's like a double whammy kind of thing. It's the way I see it.

All right. So, we got three minutes left. We're going to get the results in a second. Again, the street wants 1.09 billion. They want 17 cents of EPS. So, uh, in the next few minutes, like around 401, 402, we should get the numbers.

>> Guys, since everybody is now a gam professional gambler on K on Kali, it seems let's simulate without money like what would be your personal bet on uh what will happen uh at the stock post earnings?

>> Are you saying pump or dump? Is that what you're asking, Arie? All right, put in the chat. What do you guys think? Pumper. I'm Look, I'm going with pump. I think they're gonna have a big beat. If they don't pump because the stock's up so much, it is what it is. But I think there's still a world where they can pump because they can beat by a pretty hard high margin. Air.

>> Yeah, I'm also in line with pump. I I dude I I think the quarter is going to be great. I have a hard time believing that they're not going to beat uh and I think Yeah, pump for me.

>> Okay, then I'll I'll take dump just because No, I was going to say I'm always wrong for the past several quarters. So, uh I've been thinking that we're gonna hit a turnaround. Not because I I want it to. Uh actually, selfishly, I do want it to, but um yeah, I mean I think at some point the overvaluation will get it. I just don't think it's going to be this quarter, but I I'll take dump just to be the um you had the customer service setup. Yeah. Um, yeah, I'll take that.

>> I don't know, man. I'm cautiously optimistic that these guys will continue to do well. But that being stated, I think that there's a lot of haters out there still that just want to see the company fail for God knows what reason. Whether it's political or or whether they didn't buy it at seven bucks, I don't know. What I will say is they'll get their time where we do see a 20 or 30% pullback just because of macroeconomics or because of some reasoning that for for for some unknown reason we just happen to have a 20 30%. Let them have their heyday because in 10 years time this won't matter. They they'll be wishing that they bought a 200. So, um, you know, that's why I buy. I can't time whether it's going to go back to 180 or whatnot, but what I can say is $200 is cheap compared to where we'll be in 10 years. So, for me, you know, um, I'd rather continue at least to get as much of the company as I can. And, uh, hold on.

>> All right, ladies and gentlemen, the stock market is now closed.

>> All right. Now, we wait for the results. They are not out yet. We should be getting them in about a minute. And then as soon as we get them, we will start diving deep into the numbers. 20798 we are green after hours. 208 20830 it's moving higher.

>> Oh, we're up. Oh, we're green. We're green. Oh my goodness. We're green. That's a big green one. 220. 221.

>> It's green. It's greeny green. It is green. I don't have the numbers yet, but it's green.

>> okay, we got it. They beat EPS by 24%. They beat revenue by 8%. 1.18 billion. 1.18 billion. That is an 8% beat on revenue. 24% beat on EPS. EPS is up 110% year-over-year. Revenue is up 63. Is that correct? I believe that's 63% year-over- Yeah, that's 63%, folks. Shre expected 50%. We came in at 63%.

>> 100 million revenue more.

>> I had them doing one 1 12 billion. What What What did they

>> 1.18? They came in at 1.18.

>> Man, even beat my expectations. That's 63%, right?

>> That's insane.

>> Yes.

>> That's absolutely insane.

>> Yeah. Okay. So, I got some numbers. So, uh f they see fourth quarter revenue to 1.3 billion. The analyst thought it would be 1.19. They see fiscal year revenue to 4.4 to 4.4. The analyst thought it would be 4.15. Very close to that 4.5 number Karp said a couple years ago. Uh fiscal year adjusted operating profit to 2.15 to 2.6. The street thought it would be 1.93. And then adjusted Ebida for the third quarter was 606 million. The street thought it would be 502 which goes to show their margins are continuing to go go higher.

Yeah, probably eclipse that rule of 100 like quite handily this quarter like a r rule of 110 or something is going to be

>> 114.

>> These numbers, folks, are I mean, these are just mind-blowing. Revenue now forecast at 1.33 billion. And this is above street estimates too. Full year revenue 4.4 billion also stronger. 2025 free cash flow guidance also revised higher for QC beats in both US commercial and US government. US commercial revenue up 121%. US government revenue was up 52%. Rule of 40 this is a enterprise software metric that gets used 114% now for Palunteer. I spoke with CEO and co-founder Alex Karp who told me he suspects these are the single best numbers ever printed in enterprise software.

Uh quote, I think it was a watershed, it is a watershed moment where people who are just basking in their own narcissistic skepticism of Palanteer largely for reasons of laziness or ideology have to really rethink maybe the ontology is the formative piece of software, maybe the FTE model, maybe being pro-American is actually a good thing. Karp again saying that those who will make money in AI will have chips or the ability to connect that raw data to the real world meaning ontology.

>> I mean 40% net income 33% oper operating margins. That is insane. What the [ __ ] >> I think 40 cent 40 cents on every dollar goes to the bottom line.

So they got a six- handle. The street wanted a five handle. They put a six handle in front of it. 60% year-over-year growth. US revenue up 77%. Close 204 deals at least a million. This number was 157 last quarter. That's 50 more deals. Record setting 2.76 billion of TCV. That's up 150%. US commercial TCV 1.3 billion. That's up 342%.

Customer count, 45% year-over-year, 7% quarter over- quarter. Uh remaining deal value, 3.63 billion. That's up 200% year-over-year, 30% quarter over quarter. Gap net income 393 million, 33% uh margin adjusted income. Wow. They broke through 51. This was at 44 last quarter. They increased it by 7 percentage points. 51% adjusted income operating margins. 61 million uh net income margins at 40% EPS of 21 cents and adjusted free cash flow 46% margin at 540 million

6.4 24 billion in cash. They had 6 billion. They added 400 billion to that. They now have one of the strongest balance sheets in all of software as well.

We are still at this very start of things. This remains the beginning, the first moment of a first chapter. Our business generated 1.2 2 billion in revenue for the third quarter of the year, a new record in our more than 20 year history, representing an accelerating and otherworldly growth rate of 63% over the same period the year before. We also generated a staggering 476 million in profit this past quarter. Again, a record in our company's history. And to be clear, nearly half a billion dollars in profit in only three months. It is worth remembering that the business is now producing more in a single quarter than it did in revenue not long ago.

This ascent has confounded most financial analysts in the chattering class whose frames of reference did not quite anticipate a company of this size and scale growing at such a ferocious and unrelenting rate. Some of our detractors have been left in a kind of deranged and self-destructive befulement. It has indeed been difficult for outsiders to appraise our business, either its significance in shaping our current geopolitics or its value in the in the vulgar financial sense. The reality is that Pounder has made it possible for retail investors to achieve rates of returns previously limited to the most successful venture capitalists in PaloAlto.

Amen to that. And we have done so through authentic and substantive growth. In the United States, our commercial business has now more than doubled in the past 12 months, growing 121% and generating 397 million in the past quarter. This segment of our operations is an absolute juggernaut, and we believe that it will become on its own one of the most significant business stories of the century. and American economic life.

For all of its idiosyncrasies and complexities, American corporate culture remains one of the most adaptive on the planet. Our partners in the United States, the earliest and most voracious adopters of the novel language models that are presently reordering human life and the ontology that allows them to effectively operate, understand how significantly the terrain beneath us all has shifted and they are racing to experiment and evolve, setting aside preconceived notions of what ought to work for what actually does. It is a ruthless pragmatism and one that is yielding extraordinary results.

Today, America is the center, and it must hold. A rejection of any shared and defined and defined success of common culture in this nation and others has had significant costs. We should indeed return to a national must return to a shared national experience an embrace of common identity that that by definition puts forward certain ideas, values, culture and ways of living at the exclusion of others. It is and was a mistake to to casually proclaim the equality of all cultures and cultural values. Some have proven to be wondrous and generative, others destructive and deeply regressive. And an even greater mistake is to believe that we could or should convert the world to our way of living.

And yet we have as a culture resisted some actively and strenuously a degree of ascent to common beliefs or of shared culture that would make such orientation possible. It is however the pursuit of something greater, a rejection of vacant and neutered and hollow pluralism that will help ensure our continued strength and survival. Sincerely, Alexarp, CEO and co-founder of Pounder.

>> Take for you to perhaps change your tune uh on Palunteer.

>> Yeah, the fundamentals are rock solid. The valuation is like anything we've ever seen uh train at 90 times revenue. So there's no way you can put any evaluation metric on the actual valuation. Uh again, we've never seen anything like this. Uh the fundamentals, we certainly haven't seen anything like it as well. So to split the two, we've said uh repeatedly the fundamentals remain exceptional. Uh the question is, is this the the best place to put your capital? Uh based on all the other trends that are going on, you can buy Amazon at 15 times. You can buy Pelanteer at 90 times revenue. So we've been arguing that uh we feel there's a better use of capital in other places. We've been wrong for part of this call on Palanteer, but I think we've been right in those other names just given the valuation concern and they continue to uh execute at at a incredible high level.

>> So if we have nothing like if we have nothing like it to compare it against, how do you get to a $60 price target?

>> 25 times uh revenue, which would be one of the highest multiples in software right now. If you look across the entire industry, the highest multiple in our industry, whether it's Cloudflare, Crowd Strike, these are phenomenal companies that are producing huge returns that trade at those multiples. And so you have to assume that this execution continues consistently for years uh for that multiple to come down. We've never seen a 90 multiple. And look at the numbers. Why is the stock flat? because it's flat because the multiple is so high and there's no real room on the multiple expansion to go,

>> The retail investor can bet because they don't really know the valuation. They don't know it trades. You can literally take a 60 point multiple between the second highest rate uh uh uh name which is Quadflare Crowd Strike. Uh and the gap between that and Palunteer is like 60. So that it's a it's just it's a it's a it's a number that we don't feel comfortable with.

>> Arie, your thoughts on what Brent said?

>> Uh, sorry. Okay. I can't understand his point because uh I was reasoning like him when I was just an analyst. So when you talk with institutional clients you they will tell you okay but why should I buy this when there are other alternatives and the alternatives are stuff that for him are better are easier to understand with Palunteer I believe uh that if you haven't captured exactly how insane the business is you should better just shut up and not pretending to know stuff because uh the all the other companies that he mentioned are not able to show what Palanteer is doing. He's not able to show neither at the product level neither at a financial level which is something he should understand.

>> The other companies that he mentions the ones he likes are not able to to grow this much while also expanding the margin. The stuff that I keep insisting that is black magic. we can give it a name to this black magic as being able to deploy AI effectively to yourself to your clients and uh all the other companies are not doing that. Imagine this already without the multiple sorry the margin expansion that paner is having seeing these acceleration in the revenue is already crazy. The fact that the margins essentially more than doubled in these years while having a lot of growth is just out of the mind. It's like having an infinite return on investment on the capital

>> it's it's a complete outlier. How do you price an outlier with an outlier price?

>> Uh, greetings. Um, by any normal or even reasonable standard, these are not normal uh, results. These are not even strong results. These aren't extraordinary results. These are arguably the best results that any software company has ever delivered. Um, and uh, and it's that's not hyperbolic. despite what your analyst friends may want you to believe because they've been wrong at every price. They're wrong on every at every single round.

But um a a a normal enterprise company should not have a rule of 40 above 100. A normal enterprise company at our base should not have over 100% US commercial growth. Should not have 77% growth in the US. uh and by the way that uh that growth is being held down by a stagnant Europe which is still a significant part of our business. So the pure uh unvarnished numbers are 77% growth off of a massive significant base with very significant cash flow with a company that throws off a rule of 40 of 114.

In order that you turn the value the high value uh uh revenue of your enterprise over to them in return for for these accolades. We created direct alignment with our customers. And what does that mean? It means when our customers have a unique and tribal way of doing something, whether it's underwriting or fighting or making workers even more valuable, we put an FDA, we orchestrate it in ontology. We take the tribal understanding of their business, the specific nature of their business that makes them particular and valuable and lethal, and we empower that. And how do we participate in that? Unlike seemingly in the most obvious way, we are downstream from the value creation. So when you see 141 or you see 77% or 63 and you ask and by the way with really a a a workforce that is uh not growing in any way linearly proportional to that growth and also with a sales force which is declining which seems improbable. The reason why that's working uh is because we are making our clients more money or we're making them more dominant on the battlefield and they're paying us a subset of that.

>> But I would say if you're thinking about how this company is going to go, look at our ability to value create. Look at our ability to create revenue on the top end. Look at it. Let look at the unit economics of our business. If you're a technical expert in in how do you evaluate business, evaluate those numbers against any other business you've ever seen and then make your decision. But yeah, I'm wildly enthusiastic. I think we're wildly enthusiastic and um and thank you for uh those of you who stay stayed with us to enjoy these numbers, especially Palunteerians uh who work day and night to deliver these kind of numbers.

>> Yeah, great. Look, obviously another monster quarter for you guys. Congrats. Um, so my my my question for you is, you know, for Alex and team. What can you just walk through just the accelerated sales cycles that you're seeing from so many companies that have gone to the boot camps? Like what surprised you from when they come to you at that first sort of you know contact to now actually launching deals? I mean you know maybe you could talk about that just in terms of everything you're seeing anecdotally.

>> Great. Thanks Dan. So I think you know we look at US commercial we closed 1.3 billion in TCV that's 6x on a dollar weighted duration basis from what it was a year ago and of those deals 83 were worth a million or more 40 were 5 million or more 21 deals were $10 million or more I've been involved in a lot of those directly I'm feeling exactly what you're asking on the ground from customers and what's what's happening now is from the seuite across the company customers are coming to us looking to not just say let's do a use case the customers where we're having the impact are coming to us saying how do we deploy this across our entire organization how do we reorganize our entire organization around Palunteer and AIP and that's what's happening on the ground and we're singularly focused on delivering the value to the customers and that's our go to market how do we get the product to them and deliver the value

>> where Ryan is like really very much on the front line here is you know there's both how many customers approach you I think where we're seeing the biggest shift is the customers who've approached us very quickly want to move to how would I change my enterprise to express it in a way that's most valuable according to my terms in your product and then want to and literally want to reorg a shorthand version that we often use is you used to have to take your company private to change the the unit economics of it basically just like we're providing venture results high-end venture results to normal investors in the last couple years what we're doing actually in enterprises is providing a private equity-like transformation in the public art markets in the public space under the current leadership.

So, someone wrote in the chat like during I I I I think everyone uh know noticed this as well, but someone wrote uh I counted exactly 114 table banks throughout you know his opening speech. He was sitting and banging the the heck out of that table. No. Um

>> uh well, we kind of predicted that nice question. Another boot camp conversion one uh wasn't really answered. Not not too important. I think the two the two biggest ones was of course to see okay what is happening with AFDs I mean it's it's been a topic for a while uh there have been some demos out out into the public some kind of you know there have been some some whisperings but you know they actually start to give us some kind of numbers like associated with it which is what what I love you know I always say this that people don't always understand you know where Palanteer is implemented they don't always understand the use cases at a specific But everyone understands time when they say that uh you know uh spawning an army to uh you know of a fds to transform a legacy data warehouse in 5 days that would have taken two years like everyone can understand that two years to five days that is pretty significant

>> um I also uh want to highlight um the last question there it just made me like picture Brent still just you know the the interview we we watched with the Jeff analyst just before when He said, "Um, yeah, turn on conventional TV and watch those who didn't invest into us cry." And then if you guys remember Brent Thiel's face, he kind of looked like he was about to cry. Like he looked pretty pissed off, you know, just sitting there on CNBC. Uh, it was magical.

The thing that intrigued me the most is um seeing the evolution of FDS, the AI FDs that now empower from what we understand the FD themselves and then the clients. That is uh what really talks the language of shrinking time to the point where I was really wondering the other day. Imagine you are a parent, you you are called by a client how you can really show what you can do, what you can tackle very fast. And essentially they described that with this new product AI hive mind which is an aggregator to of Aifds or similar agents to tackle problems.

>> I also think there were some uh interesting comments regarding like uh the the current customers. So they mentioned that the top 20 customers uh I I did the calculations uh still 20 out of 911 customers account for 43% of revenues and they are accelerating like how much they're growing 20 like the top 20 customers account for almost half the business and they are now growing uh 38% year-over-year which is higher than the net dollar retention. So the most sticky like most like revenue highest value clients are growing higher than like uh uh the overall net dollar retention and then the question came up in in the call like well h how are you able to scale like this and uh there there was a I don't remember the exact quote but it was something along the lines of we own part of the AI market that cares about value creation.

Yeah, I agree. I I I pretty much agree with everything you guys said. I thought Karp was very excited on the call and uh I think the reason he was excited was has nothing to do with the stock. Quite frankly, it had to do with the fact that this quarter was incredible and the stock will do whatever the stock does. I mean, again, it's at 202. A lot of us were covering this name below was $10. So, it's hard to have a lot of sympathy for the oh, it's not at 220. It's like, okay, that's fine. If that's the extent of your analysis, then then you can have that. But if you're actually holding this company for the next 10 years and you're looking at not the returns of the stock, which have been far beyond most stocks in the entire market, but actually looking at the results they put out, I mean, I would be as energetic as Karp as well if you're pulling up 14% rule of 40s, 77% US commercial growth, no debt, 6 and a half billion in cash, uh, and topline revenue growth of 63%. I mean, these numbers are just incredible.