By Arsheeya Bajwa
(Reuters) -Palantir recommends its clients steer clear of Chinese startup DeepSeek’s AI models, a senior executive of the data analytics company said on Monday, days after doubts were raised about the United States’ lead in AI technology.
“We would strongly discourage it (DeepSeek) and don’t think any customer in the U.S. government will be able to use it,” Palantir’s Chief Revenue Officer Ryan Taylor said.
U.S. officials are looking at the national security implications of the app DeepSeek, White House press secretary Karoline Leavitt said last week. Federal agencies such as NASA have also banned the use of the tech by employees, according to media reports.
The data analytics company also forecast first-quarter and annual revenue above Wall Street estimates on Monday. More than 40% of its fourth-quarter sales was from the U.S. government.
The company’s shares surged 22% in extended trading on Monday after Palantir forecast fiscal 2025 revenue between $3.74 billion and $3.76 billion, above the average analyst estimate of $3.52 billion, according to data compiled by LSEG.
Co-founded by tech billionaire Peter Thiel, Palantir provides services to governments like supplying software that visualizes army positions.
“On the government side, Palantir’s vision is very well aligned with the current administration,” said D.A. Davidson analyst Gil Luria.
Palantir would also discourage commercial clients from using the Chinese startup’s AI models, Taylor said, adding that if customers still choose to employ DeepSeek models the company would continue to work with them.
Palantir is working to reduce its dependence on government spending. The data analytics firm expects revenue derived from companies in the U.S. to grow at least 54% in 2025 to more than $1.80 billion.
Businesses pushing to deploy generative artificial intelligence tech have helped drive sales for Palantir’s AI platform, AIP, which is used to test, debug code and evaluate AI-related scenarios.
Palantir forecast March-quarter revenue between $858 million and $862 million, compared with estimates of $799.4 million.
Expanded tariffs ordered by Trump on Saturday could also help drive demand for the company’s analytics services centered around supply-chain and logistics management, Taylor added.
On an adjusted basis, Palantir earned 14 cents per share in the fourth quarter, beating estimates of 11 cents.
(Reporting by Arsheeya Bajwa in Bengaluru; Editing by Shounak Dasgupta)
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