Cathie Wood sells Palantir on rallies despite 93% revenue growth

Palantir Technologies reported second-quarter results on Aug. 3 that CEO Alex Karp called "otherworldly" in the company's earnings release, and the numbers justified the enthusiasm. Revenue rose 93% year over year to $1.94 billion, accelerating from 85% growth in the first quarter. The growth was broad-based: U.S. commercial revenue, the fastest-moving piece of the business, grew 149% year over year to $764 million; U.S. government revenue grew 90% to $809 million; and closed total contract value rose 49% to $3.4 billion. Net income reached $1.06 billion, representing a 55% profit margin. Management raised guidance across the board, putting third-quarter revenue near $2.16 billion and full-year outlook at about $8.15 billion, roughly 82% more than 2025.

The market responded decisively. Shares jumped 29.5% on Aug. 4, narrowly missing their biggest single-day gain ever. But Cathie Wood's ARK Investment Management began selling that same week. On Aug. 4 and 5, ARK sold a combined 109,492 shares worth about $17 million. After shares jumped another 10% on Friday, ARK sold again on Aug. 8, unloading 11,525 more shares worth about $2 million. That same Monday, ARK bought about $26.6 million of Nvidia. By Aug. 8, Palantir closed at $175.23, up roughly 40% from pre-earnings levels but roughly 15% below its record high of $207.52.

Wood's sales pattern reflects not skepticism about Palantir's business but concern about its valuation. Palantir trades at about 150 times trailing earnings and 90 times forward earnings—a steep multiple by almost any measure. Even measured against the 93% year-over-year growth Palantir just delivered, the valuation carries significant execution risk: at these multiples, even a modest slowdown in future growth rates could strike the stock hard. By contrast, Nvidia—the chipmaker at the center of the AI build-out—trades at about 22 times forward earnings. ARK's two Monday trades placed the two stocks at opposite ends of this valuation gap, suggesting Wood views trimming the software stock and adding to the chip giant as the more prudent use of capital.

History shows Wood has worked both sides of Palantir's swings. In April, with shares down nearly 30% for 2026, ARK bought about $11 million of Palantir. It bought more in June, and Palantir still ranks among the biggest holdings across ARK's family of funds. The pattern zooms out to a repeating arc: ARK built the position in 2024, sold much of it into 2025's climb, and bought back in as shares fell earlier this year. This is disciplined portfolio management tied to price, not a verdict against the business. But at roughly 150 times earnings, a buyer today is paying for years of quarters Palantir has not yet reported.