Palantir Technologies on Wednesday expanded its cloud computing partnership with Microsoft on federal government contracts. PLTR stock fell on the news as the Nasdaq composite sold off.
In addition, a government procurement arm, FedRAMP, has approved the Palantir cloud service using Microsoft's Azure cloud infrastructure.
"This milestone expands Palantir and Microsoft's strategic partnership from the private sector to the public sector, bringing the best in class cloud components to the federal marketplace," said a Palantir news release.
William Blair analyst Louie DiPalma holds a underperform rating on Palantir stock.
"We do not view the Microsoft Azure partnership as significant," he said in a report. "Palantir already offered its Gotham and Foundry application on Amazon Web Services as a SaaS (software-as-a-service) model."
On the stock market today, PLTR stock fell 4.4% to close at 7.98. Also, Palantir stock has gained 26% thus far in 2023.
PLTR Stock: Big Government Provider
In addition, Palantir gets nearly 60% of revenue from government agencies. They use Palantir software for intelligence gathering, counterterrorism and military purposes. Also, Palantir uses artificial intelligence tools in some products.
Further, PLTR aims to grow its commercial business. The software maker is looking to expand into the health care, energy, automotive and manufacturing sectors.
Also, Palantir's big government business remains key as some large U.S. government contracts are coming up for renewal.
Meanwhile, PLTR stock holds a Relative Strength Rating of 52 out of a best-possible 99, according to IBD Stock checkup.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
