As artificial intelligence reshapes the technology landscape, investors face a critical choice between Nvidia and Palantir—two leaders with distinct growth models. This analysis evaluates their financial performance, market positioning, and AI-driven trajectories to identify the stronger long-term play.
- Nvidia generated $39.3 billion in revenue for fiscal year 2025 with a gross margin exceeding 75%
- Palantir’s revenue reached $1.7 billion, up 24% YoY, with subscription revenue growing 31%
- Nvidia’s market cap exceeds $2.2 trillion, with 85% of global AI workloads processed on its GPUs
- Palantir’s forward P/E is 70, compared to Nvidia’s 48, indicating higher growth expectations
- Nvidia’s enterprise gross margin is 75%, while Palantir’s is 78%, highlighting operational efficiency
- Palantir’s strategic partnerships span defense, healthcare, and government sectors, signaling diversified growth avenues
Nvidia (NVDA) and Palantir (PLTR) represent two divergent paths in the AI revolution. Nvidia, the dominant force in AI chip manufacturing, reported $39.3 billion in revenue for fiscal year 2025, driven by robust demand for its Hopper and Blackwell GPU architectures. Its gross margin remained above 75%, underscoring pricing power and technological leadership. In contrast, Palantir’s revenue for the same period reached $1.7 billion, growing 24% year-over-year, with a focus on enterprise AI platforms like Foundry and Apollo. While Palantir's net loss widened to $117 million, its subscription revenue increased by 31%, signaling growing customer adoption. The fundamental difference lies in business model and scalability. Nvidia benefits from a hardware moat, capturing significant value across cloud providers, data centers, and automotive sectors. Its market capitalization exceeds $2.2 trillion, reflecting investor confidence in sustained AI-driven demand. Palantir, on the other hand, operates as a software and data integration platform, serving government and commercial clients with customizable AI solutions. Its enterprise license model offers recurring revenue but faces higher customer acquisition costs and slower scale-up compared to hardware incumbents. From a valuation standpoint, Nvidia trades at a forward P/E of 48, while Palantir’s is approximately 70, reflecting higher growth expectations despite negative earnings. However, Palantir’s enterprise gross margin of 78% demonstrates efficient execution, and its strategic partnerships with major defense and healthcare organizations suggest expanding use cases. Nvidia’s position in the semiconductor supply chain, backed by AI training demand, remains exceptionally strong, with 85% of global AI workloads now processed on its chips. The broader market impact is significant. Institutional investors are allocating capital toward infrastructure plays like Nvidia, while growth-focused funds are increasing exposure to Palantir. Long-term investors must weigh Nvidia’s established dominance and predictable cash flows against Palantir’s high-growth potential and software scalability. The decision hinges on risk appetite and conviction in infrastructure versus application-layer AI innovation.