TL;DR: Palantir Technologies is committing significant investment to UK military contracts whilst continental European growth stagnates due to privacy and political sovereignty concerns, with CEO Alex Karp describing Europe as “stagnant” despite representing a significant portion of business.
The US defence technology company, riding a stratospheric share rally fuelled by global defence spending increases and AI enthusiasm, is positioning the UK as a European bridgehead for military technology development whilst acknowledging limited traction across the continent.
UK as Military Technology Epicentre
Louis Mosley, Palantir’s UK head, stated the company is planning “significant investment” in Britain to secure military contracts. “The UK can be an epicentre of defence and military technology development,” Mosley told Bloomberg Television. “It has all of those ingredients.”
Britain has committed to increased military spending and advanced technology adoption, including autonomous drones and artificial intelligence software. Palantir pledged £1.5 billion ($2 billion) in UK investment earlier this year and is finalising a £750 million, five-year deal with the Ministry of Defence.
The company currently employs approximately a thousand staff in London, its second-largest office globally. “The UK is the premier military power in Europe,” Mosley noted. “I think it has the potential to be a key bridge into the rest of the continent.”
Continental European Resistance
Palantir derives about a tenth of sales from the UK, where it holds a controversial contract with the National Health Service. However, continental Europe has proven more reluctant to purchase Palantir tools, primarily due to privacy and political sovereignty concerns.
On an earnings call, CEO Alex Karp told investors that “growth is being held down by a stagnant Europe, which is still a significant part of our business.” The company signed an early agreement with the Polish defence ministry in October, though terms weren’t disclosed.
Market Performance and Recent Developments
Palantir’s shares have gained more than 143% this year, driven by global defence spending increases and AI-sector enthusiasm. Last year, the company won a Pentagon contract to provide software for identifying battlefield targets and gathering intelligence.
However, famed hedge manager Michael Burry recently took a short position in the company, temporarily sending shares down. Despite this, the broader trajectory remains strongly positive, supported by continued global military technology modernisation.
The company’s experience illustrates the complex landscape facing US technology firms in European markets, where enthusiasm for advanced capabilities collides with regulatory frameworks, privacy expectations, and political sensitivities around foreign control of critical infrastructure and data.
Source: Bloomberg