Markets
Musk Protest
Protesters outside a New York City Tesla dealership on March 1 (Leonardo Munoz/Getty Images)

Palantir shareholders unsure if Musk’s attention is a good thing or not

The tech oligarch’s de facto takeover of the federal bureaucracy has huge implications for the company, whose biggest client remains the US government.

Matt Phillips

Elon Musk has been a fan of Palantir and its brash CEO for a while now. Over the weekend, he again demonstrated his support for Alex Karp after his new book topped The New York Times’ list of nonfiction bestsellers.

But not everyone seems comfortable with the level of attention the Tesla CEO is giving Palantir. While Musk’s Trump adjacency made Tesla one of the big winners of the market’s postelection run-up last year, his close association with right-wing politics both in the US and worldwide has had costs as well. Amid cratering sales in Europe, and signals that China sees Tesla as a potential point of leverage on the administration, Tesla stock has cratered by over 40% since December.

Over at a subreddit frequented by Palantir shareholders, Musk’s latest endorsement for Karp prompted a wave of debate both from those uncomfortable with his politics and work for the Trump administration ...

Comment
byu/Fun-Journalist2276 from discussion
inPLTR

... to those who see a closer association with Musk as a clear boon to Palantir...

Comment
byu/Fun-Journalist2276 from discussion
inPLTR

... and others who essentially say their investment in Palantir was premised in part on what they see as the potential corruption of the Trump administration and DOGE.

Comment
byu/Fun-Journalist2276 from discussion
inPLTR

Musk’s position as the Trump administration’s semiofficial deputy, tasked with cutting the federal workforce and taking unprecedented control of key parts of the US government’s tech infrastructure, could clearly be consequential for Palantir. The data analytics and AI software company’s main customer remains the US government, due to its long standing focus on defense and intelligence applications.

On Wall Street, analysts have been trying to game out how the Trump administration’s DC disruptions — including potentially unprecedented cuts to defense spending and Musk’s DOGE — will work out for contractors.

Wedbush analyst Dan Ives, a longtime Palantir bull, wrote in a note out Monday:

“Palantir is so well positioned for this new disciplined spending environment at the Pentagon and this will ultimately be a positive growth catalyst as the various programs are scrutinized and as Karp & Co. get a bigger seat at the table in the Beltway. We also believe Palantir is attached to many programs/contracts in the DOD that are safe and not at risk of getting cut in this new spending climate given their high priority.”

Likewise, BofA analysts suggested in a note that some software and IT services companies would benefit from the administration’s cuts to the federal workforce:

“We see the cohort as net beneficiaries in a market landscape measured by modernization, efficiency, and outsourcing. Booz Allen Hamilton (Booz Allen Hamilton) and Palantir (PLTR) are most strongly positioned to early DOGE actions, in our view.”

At any rate, both Tesla and Palantir are up on the day, after tumbling 20% and 30% over the last two weeks, suggesting that the “bro bubble” may have a bit of air left in it yet.

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Samsung’s massive Q1 fails to lift Sandisk, other data center plays

Almost all memory stocks slipped Tuesday, despite getting a positive update on the massive flood of money pouring into the sector from the AI build-out, as the potential escalation of the US war with Iran Tuesday evening overshadowed Samsung’s blowout numbers.

Korean chip giant Samsung Electronics reported preliminary Q1 results showing operating profit up by 755% compared to Q1 2025, trouncing pretty elevated expectations for a gain of about 550%.

Samsung is the world’s largest producer of NAND and DRAM chips. Once considered low-value commodity inputs to tech products, NAND and DRAM prices have exploded over the last six months amid a hyperscaler scramble to secure chips that can manage the surfeit of data produced by AI.

The same dynamics have made memory plays like Sandisk, Western Digital, and Micron some of the best-performing stocks in the S&P 500 over the last 12 months.

But other than Seagate Technology Holdings, those stocks were down Tuesday as of 11:15 a.m. ET, as the surge in oil prices and ongoing war with Iran muted much of the AI data center trade excitement. Bellwethers like Nvidia and hyperscalers like Oracle and Meta were struggling early, as were data center input makers like Corning and Coherent, AI power plays like GE Vernova, Vertiv Holdings, and even hard-hat builders of the shells that house all those AI servers.

On the other hand, some so-called optical stocks — makers of fiber-optic connections that quickly shift data between users, hyperscalers, and all around data centers themselves — were up. Lumentum and Arista Networks, two popular optical stocks, were showing resilience.

Samsung flags eightfold jump in quarterly profit as AI chip demand pumps prices

Samsung flags eightfold jump in quarterly profit as AI chip demand pumps prices

Samsung is the world’s largest producer of NAND and DRAM chips. Once considered low-value commodity inputs to tech products, NAND and DRAM prices have exploded over the last six months amid a hyperscaler scramble to secure chips that can manage the surfeit of data produced by AI.

The same dynamics have made memory plays like Sandisk, Western Digital, and Micron some of the best-performing stocks in the S&P 500 over the last 12 months.

But other than Seagate Technology Holdings, those stocks were down Tuesday as of 11:15 a.m. ET, as the surge in oil prices and ongoing war with Iran muted much of the AI data center trade excitement. Bellwethers like Nvidia and hyperscalers like Oracle and Meta were struggling early, as were data center input makers like Corning and Coherent, AI power plays like GE Vernova, Vertiv Holdings, and even hard-hat builders of the shells that house all those AI servers.

On the other hand, some so-called optical stocks — makers of fiber-optic connections that quickly shift data between users, hyperscalers, and all around data centers themselves — were up. Lumentum and Arista Networks, two popular optical stocks, were showing resilience.

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