Wedbush says Palantir bear case is fictional as $23 billion is wiped from stock

Palantir’s share price closed down 7.3% on Thursday in New York, wiping out close to $23 billion in market value after a single post on X from Michael Burry, the investor made famous by the 2008 financial crisis bet depicted in The Big Short. Burry has since deleted the post, and Wedbush Securities pushed back.

What Burry said

Scion Asset Management founder Michael Burry argued that AI startup Anthropic is effectively “eating Palantir’s lunch,” citing Anthropic’s growth from $9 billion to $30 billion in annual recurring revenue in a matter of months. He said businesses are pivoting toward easier, cheaper and more intuitive solutions.

His sharpest line was: “It took $PLTR 20 years to get to $5 billion.”

Burry’s position has been consistent. Around September 2025, he disclosed a significant short on Palantir through long-dated put options and has remained bearish on the company since.

Why Wedbush disagrees

In a note to clients on Thursday, Wedbush analyst Dan Ives maintained an Outperform rating and a $230 price target on Palantir. Ives called the Anthropic threat “way overblown” and described the Burry narrative as “fictional.”

Wedbush’s central argument is that Burry is misreading what Palantir sells. Wedbush says Palantir’s core product is not a chatbot or an API. Instead, it describes Palantir’s offering as an ontology—a system that acts as a digital twin of an organisation, integrating data across an entire business to automate complex decision-making. Wedbush argues that this is not what Anthropic’s Claude does, and that Claude does not threaten that layer.

“This is NOT being disrupted by Claude,” the note said. “If anything, it's accelerated on the enterprise.”

The three pillars of the bull case

Wedbush outlined three reasons it believes the bear thesis is wrong.

1) The ontology moat

Wedbush said Palantir translates raw organisational data into AI workflows and that this “layer” makes AI usable at enterprise scale inside complex institutions. It argued that deep integration takes years to build and is not easily replaced by an API.

2) Deal momentum

Wedbush said it is hearing from customers that Palantir’s AI bootcamps are shortening sales cycles and driving faster deployment. It cited:

• Total customer count up 34% year-on-year
• US commercial customers growing closer to 50%
• Deals worth more than $1 million up 40% year-on-year
• Deals worth more than $10 million up 91%

3) Government and commercial scale

Wedbush also pointed to growth across both segments, citing:

• US commercial revenue up 137% year-on-year
• US government revenue up 66% year-on-year

It argued that as governments seek to cut headcount and increase efficiency through software, Palantir’s proposition aligns with the current environment.

The structural argument Burry makes

Burry’s case focuses on how Palantir makes money. Wedbush said Palantir deploys its own staff—Forward Deployed Engineers—into client operations for months at a time. Wedbush noted that Palantir’s 10-K categorises much of this as professional services, meaning the company charges for human labour as much as software. It contrasted this with Anthropic’s plug-and-play API approach.

The debate was further complicated in early March, when the Trump administration banned Anthropic from federal systems following a dispute over safety guardrails. Wedbush said this forced Palantir to remove Claude from its Maven Smart System used by the US military and rebuild parts of the platform.

Wedbush said the episode illustrated both how embedded Anthropic had become inside Palantir’s government contracts and how quickly that position could unravel.

What to watch next

Palantir’s next earnings report is expected to be the “real test” of both cases. Until then, the gap between Wedbush’s $230 price target and the $130 share price is where the argument stands.