Palantir Technologies Inc. saw its stock plummet more than 11% this week, despite posting stronger-than-expected quarterly earnings, leading CEO Alex Karp to lash out at short sellers and label their actions as "market manipulation." The Colorado-based software company, known for its data analytics and AI platforms, reported third-quarter revenue of $1.18 billion on November 4, 2025, marking a 63% jump from the previous year, with earnings per share at $0.21—both figures surpassing Wall Street analysts' projections.
Karp, in a pointed interview on CNBC's "Squawk Box" on Tuesday, November 11, 2025, took aim at investors betting against Palantir and other AI-driven firms. He specifically highlighted the positions of Michael Burry, the investor famous for predicting the 2008 financial crisis and featured in the film "The Big Short." Burry recently disclosed bearish bets against Palantir and chipmaker Nvidia Corp., which Karp described as irrational given the companies' strong performances.
"The two companies he’s shorting are the ones making all the money, which is super weird," Karp said during the Tuesday appearance. "The idea that chips and ontology is what you want to short is bats— crazy." He went on to suggest that such short positions were not only misguided but harmful to the broader economy.
By Friday, November 14, 2025, Karp escalated his criticism in another CNBC interview with Sara Eisen. Referring directly to Burry's moves, he stated, "To get out of his position, he had to screw the whole economy by besmirching the best financials ever." Karp's comments came as Palantir's shares closed at $177.93 that day, according to data from Benzinga Pro, down from a record high of $207.52 earlier in the week on Monday.
The stock's volatility followed a sharp 8% drop immediately after the earnings release and another nearly 7% slide on Thursday. Despite these setbacks, Palantir's shares have enjoyed a remarkable run in 2025, surging 136.64% year-to-date and pushing the company's market capitalization above $421.93 billion. This growth has positioned Palantir as a key player in the AI sector, alongside giants like Nvidia and Meta Platforms Inc.
Karp emphasized that the recent boom in Palantir's stock price benefits not just institutional investors but also everyday retail traders. "The recent boom in Palantir's share price isn't just for Wall Street, but for retail investors," he told Eisen, underscoring the company's appeal to a broad investor base amid the AI hype.
Critics, however, point to Palantir's lofty valuation as a red flag. The stock currently trades at about 220 times forward earnings, a multiple comparable to that of Tesla Inc., which has faced its own scrutiny for high valuations. In contrast, Nvidia trades at a forward price-to-earnings ratio of 33, while Meta's stands at 22, highlighting the disparity in how the market prices these tech firms.
Short seller Andrew Left of Citron Research has been vocal about his skepticism. In August 2025, Left described Palantir as "detached from fundamentals and analysis" and set a price target of $40 per share, far below its current levels. His comments reflect a broader debate among investors about whether Palantir's rapid ascent is sustainable or inflated by AI enthusiasm.
"To get out of his position, he had to screw the whole economy by besmirching the best financials ever," Karp said of Burry in his Friday CNBC interview, framing the short selling as an attack on strong-performing companies.
Palantir, founded in 2003 by Peter Thiel and others, has built its reputation on providing data integration and analytics tools to government agencies and large corporations. Its ontology-based software helps organizations make sense of vast datasets, which has become increasingly valuable in the era of artificial intelligence. The company's third-quarter results, announced from its headquarters in Denver, Colorado, showcased robust demand, with revenue growth driven by both commercial and government contracts.
Yet, the post-earnings sell-off suggests investor concerns over profitability and competition in the crowded AI space. Analysts have noted that while Palantir beat expectations, the stock's premium pricing leaves little room for error. Benzinga’s Edge Stock Rankings give Palantir a Growth score of 93.12, indicating strong potential but also underscoring the risks tied to its valuation.
Karp's repeated blasts at short sellers are not new; he has previously criticized those betting against AI leaders, arguing that such moves undermine the sector's momentum. In his Tuesday remarks, he called it "strange" that companies generating the most profits in AI were being targeted, adding that betting against firms driving the industry was "irrational." This perspective contrasts with short sellers like Burry and Left, who see overvaluation as a bubble waiting to burst.
For context, Michael Burry's Scion Asset Management revealed its short positions in regulatory filings earlier this year, including puts against Nvidia and Palantir. Burry, who gained fame for shorting the housing market before the 2008 crash, has a track record of contrarian bets. His current stance on AI stocks echoes warnings from some market observers about a potential tech bubble, similar to the dot-com era.
Meanwhile, Nvidia, another target of Burry's shorts, has seen its own stock soar on the back of AI chip demand, though it too faced volatility. Meta Platforms, mentioned in comparisons, has focused on AI integrations in its social media and advertising businesses, maintaining a more conservative valuation. Tesla, often cited alongside Palantir for its high multiples, reported its own earnings recently, with investors watching CEO Elon Musk's compensation milestones—reminding that a $1,000 investment in Tesla stock from 2018 would now be worth significantly more, according to related analyses.
As Palantir navigates this turbulence, the broader implications for the AI market are clear: enthusiasm for the technology continues to drive valuations, but skepticism from short sellers could introduce more volatility. Investors will be watching upcoming quarters to see if Palantir can maintain its growth trajectory. Karp's outspoken defense may rally supporters, but it also highlights the divide between bulls and bears in the high-stakes world of tech investing. With shares still up dramatically for the year, the company's future hinges on delivering consistent results amid ongoing market scrutiny.