Palantir stock tanks 13% on Trump defense cuts and CEO’s sell-off plans
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Shares of Palantir (PLTR-5.39%) dropped nearly 13% on Thursday morning amidst news that its CEO is planning a new share sales initiative and a media report indicating that the Trump administration has instructed the Pentagon to reduce the U.S. defense budget.
Palantir is recognized for developing AI software that specializes in big data analytics for defense agencies. On Thursday morning, its stock was trading at $98.
Read more: Palantir stock has been on a tear. But a reckoning could come soon
Earlier this week, Palantir disclosed in its regulatory filing that CEO Alex Karp plans to sell nearly 10 million shares of the company’s stock over the next six months. This announcement coincides with a report published by the Washington Post on Wednesday, which stated that Defense Secretary Pete Hegseth has instructed senior Pentagon leaders to develop plans for reducing the defense budget over the next five years.
The Trump administration is aggressively cutting government spending and reducing the federal workforce to trim the budget — a task led by Tesla (TSLA-2.07%) CEO Elon Musk, who Trump tapped to head the newly created Department of Government Efficiency.
While the initiative aims to rein in costs, concerns over reduced government budgets have unsettled Palantir investors. Despite this, the company’s stock remains strong, up 33% year-to-date and an impressive 328% over the past year.
