Palantir Technologies Inc. has signed a deal with Microsoft to integrate Microsoft’s large language models via Azure OpenAI service with Palantir’s AI Platform in government and classified cloud environments. The integration aims to allow operators to safely build AI-driven operational workflows across defense and intelligence verticals.
Wall Street analysts have called the Palantir-Microsoft deal potentially game-changing. Dan Ives of Wedbush has given an Outperform rating and a $38 price target on Palantir shares. Ives noted that this marquee deal would help accelerate Palantir’s AI Platform adoption within the federal sector.
The AI industry is currently experiencing dynamic growth, with significant advancements expected across many sectors in 2024. Generative AI, which saw huge growth in 2023, is expected to continue expanding.
Palantir and Microsoft AI integration
This growth presents opportunities to unlock trillions of dollars in value as businesses move from pilot projects to wider implementation. The generative AI market is forecast to grow at a compound annual growth rate of nearly 60%, reaching a value of around $37 billion by 2028. This surge is driven by the increased adoption of AI technologies across various domains such as healthcare, finance, and customer service.
The healthcare sector expects major advancements due to AI, with its market projected to grow to around $188 billion by 2030. Innovations in genomics, drug discovery, and personalized medicine will drive this growth. Edge computing is also expected to see substantial developments, critical for enabling AI applications needing real-time data processing, particularly in sectors like autonomous vehicles, IoT, and industrial automation.
While Palantir is considered a notable investment within the trending AI stocks, there are other AI stocks believed to offer even higher returns in a shorter timeframe. Overall, the AI sector is poised for significant growth and transformation, bringing both opportunities and challenges, particularly concerning the ethics and responsibilities of AI deployment. The collaboration between Palantir Technologies and Microsoft is a landmark step in this evolving landscape.
