Palantir Is Growing 93% While Getting Rid of Its Sales Team

Good Morning. Google just paid $10 million for Spirit Airlines’ old corporate data so it can use it to train AI. Spirit went out of business, but apparently its internal files are still worth more than my annual quota. There’s probably a lesson in there somewhere about how every lost deal, customer complaint, and ugly sales call is still useful if you learn from it. Google just happens to have $10 million to prove that point. Now, let’s get into today’s Follow Up. (:

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On August 3, Palantir's CEO announced their revenue is up 93% YoY, to $1.9 billion.

In the same letter, he bragged that the sales team was "miniscule and shrinking."

Growing fast and downsizing the sales team. Two things that usually don't happen at the same time.

And it's not the first time Karp's talked about this. On the Q1 2026 call, he said the company has 70 salespeople total, and only about seven of them actually sell.

A normal company Palantir's size would have 1,000’s of sales reps to do the same volume of sales.

So today we're breaking down how this 20-year-old tech company makes billions with just a few sales reps, and whether this is what the future of sales will look like.

Trying to explain what Palantir does is sorta like trying to explain how Wifi works.

I think I understand it until I actually have to put it into words.

You can throw a bunch of technical words together, and it sort of describes what they do: AI, government intelligence, software, and infrastructure.

Now here's an actual explanation: Palantir was started in 2003 by Peter Thiel and a few PayPal alumni, including Alex Karp. The idea was that the fraud detection system PayPal built to catch cybercriminals could just as easily help catch terrorists.

So they sold that system to spy agencies and banks with the promise of connecting scattered, messy data into one picture a human analyst could actually use.

The company started with major contracts from the government, and these days works on everything from military logistics to hospital scheduling to regular AI-forward businesses.

Now let’s go back to what Karp said about their sales team.

70 people in the sales org, only 7 sellers, and apparently the sales team is still shrinking.

The thing he doesn’t mention is the company’s use of a role they call “forward-deployed engineers.”

Most software companies split engineering & sales into two separate departments. Engineers build the product, and the sales reps sell it. And finally, the rep hands the customer to an implementation team.

Instead of fully separating the two departments, Palantir uses a sort of hybrid role they call a “forward-deployed engineer” (FDE).

An FDE works directly inside the customer's business (sometimes on-site), to help build, customize, and implement the solution into the customer’s company.

Almost like a really good consultative sales rep who also happens to have technical skills.

One thing worth flagging so you don’t get the wrong idea: Palantir’s employee count isn't shrinking.

The company added roughly 500 employees in 2025. It's the sales headcount specifically that's staying flat while revenue climbs, because the forward-deployed engineers doing the actual selling get counted as engineering, not sales.

And the profit they're generating from all of that new revenue is also growing like crazy. In the same letter, he pointed out that Palantir made more in profit last quarter ($1.1B in Q2, FY26), than it made in total revenue during the same quarter a year earlier. ($1B revenue in Q2, FY25).

When you’ve got an extremely technical product, big government contracts, and 49% margins on billions in revenue like Palantir, you can afford to build your sales team like a special forces operation.

Chances are, your company doesn’t have the same technical moat or margins to copy Palantir.

Palantir spent its first 15 years selling almost entirely founder-led, straight to the government, with no real sales org at all.

Obviously that's not a normal sales strategy for most companies. 

Its first customers were intelligence agencies who don't purchase like a normal B2B buyer.  

Meanwhile, another popular kid in the news this year is taking the opposite approach. SpaceX is actively hiring for Starlink sales roles across a bunch of different verticals.

SpaceX is clearly taking a more traditional GTM approach and hiring sales reps to go sell their flagship product.

So… to answer the question: Are future sales teams going to look more like Palantir?

I don’t think so, but we’ll probably see many more companies hire FDEs. It’s already becoming one of the hottest roles in Silicon Valley. All thanks to Palantir.

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