Palantir stock has been on a tear in 2025, rising more than 40% even after Tuesday's big drop. Analysts have expressed concerns about the AI firm's valuation.

(Reuters) -Shares of Palantir Technologies slumped about 7% in premarket trading on Tuesday, after quarterly results and a raised forecast failed to meet the high expectations of Wall Street investors, who had driven the stock price up significantly ahead of earnings.

Palantir raised its full-year outlook on strong demand for its AI software, but shares slipped in extended trading Monday as the company's results failed to impress.