Palantir Strikes SAP Deal, But NHS Data Storm Clouds Loom Over Growth Story

The tension between Palantir’s breakneck commercial expansion and the political sensitivity of its government work has rarely been sharper. Just as the company unveiled a landmark alliance with SAP at the Sapphire conference on May 12, 2026 — a deal designed to embed its artificial intelligence platform into one of the world’s largest enterprise software ecosystems — a separate controversy in Britain’s National Health Service is testing the trust that underpins its public-sector business.

The SAP partnership targets a notorious bottleneck: migrating messy legacy systems to cloud-based ERP environments. Palantir’s Artificial Intelligence Platform (AIP) will be woven into SAP’s vision of the “Autonomous Enterprise,” using agent-driven toolchains to slash the cost and time of data migration. For Palantir, the deal unlocks access to thousands of multinational corporations that already run SAP software, reducing its historic reliance on defence and intelligence contracts. The company’s ontology technology is now positioned as a standard data management layer inside one of the world’s largest software ecosystems.

Analysts are taking notice. Freedom Broker raised its price target on Palantir shares to $230 from $170, citing the combination of rapid growth and expanding margins. Palantir’s so-called “Rule of 40” score — a metric that adds revenue growth to operating profit margin — hit 145%, built on 85% revenue growth and strong profitability. The US commercial segment alone surged 133% in the latest quarter to $595 million.

Yet the stock remains under pressure. It closed at €115.88 in European trading and is down roughly 19% year-to-date, still 36% below its 52-week high and 17.4% below its long-term moving average. High growth expectations leave little room for political noise, and that noise is getting louder across the Atlantic.

In the UK, Palantir’s role in the £330 million Federated Data Platform (FDP) project for NHS England has sparked fresh scrutiny. New administrative roles were approved that give external contractors — including Palantir employees — broader access to patient data within the National Data Integration Tenant (NDIT), a secure environment where data sits before being pseudonymised and distributed. Internal documents warned of risks to public trust in data protection and technical controls.

Should investors sell immediately? Or is it worth buying Palantir?

Palantir rejects the suggestion that its staff could misuse data. A company spokesperson described Palantir as a data processor that operates strictly under client instructions, calling any other use illegal and “technically impossible” given NHS safeguards. But for a firm that sells control guarantees to governments, perceptions matter as much as technical reality. Privacy debates can slow procurement and trigger additional compliance demands — a reputational risk that investors are watching closely.

None of this has slowed Palantir’s dealmaking. In the first quarter of 2026, the company closed 206 deals each worth at least $1 million, including 47 transactions over $10 million. Q1 revenue rose 85% year-over-year, and management raised its full-year revenue forecast to between $7.65 billion and $7.66 billion — growth of roughly 71% versus 2025. The SAP alliance is expected to help deliver on that ambitious target.

Palantir is also doubling down on industrial defence work through its “Warp Speed” platform, which optimises supply chains for munitions and military production. Rising defence budgets on both sides of the Atlantic are fuelling demand in that segment, providing a second growth leg alongside enterprise software.

The juxtaposition is stark: a company with best-in-class growth metrics and a string of strategic wins, yet trading below its average price because the market is pricing in execution and governance risks. The SAP deal offers a clean commercial narrative. The NHS debate, meanwhile, serves as a reminder that for Palantir, the data that powers its profits can also become a political liability. Every new detail about access rights, control chains, and data provenance will now be scrutinised — and that scrutiny is likely to move the stock.