Shares of Palantir Technologies (NYSE: PLTR) charged out of the gate on Tuesday, spiking as much as 13.8%. As of 11:37 a.m. ET, the stock was still up 12.1%.

The catalyst that sent the artificial intelligence (AI) software and data mining specialist higher was the company's quarterly financial report and management's bullish commentary that suggested there was more to come.

You can't spell "gains" without "AI"

For the second quarter, Palantir generated revenue that accelerated to 27% year over year (and 7% sequentially) to $678 million.

This resulted in record net income, marking the company's seventh successive quarter of profitability according to generally accepted accounting principles (GAAP). Earnings per share (EPS) of $0.06 soared 500% year over year, while adjusted EPS of $0.09 rose 80%.

To give the results context, analysts' consensus estimates were calling for revenue of $652 million and adjusted EPS of $0.08, so Palantir cleared both bars.

The results were driven by robust U.S. commercial revenue, which surged 55% to $159 million, as customers flocked to the company's Artificial Intelligence Platform (AIP) and generative AI. The segment's customer count grew 83% year over year, while its remaining deal value -- or sales that have not yet been recognized as revenue -- soared 103%. Not only was new customer acquisition strong, but existing customers were spending more, as evidenced by a net dollar retention rate of 114%.

Classic beat and raise

Investor sentiment was also boosted by bullish commentary courtesy of chief revenue officer Ryan Taylor. He noted that the company's boot camps were wildly successful, saying they remained a "key go-to-market" strategy. He went on to describe numerous seven-figure deals that were signed within weeks of those customers attending a boot camp. CEO Alex Karp was equally bullish, calling it "an unprecedented opportunity."

The icing on the cake was Palantir's forecast, as management boosted its full-year guidance to roughly $2.75 billion at the midpoint of its guidance, which would represent year-over-year growth of 23%, while increasing estimates for U.S. commercial revenue to grow 47%, up from 45% just last quarter.

The AI gold rush is expected to continue for years if not decades, and Palantir is well positioned to profit from this secular tailwind, which is why the stock is a buy.

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Danny Vena has positions in Palantir Technologies. The Motley Fool has positions in and recommends Palantir Technologies. The Motley Fool has a disclosure policy.

Why Palantir Technologies Stock Rallied on Tuesday was originally published by The Motley Fool