(Bloomberg) — Palantir Technologies Inc. plans to build a new big data platform in partnership with South Korea’s Hyundai Heavy Industries Group. The move could position Palantir to boost its growing commercial business outside the U.S.
Hyundai Heavy will use Palantir’s data analysis software to improve the way its affiliate groups operate in fields including shipbuilding, offshore engineering and energy and industrial machinery processes, the companies announced Tuesday at the CES trade show in Las Vegas. The multiyear deal is valued at more than $25 million, according to a person familiar with the arrangement who asked not to be identified discussing private information.
Once the platform is built, the companies will create a joint venture to commercialize the new tools, a move that could help Palantir software gain traction with global industrial companies. Chief Operating Officer Shyam Sankar said the project represented a new model, allowing customers to only pay for what they use, and exercise more control over the process.
Although Palantir raised its 2021 outlook, in its most recent earnigns report, the company produced slimmer-than-expected profit margins. It also failed to more quickly expand its client base from the U.S. government and its allies. Since the company announced its third-quarter results in November — and disclosed more than a dozen new commercial clients that signed deals worth over $10 million — its share price has fallen 25%.
The Hyundai Heavy joint venture, like Palantir’s deal with International Business Machines Corp., expands Palantir’s sales team focused on commercial customers. The arrangement is not Palantir’s first push into South Korea — it formed a strategic partnership with Doosan Infracore Co. two years before Hyundai acquired a stake in Doosan in 2021. The deal also fortifies Palantir’s connection to a key U.S. ally.
In a statement, Palantir Chief Executive Officer Alex Karp praised Hyundai Heavy as a company whose “continued growth and success are critical to our collective welfare and security.”
Since Karp, alongside Peter Thiel and others, co-founded Palantir in 2003 to serve U.S. defense needs, the company has grown to serve governments in the U.K., Australia and other allied countries. When Palantir went public in 2020, it did so with the avowed mission to only sell its software to countries allied with the U.S. and western democracies. Karp and other executives have emphasized this allegiance, publicly shunning China and calling for other companies to do the same.
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