Stock Market Today, April 9: Palantir Drops After Michael Burry Warns of Rising Competition From Anthropic | The Motley Fool

Palantir Technologies (PLTR 7.30%), a data analytics and AI software provider, closed Thursday at $130.49, down 7.30%. The stock dropped after criticism from investor Michael Burry about rising competition from Anthropic and the stock's rich valuation. Investors are watching how competitive pressure affects Palantir's AI revenue growth and government contracts.

Trading volume reached 90.8 million shares, coming in about 82% above its three-month average of 49.9 million shares. Palantir Technologies IPO'd in 2020 and has grown 1,274% since going public.

The S&P 500 (^GSPC +0.62%) added 0.61% to finish Thursday at 6,824, while the Nasdaq Composite (^IXIC +0.83%) rose 0.83% to 22,822. Within the software infrastructure sector, peers were lower by lesser amounts. Microsoft (MSFT 0.34%) closed at $373.07 (-0.34%) and Oracle (ORCL 3.70%) ended at $137.88 (-3.70%) amid scrutiny of AI and data center exposure.

"Big Short" investor Michael Burry has been critical of Palantir stock before. Now he says privately held Anthropic is "eating Palantir's lunch." And he added some details to back up his view.

Burry highlighted Anthropic's rapid growth, mentioning its surge from $9 billion to $30 billion in annual recurring revenue (ARR) within just a few months. This, he mentioned, demonstrates that businesses are shifting towards solutions that are "easier, cheaper, [and more] intuitive."

Palantir's valuation has always been a question. It needs to continue it's growth pace to justify the stock price. As evidenced today, investors may tend to sell first and look for that growth later, when there is uncertainty.