Palantir Technologies has created one of the most dramatic stories on Wall Street this year, defying conventional investment narratives. In 2025, it became the top-performing stock in the S&P 500, surging over 106% and at points climbing 144% from the start of the year—outpacing even AI heavyweights like Nvidia. This explosive growth was fueled by its robust financial performance, notching its first billion-dollar quarter with momentum from government and commercial AI contracts.
However, Palantir’s meteoric rise has been followed by a brutal reversal. Over the past six trading sessions, Palantir shares plunged more than 17%, wiping out $73 billion in market capitalization and marking the largest drop since April. This tumble handed short-sellers $1.6 billion in profits, Bloomberg reported, citing data from S3 Partners. (That figure is still dwarfed by the $4.5 billion paper losses that shorts racked up earlier in the year, S3 says.) In recent days, Palantir has also been the worst performer in the S&P 500, illustrating an extreme swing from hero to villain in the market.
