Barely a few days after news about Palantir’s unprofitable financials emerged, the company has now filed with the Securities and Exchange Commission for a direct listing of its common stock.
What Happened: The data analytics company would list its Class A shares on the New York Stock Exchange under the symbol “PLTR”.
In its SEC filing on Tuesday, the company said it estimated its total addressable market (TAM) to be worth about $119 billion. $56 billion of the TAM is in the commercial sector and the balance $63 million is estimated to be in the government sector.
The company clarified that there are two classes of stocks – Class A and Class B, but it is also seeking shareholder approval to authorize a third class of common stock — Class F.
Class A is entitled to one vote per share and Class B is entitled to 10 votes per share. If approved, Class F would be held by a voting trust established by founders, and each share would be entitled to a variable number of votes.
Why It Matters: Instead of raising funds through a public offering, the direct listing would enable existing Class A shareholders to sell their stake in the company through brokerage transactions on the exchange.
Based on estimates from private transactions, Palantir stock price on an as-converted basis fell in the range of $4.5 to $6.5 during the year ended December 2019.
From the beginning of the year till Aug. 21, the volume-weighted average price was $5.35, with the upper-end of the range at $8.5, according to the SEC filing.
In the consolidated and unaudited balance sheet, the company reported $33.5 million redeemable convertible preferred stock, approximately $2.1 billion of convertible preferred stock, additional paid-in capital over $2.5 billion, as of June 30.
Palantir reported an accumulated deficit of $3.96 billion.
The company said it suffered a net loss of $579.6 million in 2019, similar to the $580 million in net loss posted in 2018. It reported a net loss of $164.7 million in the first six months this year, down 41.3% from the $280.5 million in the similar period last year.
"We may never achieve or maintain profitability," Palantir said in the filing.