PLTR vs. COHR: Unlocking AI-Driven Tech Stock Upside Potential
Explore how Palantir and Coherent harness AI to fuel growth, with insights into their business models, financials, and valuations to help investors navigate AI-driven tech stock opportunities.
Key Takeaways
- Palantir’s U.S. commercial revenue surged 93% in Q2 2025, showcasing rapid AI adoption.
- Coherent posted 51% fiscal 2025 revenue growth, driven by a 61% jump in data center demand.
- PLTR trades at a much higher forward P/E than COHR, though both are below historical medians.
- Palantir excels in turnkey AI software deployment, while Coherent builds critical AI hardware.
- Investors face a choice between PLTR’s high-growth software momentum and COHR’s value in AI infrastructure.
Artificial intelligence is reshaping the tech landscape, spotlighting companies like Palantir Technologies (PLTR) and Coherent Corp. (COHR) that power AI’s promise in very different ways. Palantir’s software platforms, including its Artificial Intelligence Platform (AIP), are transforming how governments and businesses make decisions with data. Meanwhile, Coherent’s photonics and semiconductor technologies form the physical backbone enabling AI’s lightning-fast computations.
In 2025, Palantir’s U.S. commercial revenue skyrocketed 93%, while Coherent’s fiscal 2025 revenue grew 51%, fueled by surging demand for AI data center hardware. Yet, their valuations tell contrasting stories: PLTR trades at a steep forward P/E above 200, reflecting sky-high expectations, whereas COHR’s valuation sits attractively lower, hinting at value for patient investors.
This article dives into the AI-driven tech stock battle between PLTR and COHR, unpacking their business models, financial performance, and what investors should watch. Whether you’re chasing growth or value, understanding these players is key to navigating the AI investment frontier.
Comparing AI Business Models
Palantir and Coherent approach AI from opposite ends of the spectrum. Palantir is a software powerhouse, delivering enterprise AI platforms like Gotham, Foundry, and its Artificial Intelligence Platform (AIP). These tools help organizations—from government agencies to commercial firms—turn raw data into real-time decisions. Think of Palantir as the brain behind AI’s strategic moves, integrating autonomous AI agents directly into workflows to boost productivity dramatically.
Coherent, on the other hand, builds the physical components that make AI’s lightning-fast calculations possible. Its lasers, optical transceivers, and semiconductor materials are the unsung heroes powering data centers, autonomous systems, and edge computing. Without Coherent’s photonics, AI’s data highways would slow to a crawl.
This fundamental difference means Palantir’s growth rides on software adoption and contract wins, while Coherent’s fortunes hinge on hardware demand cycles and manufacturing scale. Both are essential, but their paths to AI success diverge sharply.
Unpacking Financial Growth Metrics
Numbers tell a compelling story. Palantir’s Q2 2025 U.S. commercial revenue surged an eye-popping 93% to $306 million, while its U.S. government sales rose 53% to $426 million. The total U.S. commercial contract value exploded 222% year over year, with customer count growing 43%. These figures underscore Palantir’s rapid scaling and sticky client relationships.
Coherent’s fiscal 2025 revenue grew 51%, led by a 61% jump in data center demand. Its shipments of 1.6T transceivers and expansion of indium phosphide manufacturing capacity by 3X highlight a company ramping up to meet AI’s hardware hunger. Communications revenues also rose 42% year over year, reflecting strong adoption of high-speed optical transceivers.
While Palantir’s growth dazzles, Coherent’s numbers reveal steady momentum in a cyclical, capital-intensive industry. Both companies are riding AI’s wave, but at different speeds and scales.
Valuation and Market Sentiment
Here’s where the plot thickens. Palantir trades at a forward 12-month P/E ratio of 202.65X, a sky-high multiple that signals investor expectations of blockbuster growth. Yet, this is still below its historical median of 267.56X, hinting at some valuation compression. Analysts remain cautious, with price targets suggesting potential downside despite Palantir’s strong fundamentals.
Coherent’s forward P/E stands at a more modest 18.93X, well below its median of 28.04X, suggesting it’s trading at a discount. This lower valuation reflects the cyclical nature of hardware markets and recent operational challenges but also offers a value proposition for investors betting on AI infrastructure expansion.
The contrast is stark: Palantir’s premium multiples bet on rapid software adoption, while Coherent’s bargain valuation invites patience for hardware market recovery.
AI Catalysts Driving Growth
Palantir’s AI momentum is fueled by its Artificial Intelligence Platform (AIP), which enables clients to deploy autonomous AI agents quickly and effectively. Its AIP bootcamps accelerate adoption, turning complex AI tech into user-friendly, scalable solutions. This turnkey approach has driven a 145% increase in remaining deal value to $2.79 billion and a 43% rise in customer count.
Coherent’s growth engine is its cutting-edge optical and semiconductor products. The company’s 1.6T transceivers, Optical Circuit Switches, and expanded indium phosphide production underpin the high-bandwidth, low-latency demands of AI data centers. Its multi-year deal with Apple for advanced laser products also strengthens its manufacturing base, a strategic edge as AI players seek secure domestic supply chains.
Both companies are essential cogs in AI’s machine—Palantir in software deployment, Coherent in hardware enablement.
Choosing Between Growth and Value
Investors face a classic dilemma: chase Palantir’s high-growth software surge or bet on Coherent’s value-rich AI hardware play. Palantir’s explosive revenue growth and expanding U.S. commercial footprint offer near-term upside but come with stretched valuations and competitive pressures. Coherent’s steadier growth and attractive valuation appeal to those seeking exposure to AI’s physical infrastructure with a longer-term horizon.
The decision hinges on risk tolerance and investment horizon. Palantir’s software-led momentum could reward bold investors willing to weather valuation swings. Coherent’s hardware foundation offers a strategic stake in AI’s backbone, with potential gains as capital spending rebounds.
Ultimately, understanding these distinct AI plays helps investors tailor their portfolios to the evolving tech landscape.
Long Story Short
Palantir and Coherent stand as two pillars of the AI revolution—one software-driven, the other hardware-focused. Palantir’s explosive commercial growth and turnkey AI solutions offer tantalizing upside, but come with valuation risks that make caution wise. Coherent’s role as a foundational AI hardware supplier positions it for steady long-term gains, especially as AI infrastructure expands globally. For investors, the choice boils down to appetite: PLTR’s rapid momentum and sector dominance versus COHR’s value play and cyclical rebound potential. Both carry risks—be it overvaluation or hardware market swings—but also unique opportunities to ride AI’s transformative wave. Ultimately, keeping a close eye on earnings trends, contract wins, and AI market shifts will be crucial. The AI story is still unfolding, and these two stocks offer distinct chapters in that narrative—each worth understanding before you commit your capital.