Palantir under fire as WikiLeaks accuses it of expanding the “American surveillance state”

Data analytics firm Palantir Technologies (PLTR) is under fire over its alleged role in bolstering state surveillance under President Trump. And some analysts warn that reputational fallout could weigh on the stock.

The latest blow came from WikiLeaks, which labeled Palantir a “spyware company” engaged in mass data collection on American citizens. The group cited the company’s extensive federal contracts involving sensitive personal data as evidence.

WikiLeaks specifically pointed to President Trump’s March executive order, which requires federal agencies to break down internal data silos and streamline information sharing.

That order has already sent millions in new contracts Palantir’s way.

Palantir’s Foundry platform is now in use across at least four major federal agencies, including the Department of Homeland Security, according to WikiLeaks.

Concerns aren’t just coming from outside critics. Thirteen former Palantir employees signed a letter to NPR warning that the company’s work under the Trump administration could significantly amplify the federal government’s surveillance capabilities.

In a statement, Palantir pushed back on the criticism, saying it “never collects data to unlawfully surveil Americans.” Nevertheless, the libertarian backlash is picking up steam.

Wall Street shrugs off the controversy... for now

Palantir remains one of Wall Street’s top-performing tech names in 2025.

The stock is up 72% year-to-date, largely thanks to a wave of retail investor and renewed enthusiasm around government AI contracts. But involvement in public data could be a double-edged sword, analysts say.

“They probably benefit a little bit more with Trump because of the impetus on security, border and immigration,” said Francisco Bido, senior portfolio manager at F/m Investments. “They’re going to get a lot of work out of that.”

Others were more blunt.

“Being intrusive is also profitable for vengeance-fueled despotic governments,” said journalist Robert Young Pelton, dismissing the recent rally as a fleeting fad that could come crashing down as quickly.

Jason Bassler of the Free Thought Project compared Palantir’s approach to a “Patriot Act on steroids,” invoking post-9/11 policy creep as a warning.

Even some former officials are raising red flags. Martin O’Malley, former governor of Maryland and a longtime privacy advocate, warned that Palantir could soon gain access to highly sensitive personal data — such as Social Security records — under the Trump administration’s expanded data-sharing rules.

“So much for the law which promised that the data would always be protected and restricted to the purpose of the Social Security Act,” O’Malley wrote.

For now, investors have brushed off the controversy. But if the surveillance backlash grows louder — or if regulatory scrutiny ramps up — Palantir’s sky-high valuation might get a haircut.