Palantir Technologies Inc. (NASDAQ:PLTR) faces a potential setback in Europe as France and Germany begin seeking alternative suppliers for military software, raising questions about the company’s long‑term position in the region.
"To foster data sovereignty, France and Germany will examine the development of a European sovereign digital backbone," the two countries said in a joint declaration on Friday. They will take "consideration of data-centric security, artificial intelligence, and cloud solutions from both countries," the nations said after talks between Chancellor Friedrich Merz and President Emmanuel Macron.
The statement pointed to the French Arcadia solution "as well as comparable German solutions." The French Army has tested Arcadia in exercises as a replacement for the Maven Smart System developed by Palantir, Defense News reported.
Europe is considering reducing its dependence on the US for defense and tech amid growing strain with Washington. Disagreements over Ukraine, ongoing US military operations against Iran, and trade tensions have pushed the region to turn to domestic alternatives.
US contractors, including Palantir, Lockheed Martin Corp. (NYSE:LMT) and RTX Corp. (NYSE:RTX), are watching European governments accelerate defense spending.
