Palantir, Miivo AI, and IBM: The Multi-Billion-Dollar SMB Market – How to Capitalize on Untapped AI Integration in Your Portfolio

Palantir: Strong Quarterly Results

The Foundry technology platform and AIP certainly offer solutions for data-driven decision-making in small and medium-sized businesses. The ontology, as the core component, promises knowledge consolidation and agility within the company. However, the costs for these platforms are quite high, making them seem oversized for the vast majority of SMBs. That is why Palantir has teamed up with SAP, Oracle, and others to reach SMBs as well. As things stand, a Palantir solution only pays off when business-critical pain points, such as machine breakdowns, occur on a six-figure scale.

On August 3, the company released its second-quarter results, which underscore this positive trend. Revenue climbed 93% to USD 1.935 billion. This marks the highest growth rate in the company's history. The US Commercial division stood out in particular, growing 149% to UDS 764 million. The operating margin stood at 62%. In total, the company secured 220 contracts with a value of at least USD 1 million. Seventy-three of these contracts were even worth more than USD 10 million. The total contract value reached USD 3.373 billion, an increase of 49% compared to the previous year. Free cash flow stood at USD 1.22 billion, and cash reserves at USD 9.2 billion.

Companies are increasingly demanding control over their data and AI models to protect their competitive advantages accordingly. With AIP, Palantir enables the exchange of models without being tied to a single provider. Management has raised its full-year revenue forecast to between USD 8.15 billion and USD 8.158 billion. Despite these successes, valuing the stock remains challenging. With a price-to-earnings (P/E) ratio of over 70, the stock is anything but a bargain. While the quarterly results justify optimism, expectations are already very high. Palantir must maintain its growth momentum to justify this valuation.

Miivo AI: Systematically Expanding Its Business

Canadian company Miivo AI has broadened its product portfolio with the launch of its new Customer Insights tool. The solution enables small and medium-sized businesses to monitor customer feedback from platforms such as Google Reviews, Instagram, and Reddit in real time and respond using AI-powered capabilities. This is particularly interesting for B2C businesses such as restaurants, hotels, or gyms, where online reputation can significantly influence business performance. Designed as a self-service solution, the platform requires minimal onboarding and training—an important advantage for SMBs, which often lack the time and resources for complex implementations or costly external consulting. The AI analyzes customer sentiment and emerging trends, generates actionable recommendations, and automates responses, delivering meaningful efficiency gains in day-to-day operations.

The new offering represents the third pillar of Miivo AI's expanding platform. Following the Business Intelligence solution for financial and operational data and the Lead Finder for sales acquisition, Customer Insights rounds out the offering. The idea behind this is that companies can consolidate relevant information from sales, customer interactions, and finance in a single environment, helping reduce complexity while improving operational efficiency. This customer-centric development approach has become a defining feature of Miivo AI. The solutions are always developed in close collaboration with existing customers. New capabilities are built in close collaboration with existing clients, and once a feature demonstrates broad demand, it is standardized and scaled across multiple industries. With the recent rebranding from Miivo Holdings to Miivo AI, the company has once again underscored its strategic focus on artificial intelligence.

The acquisition of Tandem Partners provides Miivo AI with an established sales network to support its next phase of growth. The consulting firm brings a strong regional presence and long-standing client relationships, creating a valuable channel for expanding the reach of Miivo's solutions. Through Tandem, the company can also establish partnerships with accounting firms and software providers, significantly strengthening its go-to-market strategy. Focusing on small and medium-sized businesses is a strategically sound approach, as they account for around 90% of all businesses worldwide and contribute more than 40% of private-sector GDP in many countries. At the same time, AI adoption within this segment remains relatively low, presenting a significant growth opportunity that Miivo AI aims to capture.

IBM: Working on the Future

IBM has specifically designed its watsonx platform for small and medium-sized businesses. The modular ecosystem consists of four modules to choose from, significantly lowering the barriers to entry. The approach supports not only IBM's own Granite model but also, for example, Google's models. A free trial version is available, and the Essentials Edition allows users to get started and test the platform risk-free. The Standard Edition, which offers a robust feature set, costs USD 1,050 per month. The system enables business units to automate workflows in HR, sales, or customer service without relying on IT resources. At the same time, it is possible to integrate everything into existing software tools such as Salesforce, etc.

The latest quarterly figures painted a mixed picture. Revenue rose by 1% on a currency-adjusted basis to USD 17.16 billion. The main problem in the last quarter was the infrastructure business. Mainframe revenue plummeted by 42%. Management attributes this to a timing effect, as major customers shifted their budgets to servers at short notice to stock up ahead of the expected price increase. The software business, which now accounts for nearly 45% of consolidated revenue, grew by 5.1%. About 80% of software revenue is recurring, which has a stabilizing effect. The full-year forecast was lowered to currency-adjusted revenue growth of 4% to 5%, while the free cash flow target remains unchanged.

IBM is positioning itself as a platform provider for complex AI environments. The consulting business is already benefiting from rising demand. With Lightwell, IBM is also targeting the cybersecurity market, which is likewise experiencing strong growth. The company has already secured its first major clients in this area, such as Bank of America and Goldman Sachs. In quantum computing as well, IBM is demonstrating a new approach in collaboration with the University of Chicago. The acquisition of HRL Laboratories is intended to complement its expertise in silicon spin qubits. IBM plans to invest over USD 10 billion in quantum computing over the next five years.

The untapped potential for AI integration in the mid-market presents opportunities for investors. Palantir's strong quarterly results demonstrate the high demand, but the company is highly valued and is only of interest to larger mid-market companies. Miivo AI specifically addresses operational pain points in B2C SMBs with its new Customer Insights tool and is systematically expanding its AI platform. IBM is lowering the barriers to entry for smaller companies with its modular watsonx platform, which is paying off in its growing software business.