Palantir rebuts claims of security flaws after stock falls

(Bloomberg) — Palantir Technologies Inc. (PLTR)’s stock fell more than 8% on Friday following a report that its battlefield communications system, along with that of defense tech firm Anduril Industries Inc., was seriously flawed — a claim both companies said was out of date and inaccurate.

In a statement Friday, Palantir said that issues in the report, published by Reuters, had already been addressed. The report centered on a September Army memo expressing concerns over Anduril’s NGC2 prototype system, which stands for Next Generation Command and Control, and includes subcontractors Palantir and Microsoft Corp.

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The Army has said the problems with the system were “mitigated immediately,” Palantir said, adding, “No vulnerabilities were found in the Palantir platform.”

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Friday’s share move was the biggest intraday decline for Palantir since August, after a remarkable upward trajectory for the stock, which has gained more than 2,000% in the last three years. Other tech companies also slipped Friday following threats from the White House to lay off government workers.

In a story published this week about the Army report by the website Breaking Defense, Lieutenant General Jeth Rey stressed that finding security vulnerabilities was an important part of integrating advanced technology.“This is a new capability coming in and we found a risk and we mitigated it right out the gate,” he said.

According to the Army the memo dated Sept. 5, reported by Breaking Defense and Reuters, the communications networks for the companies had been vulnerable to “insider threats, external attacks, and data spillage,” with “critical deficiencies in fundamental security controls, processes, and governance,” before the interventions.

In a statement, Anduril also said that problems had been addressed. “The recent report reflects an outdated snapshot, not the current state of the program,” the company said. “NGC2 is progressing through the normal process of iterative development, we find risks early, address them quickly, and harden the system before fielding.”

Representatives for the Army did not immediately respond to requests for comment.

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