Palantir Shares rose 23% to a record close on Tuesday after the data analytics software maker reported robust third-quarter results and gave upbeat revenue guidance.

The stock reached a closing high of $51.13, above the previous record of $44.97 set last week. The increase marks the stock’s biggest increase since February 6, when the stock gained 30%.

LSEG said revenue rose 30% year over year to $726 million, beating the average analyst estimate of $701 million. Adjusted earnings per share of 10 cents beat the average estimate of 9 cents.

Analysts at Deutsche Bank said in a report that “the hit was driven by better-than-expected performance from the U.S. government,” boosted by demand for artificial intelligence tools.

“Palantir is among a handful of infrastructure software companies that have begun meaningfully monetizing generative AI, with its competitive position benefiting from long-standing investments and deep expertise in complex data integration and, in particular, its reputation for data security built into its ontology,” the analysts said wrote.

Net income was $143.5 million, or 6 cents per share, up from $71.5 million, or 3 cents per share, in the year-ago quarter. The company forecast fourth-quarter revenue of $767 million to $771 million. Analysts polled by LSEG had expected $741.4 million.

Palantir is targeting U.S. commercial sales of more than $687 million for the year, representing about 24% of total revenue.

Bank of America increased its price target to $55 from $50 and maintained its Buy rating.

“We continue to see adoption of PLTR’s AI-powered products and reach in its early stages as more companies recognize the potential time, resource and cost savings,” Bank of America analysts wrote in a note to investors. “In our view, Palantir’s lead as a differentiated, agnostic AI enabler only grows with each new use case that brings ever-increasing unit economics.”

—CNBC’s Jordan Novet and Michael Bloom contributed to this report.