Key Highlights
- C3.ai delivered $52.4 million in revenue for the quarter concluded in July, slightly surpassing the Street’s $52.1 million forecast
- The company’s adjusted per-share loss of 20 cents outperformed expectations of a 26-cent deficit
- Quarterly revenue declined 27% versus the prior year’s $70.3 million
- Forward guidance for the current quarter of $51M-$55M fell short of the $56.6 million consensus expectation
- Shares traded down 1% to $10.42 during Thursday’s premarket session, extending year-to-date losses to 23%
Shares of C3.ai were changing hands at $10.42 during premarket activity Thursday, slipping approximately 1% following the company’s quarterly results that topped estimates but delivered underwhelming forward projections.
The enterprise AI software company recorded $52.4 million in revenue for the three months ended July 31, marginally exceeding Wall Street’s $52.1 million projection. On an adjusted basis, the company posted a loss of 20 cents per share, outperforming the anticipated 26-cent shortfall.
At first glance, these figures appeared favorable. However, investors weren’t convinced.
The complete Refinitiv earnings data revealed a more concerning picture, showing an adjusted loss of 33 cents per share. This figure substantially missed the consensus analyst forecast of 26 cents and fell well beyond the projected range of negative 24 to negative 28 cents.
Top-line results showed a significant contraction, with revenue tumbling 27% compared to the same period last year, falling from $70.3 million to $51.3 million.
Chief Executive Thomas Siebel attempted to cast the results in an optimistic light. “The Company has done exactly what a disciplined, focused turnaround should do,” he stated in the official earnings announcement.
Subscription-based revenue, representing the majority of C3.ai‘s income stream, totaled $49.2 million. This figure increased modestly by less than 2% from the previous quarter but represented a steep decline from the $60.3 million recorded in the comparable year-ago period.
Forward Outlook Falls Short of Expectations
Looking ahead to the current quarter, C3.ai projected revenue between $51 million and $55 million. This range disappointed compared to the analyst consensus of $56.6 million. The guidance midpoint represents a shortfall of approximately $3-4 million versus expectations.
For the complete fiscal year, management issued guidance spanning $210 million to $240 million. The $225 million midpoint narrowly exceeds the Street consensus of $224.3 million.
Siebel resumed the chief executive position in early May following his departure last July to address an autoimmune condition that impaired his vision. He admitted that his health challenges had negatively influenced the company’s sales performance during his absence.
The stock hasn’t managed a closing price above $20 since August of last year and has declined 20% in 2026. The company’s all-time peak closing price reached $177 in 2020.
Street Maintains Conservative View
Analyst sentiment continues to reflect caution. The consensus rating currently stands at “hold,” comprising 1 buy recommendation, 7 hold ratings, and 6 sell or strong sell ratings. This contrasts with the peer group average of “buy.”
The median price target over the next 12 months is positioned at $9.00, representing roughly 17% downside from the most recent closing price of $10.52.
While the mean earnings forecast had climbed approximately 30% over the past three months, one analyst recently lowered their estimate within the last 30 days.
Prior to the earnings announcement, C3.ai shares had appreciated 13.8% throughout the reported quarter.
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