Key Takeaways
- C3.ai posted quarterly revenue of $52.4 million for the period ending in July, slightly exceeding the Wall Street consensus of $52.1 million
- The company’s adjusted loss per share of 20 cents outperformed analyst expectations of a 26 cent loss
- Year-over-year revenue declined 27% from the prior year’s $70.3 million
- Forward guidance for the current quarter of $51M-$55M fell short of the $56.6 million analyst consensus
- Shares traded down 1% to $10.42 during Thursday’s premarket session, extending the year-to-date decline to 23%
Shares of C3.ai were changing hands at $10.42 during Thursday’s premarket session, down approximately 1%, following the release of quarterly results that topped estimates but delivered underwhelming forward guidance.
For the fiscal quarter concluded July 31, the enterprise AI software company delivered revenue of $52.4 million, marginally surpassing the Street’s $52.1 million projection. The adjusted loss per share registered at 20 cents, outperforming the anticipated 26 cent shortfall.
On the surface, those figures suggest a modest victory. However, investors were unconvinced.
The complication stemmed from the complete Refinitiv earnings data, which showed an adjusted loss of 33 cents per share. This figure missed the analyst mean estimate of 26 cents and landed well beyond the forecasted range of negative 24 to negative 28 cents.
The year-over-year revenue comparison revealed a 27% contraction, sliding from $70.3 million in the comparable period last year to $51.3 million.
Chief Executive Thomas Siebel attempted to put a positive spin on the results. “The Company has done exactly what a disciplined, focused turnaround should do,” he stated in the earnings announcement.
Subscription revenue, representing the lion’s share of C3.ai’s operations, totaled $49.2 million. This represented a modest sequential increase of under 2% from the April quarter but marked a significant decline from the $60.3 million recorded twelve months earlier.
Forward Outlook Falls Short
Looking ahead to the current quarter, C3.ai projected revenue in the range of $51 million to $55 million. Wall Street analysts had been anticipating $56.6 million. The guidance midpoint represents a shortfall of approximately $3-4 million.
The company’s full-year revenue outlook was established at $210 million to $240 million. The $225 million midpoint narrowly exceeds the analyst consensus estimate of $224.3 million.
Siebel resumed his position as CEO in early May following a departure last July to address an autoimmune condition that impaired his eyesight. He conceded that his health challenges had negatively affected the company’s sales performance during his absence.
The stock hasn’t registered a closing price above $20 since August of last year and has surrendered 20% of its value in 2026. The company’s all-time peak closing price of $177 dates back to 2020.
Street Maintains Reserved Outlook
Analyst sentiment continues to lean cautious. The prevailing average rating stands at “hold,” comprised of 1 buy rating, 7 holds, and 6 sell or strong sell recommendations. By comparison, the peer group average rating is “buy.”
The median price target over a 12-month horizon is positioned at $9.00, representing a downside of roughly 17% from the most recent closing price of $10.52.
While the mean earnings forecast had climbed approximately 30% over the preceding three months, one analyst implemented a negative revision to their estimate within the past 30 days.
Prior to the earnings announcement, C3.ai stock had appreciated 13.8% during the reporting quarter.
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