C3.ai (NYSE:AI) Issues Earnings Results

C3.ai (NYSE:AI) released its quarterly earnings results on Wednesday. The company reported ($0.20) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.26) by $0.06, FiscalAI reports. C3.ai had a negative net margin of 187.95% and a negative return on equity of 62.44%. The company had revenue of $52.38 million for the quarter, compared to analysts’ expectations of $52.06 million. During the same period last year, the company earned ($0.37) EPS. The firm’s revenue for the quarter was down 25.4% compared to the same quarter last year.

Here are the key takeaways from C3.ai’s conference call:

• Turnaround initiatives showed early progress: Q1 revenue was $52.4 million, above guidance, while bookings grew 73% year over year and the company signed 22 enterprise agreements.
• Federal business was particularly strong, with bookings up 138% year over year. Management cited dissatisfaction with an incumbent provider, increased defense and intelligence spending, and additional greenfield opportunities as drivers of the pipeline.
• Cost reductions materially improved financial performance: non-GAAP expenses fell nearly $40 million year over year, gross margin increased to 50%, and free cash flow turned positive at $2.1 million versus negative $54.8 million in the prior quarter. The company ended the quarter with $651.1 million in cash and marketable securities.
• Management is repositioning around its agentic AI platform and the early-stage C3 Code product, which it says can rapidly build enterprise applications with minimal manual coding. However, C3 Code is only beginning to be marketed, and near-term investment in forward-deployed engineering is expected to reduce gross margin to the mid-40% range next quarter.
• Fiscal 2027 guidance remains consistent with substantial losses, calling for revenue of $210 million to $240 million and a non-GAAP operating loss of $123 million to $155 million. The company said its priority is establishing consistent quarter-over-quarter growth and eventually reaching free-cash-flow and non-GAAP profitability, but it did not provide a specific timeline.

C3.ai Price Performance

Shares of AI stock opened at $10.51 on Thursday. The firm has a market cap of $1.63 billion, a P/E ratio of -3.15 and a beta of 2.10. C3.ai has a 1-year low of $7.68 and a 1-year high of $20.22. The firm’s 50-day simple moving average is $9.47 and its 200-day simple moving average is $9.43.

Wall Street Analyst Weigh In

Several equities analysts recently issued reports on AI shares. Needham & Company LLC reissued a “hold” rating on shares of C3.ai in a research note on Thursday. Citizens Jmp reaffirmed a “market perform” rating on shares of C3.ai in a research note on Thursday, June 4th. UBS Group reiterated an “underperform” rating on shares of C3.ai in a report on Tuesday. Weiss Ratings raised C3.ai from a “sell (e+)” rating to a “sell (d-)” rating in a research note on Tuesday, August 4th. Finally, DA Davidson reissued an “underperform” rating and set a $7.00 price target on shares of C3.ai in a research note on Tuesday. One investment analyst has rated the stock with a Buy rating, four have issued a Hold rating and seven have given a Sell rating to the company’s stock. Based on data from MarketBeat.com, C3.ai presently has a consensus rating of “Reduce” and an average price target of $10.09.

Insider Buying and Selling

In other C3.ai news, CFO Hitesh Lath sold 20,000 shares of the stock in a transaction that occurred on Tuesday, August 4th. The shares were sold at an average price of $10.00, for a total transaction of $200,000.00. Following the transaction, the chief financial officer owned 363,106 shares of the company’s stock, valued at $3,631,060. This trade represents a 5.22% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Stephen Bradley Ehikian sold 50,542 shares of C3.ai stock in a transaction on Wednesday, July 1st. The shares were sold at an average price of $9.45, for a total transaction of $477,621.90. Following the completion of the transaction, the chief executive officer owned 651,130 shares in the company, valued at approximately $6,153,178.50. This trade represents a 7.20% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last three months, insiders have sold 1,241,760 shares of company stock valued at $13,084,895. Insiders own 26.50% of the company’s stock.

Institutional Trading of C3.ai

Institutional investors and hedge funds have recently made changes to their positions in the company. NewEdge Advisors LLC raised its position in shares of C3.ai by 48.7% in the 1st quarter. NewEdge Advisors LLC now owns 2,442 shares of the company’s stock worth $51,000 after buying an additional 800 shares during the period. Parallel Advisors LLC grew its position in C3.ai by 76.4% during the third quarter. Parallel Advisors LLC now owns 1,849 shares of the company’s stock valued at $32,000 after acquiring an additional 801 shares during the period. BOKF NA grew its position in C3.ai by 20.7% during the third quarter. BOKF NA now owns 4,709 shares of the company’s stock valued at $82,000 after acquiring an additional 809 shares during the period. Envestnet Asset Management Inc. increased its stake in C3.ai by 8.8% during the third quarter. Envestnet Asset Management Inc. now owns 12,560 shares of the company’s stock worth $218,000 after acquiring an additional 1,018 shares during the last quarter. Finally, Larson Financial Group LLC increased its stake in C3.ai by 683.6% during the third quarter. Larson Financial Group LLC now owns 1,481 shares of the company’s stock worth $26,000 after acquiring an additional 1,292 shares during the last quarter. 38.96% of the stock is currently owned by institutional investors and hedge funds.

More C3.ai News

Here are the key news stories impacting C3.ai this week:

• Positive Sentiment: Quarterly results exceeded expectations. C3.ai reported a loss of $0.20 per share versus the consensus loss of $0.26, while revenue of $52.38 million narrowly topped the $52.06 million estimate. The loss also improved from $0.37 per share in the year-earlier quarter. C3.ai Reports Q1 Loss, Beats Revenue Estimates
• Positive Sentiment: Management highlighted early turnaround progress. Bookings reportedly increased 73%, and free cash flow turned positive, potentially improving confidence in CEO Thomas Siebel’s renewed efforts to restore consistent growth and move the company toward sustainable profitability. C3.ai Q1 2027: Free Cash Flow Turns Positive as Bookings Surge 73%
• Neutral Sentiment: Full-year guidance signals a wide range of outcomes. C3.ai forecast fiscal 2027 revenue of $210 million to $240 million. The midpoint is close to, but slightly below, analyst expectations of roughly $224 million, leaving investors focused on whether bookings convert into revenue. C3.ai Outlines FY2027 Revenue Guidance
• Negative Sentiment: Revenue remains under pressure. Quarterly sales fell approximately 25% year over year, and second-quarter revenue guidance of $51 million to $55 million was below the consensus estimate of $56.6 million. Persistent operating losses and a negative net margin reinforce concerns about the pace of the turnaround.
• Negative Sentiment: DA Davidson reaffirmed an Underperform rating and set a $7 price target, implying substantial downside from the recent trading level. The call highlights continuing skepticism about C3.ai’s growth execution despite the earnings beat. C3.ai Earns Underperform Rating from DA Davidson

C3.ai Company Profile

C3.ai, Inc is a leading enterprise software provider focused on delivering scalable artificial intelligence (AI) and Internet of Things (IoT) solutions to large organizations. The company’s core offering, the C3 AI Suite, is a comprehensive, model-driven platform that unifies data ingestion, model development, and application deployment. Through its suite of tools, C3.ai enables customers to accelerate digital transformation initiatives by applying advanced machine learning, predictive analytics, and AI-driven insights across a broad range of business functions.

The C3 AI Suite provides a low-code environment for data scientists and application developers to rapidly design, test, and deploy enterprise-scale AI applications.