Core Viewpoint - C3.ai Inc. reported a narrower-than-expected earnings loss for Q2 of fiscal year 2025, but concerns remain about its path to profitability and high valuations in the current market environment [2][3]. Financial Performance - C3.ai reported an earnings per share (EPS) loss of six cents, which was better than the anticipated loss of 14 cents per share [2]. - The stock initially dropped about 10% in premarket trading following the earnings report but rebounded to a 3% increase during mid-day trading [1]. Market Position and Demand - C3.ai has established itself as a provider of customizable AI applications for enterprise-level customers, filling a niche in the AI market [5]. - The company added 58 new agreements in the quarter, indicating strong demand for its services [6]. Partnerships and Growth - C3.ai's stock has surged over 78% since announcing an expanded partnership with Microsoft, where it became a preferred application provider on the Azure platform [6]. - The partnership includes a joint go-to-market strategy leveraging Azure sales channels [6]. Revenue Sources - Approximately 33% of C3.ai's revenue comes from government contracts, a decrease from 49% in the same quarter of 2023 [8]. - The company faces challenges in diversifying away from government contracts, which are costly to obtain and have long sales cycles [9]. Investment Sentiment - Short interest in C3.ai stock is over 17% of the float, suggesting potential volatility and a possible short squeeze [10]. - Analyst sentiment is mixed, with a consensus price target of $33.10, indicating a downside of over 23% from current levels [11]. Future Outlook - Many of C3.ai's current agreements are pilot programs, and it will take several quarters to determine which will lead to sustainable revenue [12].

Revenue Growth - Total revenue for the three and six months ended October 31, 2024, was $94.3 million and $181.6 million, representing a 29% and 25% increase compared to the same period last year[172]. - Subscription revenue grew to $81.2 million and $154.6 million for the three and six months ended October 31, 2024, representing a 22% and 21% increase compared to the same period last year[172]. - Total revenue for the quarter ended October 31, 2023, was $73.229 million, representing a year-over-year growth of 17%[1]. - Subscription revenue growth year-over-year was 23% for the quarter ended October 31, 2023[1]. - Subscription revenue accounted for 86% of total revenue for the three months ended October 31, 2024, increasing by $14.7 million, or 22%, compared to the same period last year[243]. - Subscription revenue for the six months ended October 31, 2024, was $154.6 million, a 21% increase from $127.8 million in the same period last year[244]. - The increase in subscription revenue was driven by 19% of total subscription revenue coming from new customers for the six months ended October 31, 2024[244]. Market and Product Expansion - C3 AI booked over $1.4 billion in additional contracts and recognized $1.3 billion in revenue from 2019 to 2024[166]. - C3 AI has expanded its product offerings to include over 100 AI production applications across various industries[165]. - The C3 Generative AI launched in early fiscal year 2024 includes 28 domain-specific offerings tailored to various industries[2]. - The company expects to continue attracting new customers through its consumption-based pricing model, which simplifies adoption[2]. - The company is focused on expanding its ecosystem of strategic partners, including notable partners like Baker Hughes, AWS, Microsoft, and GCP, to enhance customer engagement[215]. - A new global alliance agreement with Microsoft has been established, positioning the company as a preferred AI application software provider on Microsoft Azure, which includes joint sales and go-to-market strategies[216]. Financial Performance - Total cost of revenue for the three months ended October 31, 2024, was $36.5 million, a 14% increase from $32.1 million in the same period last year[248]. - Gross profit for the three months ended October 31, 2024, was $57.8 million, representing a 41% increase from $41.1 million in the same period last year[251]. - The subscription gross margin for the three months ended October 31, 2024, was 57%, up from 53% in the same period last year[251]. - Total operating expenses for the three months ended October 31, 2024, were $133.1 million, compared to $120.5 million in the same period last year[251]. - Net loss for the three months ended October 31, 2024, was $66.0 million, compared to a net loss of $69.8 million in the same period last year[243]. - Total operating expenses for the six months ended October 31, 2024, were $257,880 thousand, a 10% increase from $235,151 thousand in the same period last year[254]. Investment and Expenses - Research and development spending is anticipated to remain high as the company introduces new applications and features[2]. - Sales and marketing expenses are expected to increase in absolute dollar amounts as the company invests in brand awareness and programmatic spend to generate demand[229]. - Research and development expenses for the three months ended October 31, 2024, increased to $55,715 thousand, an 11% increase from $50,399 thousand in the same period last year[254]. - Operating expenses are expected to increase as a percentage of total revenue in the near term but are anticipated to stabilize and decline as the business matures[226]. Cash Flow and Financial Position - Free cash flow for the six months ended October 31, 2024, was $(32,390) thousand, an improvement from $(64,035) thousand in the same period last year[268]. - Net cash used in operating activities for the six months ended October 31, 2024, was $(30,651) thousand, compared to $(44,654) thousand in the same period last year[271]. - Cash and cash equivalents as of October 31, 2024, were $121.3 million, down from $167.1 million as of April 30, 2024[269]. - The accumulated deficit as of October 31, 2024, was $1.2 billion, indicating ongoing operating losses[269]. - The company expects to continue incurring operating losses and generating negative cash flows in the upcoming quarters due to planned investments[270]. International Market Presence - Approximately 13% of total revenue for the three months ended October 31, 2024, and 17% for the same period in 2023, was derived from international customers, indicating growth potential in international markets[217]. - The company derived approximately 13% and 16% of total revenue for the six months ended October 31, 2024, and 2023, respectively, from international customers, highlighting ongoing international growth[217]. - The company plans to increase its direct sales team in international markets and supplement efforts with strategic partners to expand market coverage[217]. Economic and Regulatory Factors - The impact of adverse macroeconomic conditions, such as inflation and supply chain disruptions, is being monitored as it may affect customer budgets and consumption[218]. - The company does not believe inflation has had a material effect on its business or financial condition[286]. - A hypothetical 10% change in foreign currency exchange rates may have a material impact on the company's financial statements[285]. - The company has entered into foreign currency forward contracts to hedge a portion of its forecasted foreign currency-denominated expenses[285]. Compliance and Governance - Management concluded that the disclosure controls and procedures were effective at the reasonable assurance level as of the end of the reporting period[288]. - There were no material changes in critical accounting policies and estimates compared to the previous fiscal year[281]. - The company has not used any derivative financial instruments to manage interest rate risk exposure[284].

C3 AI Announces Fiscal Second Quarter 2025 Financial Results Revenue Accelerated 29% Year-Over-Year and Guidance Raised for FY 2025 C3 AI and Microsoft Strategic Alliance to Accelerate Enterprise AI Adoption REDWOOD CITY, Calif. — December 9, 2024 — C3.ai, Inc. ("C3 AI," "C3," or the "Company") (NYSE: AI), the Enterprise AI application software company, today announced financial results for its fiscal second quarter ended October 31, 2024. "We had an outstanding quarter with strong top- and bottom-line perf ...

Shares of C3.ai (AI 2.29%) were surging last month as investors cheered a new partnership with Microsoft, a sign that the AI software company may finally be turning the corner after years of wide losses. Additionally, the company benefited from a strong report from Palantir, the software company that has best proven the market for AI services thus far.According to data from S&P Global Market Intelligence, the stock finished the month up 51%. As you can see from the chart below, the stock popped after the Mi ...

Core Insights - Analysts forecast C3.ai, Inc. (AI) will report a quarterly loss of $0.16 per share, reflecting a year-over-year decline of 23.1% [1] - Expected revenues are projected to be $91.01 million, indicating a 24.3% increase compared to the same quarter last year [1] - The consensus EPS estimate has remained unchanged over the last 30 days, suggesting stability in analysts' assessments [1] Revenue Estimates - Analysts estimate 'Revenue- Professional services' to be $9.85 million, representing a 45.2% increase from the prior-year quarter [3] - The 'Revenue- Subscription' is expected to reach $81.15 million, showing a 22.1% increase from the year-ago quarter [4] Gross Margin Projections - The estimated 'Gross margin- Professional services' is projected at 84.2%, up from 83% in the same quarter last year [4] - Analysts project the 'Gross margin- Subscription' to be 55.9%, compared to 53% from the previous year [5] Stock Performance - C3.ai shares have increased by 38.2% in the past month, significantly outperforming the Zacks S&P 500 composite, which rose by 5.8% [6] - C3.ai holds a Zacks Rank 2 (Buy), indicating expectations of outperforming the overall market in the near term [6]

Company Performance - C3.ai, Inc. closed at $36.75, reflecting a +1.55% change from the previous day, outperforming the S&P 500's daily gain of 0.05% [1] - The stock has increased by 45.69% over the past month, significantly higher than the Computer and Technology sector's gain of 4.59% and the S&P 500's gain of 5.75% [1] Upcoming Earnings - The company's earnings report is scheduled for December 9, 2024, with an expected EPS of -$0.16, indicating a 23.08% decline from the same quarter last year [2] - Revenue is forecasted to be $91.01 million, representing a 24.28% increase from the prior year quarter [2] Fiscal Year Estimates - For the entire fiscal year, the Zacks Consensus Estimates predict an EPS of -$0.53 and revenue of $383.04 million, reflecting changes of -12.77% and +27.86% respectively from the previous year [3] Analyst Projections - Recent shifts in analyst projections for C3.ai, Inc. should be monitored, as positive estimate revisions indicate optimism about the company's business outlook [4] Zacks Rank and Performance - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has shown that 1 stocks have returned an average annual gain of +25% since 1988 [6] - C3.ai, Inc. currently holds a Zacks Rank of 2 (Buy), with the consensus EPS estimate remaining unchanged over the last 30 days [6] Industry Context - The Computers - IT Services industry, part of the Computer and Technology sector, has a Zacks Industry Rank of 48, placing it in the top 20% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Explore the exciting world of C3.ai (AI -2.66%) with our expert analysts in this Motley Fool Scoreboard episode. Check out the video below to gain valuable insights into market trends and potential investment opportunities!*Stock prices used were the prices of Oct. 16, 2024. The video was published on Dec. 2, 2024. ...

Core Viewpoint - C3.ai is experiencing accelerated growth due to its focus on providing AI solutions, with a projected revenue growth rate of approximately 24% for the recent quarter, indicating a recovery from previous slowdowns [4][5]. Group 1: Company Performance - C3.ai's revenue for the recently completed quarter is projected to be between $88.6 million and $93.6 million, suggesting a year-over-year growth rate exceeding 20% [5]. - The company has seen a significant boost in growth following the release of OpenAI's ChatGPT, which has generated excitement around AI technologies [4]. - Despite the revenue growth, C3.ai is still struggling to achieve profitability, which is a critical factor for investor confidence [6][7]. Group 2: Market Sentiment - There is a high level of skepticism among investors, with short interest exceeding 23%, indicating doubts about the company's ability to sustain growth and achieve profitability [9]. - The upcoming earnings report on December 9 will be pivotal in shaping market sentiment and determining the stock's trajectory in the near term [2]. - If C3.ai fails to show meaningful improvement in earnings, it risks a sell-off, especially if growth begins to slow [10]. Group 3: Investment Considerations - Investors are advised to consider waiting until after the earnings report to make decisions regarding stock purchases, as the current market conditions present uncertainties [11]. - The stock has appreciated by 35% this year, but lingering questions about the company's long-term viability make it a risky investment [11].

I've grown increasingly impressed with the company's execution.The great thing about being a long-term investor is that it gives you time to change your mind when the facts demand it. C3.ai (AI -3.96%) didn't have the most impressive fundamental qualities a year or two ago, but the company has made strides to the point that it's time to give it its recognition as a potential stock investment.There aren't many companies selling artificial intelligence (AI) application software to governments and enterprises, ...

Artificial intelligence (AI) was hot again this week, and it wasn't just Nvidia's (NVDA -3.22%) earnings that were in focus. Super Micro Computer (SMCI 11.62%) was the huge winner, as it put forth a plan to become compliant with Nasdaq listing requirements.According to data provided by S&P Global Market Intelligence, Super Micro Computer's shares were up as much as 85% this week, C3.ai (AI 6.94%) was up 43.9%, and BigBear.ai Holdings (BBAI 11.87%) jumped 47.6%. At 3 p.m. ET on Friday, the stocks were up 78. ...