Why C3.ai Stock Lost 25% in February

Core Viewpoint - C3.ai has experienced a significant decline in stock value due to a challenging macroeconomic environment and disappointing earnings report, resulting in a 25% loss by the end of the month [1]. Group 1: Company Performance - C3.ai was initially a winner in the AI sector but has struggled to maintain momentum, with its stock price largely stagnant after an early 2023 surge [2]. - The company reported a 26% increase in revenue for the fiscal third quarter, reaching $98.7 million, surpassing analyst expectations of $98.1 million [4]. - Despite revenue growth, C3.ai remains unprofitable, posting an operating loss of $87.6 million on a GAAP basis, although it reported a per-share loss of $0.12, which is an improvement from $0.13 a year ago and better than the consensus estimate of a $0.25 loss [5]. Group 2: Future Outlook - C3.ai's fourth-quarter guidance suggests continued growth, forecasting revenue between $103.6 million and $113.6 million, indicating a 25.5% growth at the midpoint, consistent with previous quarters [7]. - The company's reliance on stock-based compensation is raising concerns, as it dilutes shareholders by nearly 10% year-over-year, which may affect investor confidence regarding its path to profitability [7][8].