C3.ai(US:AI) ZACKSยท2025-07-24 16:21Core Insights - C3.ai is experiencing significant growth as it diversifies beyond its traditional oil and gas sector, with Q4 fiscal 2025 revenues reaching $108.7 million, a 26% increase year over year, marking three consecutive years of accelerating growth [1][9] - Non-oil and gas revenue surged by 48% year over year, with C3.ai now serving 19 industries, including manufacturing and healthcare, and public sector sales more than doubled in fiscal 2025 [2][4] - The company's strategy focuses on scaling through partnerships with major cloud providers, with 73% of deals in Q4 being partner-driven, indicating the importance of indirect sales channels [3][9] Financial Performance - Despite a net loss of 16 cents per share, C3.ai maintains a strong cash balance of approximately $750 million and generated positive free cash flow in the quarter [4] - The company projects continued revenue growth into fiscal 2026, with guidance between $447.5 million and $484.5 million [4] Competitive Landscape - C3.ai faces competition from Palantir Technologies and Veritone, both of which are also expanding into enterprise AI markets [5][6] - Palantir reported a 27% year-over-year increase in commercial revenue, while Veritone is focusing on AI solutions for media and law enforcement, overlapping with C3.ai's offerings [5][6] Stock Performance and Valuation - C3.ai's stock has increased by 29.1% over the past three months, outperforming its industry and the S&P 500 index [7] - The stock is currently trading at a forward 12-month price-to-sales (P/S) ratio of 7.98, which is lower than Palantir's 80.41 and Veritone's 1.1 [11] Earnings Estimates - The Zacks Consensus Estimate for fiscal 2026 and 2027 loss per share has improved to 37 cents and 16 cents, respectively, from previous estimates [13] - Sales growth estimates for fiscal 2026 and 2027 are projected at 20.1% and 21.8%, respectively [13]