Yahoo Finance·2025-09-24 13:49Core Insights - C3.ai has acknowledged its poor performance, attributing it to ineffective sales execution and leadership changes, leading to a restructuring of its sales and services departments [1] - The company reported a significant revenue decline of 19% year-over-year in Q1, with total revenue at $70.3 million, primarily driven by a drop in software licensing revenue [2][3] - C3.ai's stock has decreased by 47% year-to-date and over 60% from its all-time high, raising concerns among investors [3] Financial Performance - In Q1, subscription revenue was $60.3 million, while software licensing revenue fell to $17.9 million, a decrease of $15.9 million sequentially [2] - The company incurred net losses of $49.8 million, equating to $0.37 per share, and reported negative free cash flow of $34.3 million [2] - C3.ai has $711.9 million in cash but continues to experience significant cash burn each quarter [2] Future Outlook - For Q2, C3.ai has guided revenue expectations between $72 million and $80 million, down from $94.3 million in the same quarter last year, with operating losses projected between $49.5 million and $57.5 million [6] - The company has withdrawn its full-year outlook, indicating substantial uncertainty about its future performance [6] Market Sentiment - Analysts have expressed negative sentiment towards C3.ai, with major firms like Morgan Stanley and J.P. Morgan issuing "Sell" recommendations and lowering target prices [8] - The stock is currently rated as a "Hold" by Wall Street, with varying opinions from analysts, including three "Strong Buy," six "Hold," and four "Strong Sell" ratings [9] Product and Competitive Position - Despite challenges, C3.ai has a robust product portfolio with over 131 enterprise AI applications and a new Agentic AI platform gaining traction [7] - However, declining sales and increasing losses have led to a lack of investor confidence in the company's ability to deliver consistent growth and profitability [10]