Financial Data and Key Metrics - Total revenue for Q1 FY25 was $87.2 million, a 21% YoY increase, exceeding analyst expectations [7][8] - Subscription revenue grew 20% YoY to $73.5 million, representing 84% of total revenue [8][27] - Non-GAAP gross profit was $60.9 million with a 70% gross margin [8] - Non-GAAP operating loss was $16.6 million, better than the guidance of $22 million to $30 million [8] - Net cash provided by operating activities was $8 million, and free cash flow was $7.1 million [8] - The company ended the quarter with $762.5 million in cash, cash equivalents, and marketable securities [28] Business Line Data and Key Metrics - The company closed 71 agreements in Q1, including 72 new pilots, marking a 117% YoY increase in pilot count [9] - State and local government business grew over 500% YoY, with 25 agreements signed in Q1 [9][12] - C3 AI Federal business represented over 30% of bookings for the quarter, with new agreements signed with the U.S. Air Force, Navy, Marine Corps, and Intelligence Community [13] - Partner-supported bookings grew 94% YoY, with 72% of total agreements closed through the partner ecosystem [15][16] Market Data and Key Metrics - The company expanded its footprint in state and local governments across multiple U.S. states, including Texas, California, and Florida [9] - The public sector market in Europe is expected to more than double the addressable market [12] - The company signed 40 agreements with Google Cloud in Q1, a 300% YoY increase, driven by joint campaigns focused on the public sector [16] Company Strategy and Industry Competition - The company is focused on expanding sales capacity in North America, Europe, and the public sector [15] - C3 AI's platform is designed to deliver pre-built AI applications quickly, differentiating it from legacy software companies and modern data integration platforms [18][19][20] - The company leverages partnerships with hyperscalers like AWS, Google Cloud, and Microsoft to drive workload in their compute and storage clouds [16] Management Commentary on Operating Environment and Future Outlook - Management highlighted the complexity of the AI market, particularly with the advent of generative AI, and the difficulty in modeling the business [42][43] - The company expects to be free cash flow positive in Q4 FY25 and for the full fiscal year, despite short-term pressure on gross and operating margins due to higher pilot mix and investments in sales, R&D, and marketing [30][32] - Revenue guidance for Q2 FY25 is $88.6 million to $93.6 million, with full-year guidance maintained at $370 million to $395 million, implying a YoY growth rate of 19% to 27% [31] Other Important Information - The company launched C3 Generative AI for government programs in Q1, with a pilot signed with a state on the U.S. East Coast [24] - C3 AI's customer base continues to expand, with significant success in improving manufacturing outcomes for Nucor Corporation and enhancing grid resiliency for Eletrobras [14][15] Q&A Session Summary Question: Tone of business in Q1 and deal size - The tone of business was described as "wild," with generative AI driving complexity and unexpected opportunities in sectors like public sector, law firms, and medical diagnostics [41][42][43] Question: Why guidance didn't increase despite strong bookings - The company maintained its full-year revenue guidance of $370 million to $395 million, representing 19% to 27% YoY growth, as it remains one of the fastest-growing companies in the software sector [44] Question: Trends in subscription revenue and expenses - Subscription revenue is expected to remain lumpy, with professional services revenue bouncing around 10% to 20% of total revenue, averaging 15% [46][47] - The company plans to continue investing in salesforce, R&D, and marketing efforts [50] Question: Competitive dynamics - The primary competition comes from IT organizations and CIOs attempting to build AI applications themselves, often leading to failures and eventual return to C3 AI [51][52][53] Question: Pilot growth and Q2 revenue guidance - The value of pilots remains consistent, with enterprise AI pilots averaging $0.5 million and generative AI pilots averaging $0.25 million [56] - Confidence in Q2 revenue growth is based on the company's track record of meeting or exceeding guidance for the past 15 quarters [58] Question: Partner efforts outside of Google Cloud - The company has strong partnerships with AWS and Microsoft Azure, with all hyperscalers benefiting from C3 AI's ability to quickly deploy applications and drive cloud resource consumption [62] Question: State and local government agreements - Most state and local government agreements begin as pilots, with the majority converting to production contracts [63][66]

Investor Supplemental FY25-Q1 September 4, 2024 Disclaimer 2 This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "anticipate," "believe," "continue," "estimate," "expect," "intend," "may," "will" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these words. Forward-looking statements in this press release include, but are not limited to, sta ...

Financial Performance - Total revenue for Q1 fiscal 2025 was $87.2 million, a 21% increase from $72.4 million in the same quarter last year[6]. - Subscription revenue accounted for $73.5 million, representing 84% of total revenue and a 20% increase from $61.4 million year-over-year[6]. - The company achieved a GAAP gross profit of $52.2 million, resulting in a 60% gross margin, while non-GAAP gross profit was $60.9 million with a 70% margin[6]. - Total revenue for the three months ended July 31, 2024, was $87,213, an increase of 20.5% compared to $72,362 in the same period of 2023[30]. - Subscription revenue rose to $73,456, up 19.7% from $61,352 year-over-year[30]. - Gross profit increased to $52,166, representing a gross margin of 60% compared to 56% in the prior year[38]. - Net loss for the quarter was $62,827, a slight improvement from a net loss of $64,358 in the same quarter of 2023[30]. - Non-GAAP net loss per share improved to $(0.05) from $(0.09) year-over-year[38]. - Total operating expenses increased to $124,752, up from $114,642 in the same period of 2023[30]. Cash Flow and Financial Position - The company has $762.5 million in cash, cash equivalents, and marketable securities[6]. - Positive free cash flow of $7.1 million was reported, with net cash provided by operating activities at $8.0 million[6]. - Cash and cash equivalents decreased to $133,820 from $206,442 at the end of the same quarter last year[35]. - Free cash flow for the quarter was $7,118, compared to a negative free cash flow of $(8,902) in the prior year[40]. - The company reported a net cash provided by operating activities of $8,042, an increase from $3,936 in the previous year[40]. - Accounts payable increased significantly to $31,615 from $11,316 year-over-year[33]. Business Growth and Agreements - C3 AI closed 71 agreements in Q1, marking a 122% increase year-over-year, including 52 pilot agreements, which increased by 117%[6]. - The company expanded its footprint in State and Local Government, closing 25 agreements across various states[6]. - C3 AI's Federal business represented over 30% of bookings for Q1, with new agreements with the U.S. Air Force, Navy, and Marine Corps[6]. Future Guidance and Demand - Guidance for Q2 fiscal 2025 projects total revenue between $88.6 million and $93.6 million, with full-year guidance of $370.0 million to $395.0 million[20]. - C3 Generative AI continues to see strong demand, with diverse applications including operator assistance and customer service[9].

Financial Performance - The company incurred net losses of approximately $279.7 million, $268.8 million, and $192.1 million for the fiscal years ended April 30, 2024, 2023, and 2022 respectively, resulting in an accumulated deficit of $1,089.9 million as of April 30, 2024[145]. - The company anticipates continued increases in operating expenses, which may negatively affect future results if revenue does not increase correspondingly[146]. - Revenue growth may be adversely impacted by factors such as reduced demand for C3 AI Software, increased competition, and the inability to accurately forecast demand[147]. - The average total subscription contract value is decreasing as the company expands its customer base beyond a small number of large customers[148]. - The company relies heavily on subscription renewals and expansions from existing customers, with no contractual obligation for customers to renew or upgrade[151]. - The company derives substantially all of its revenue from subscriptions to C3 AI Software and Center of Excellence support services, making market acceptance critical for continued success[154]. - Future revenue growth is dependent on the successful adoption of the company's C3 AI Software in a competitive market, which remains uncertain[175]. - A decline in new or renewed subscriptions may have a small immediate impact but will negatively affect future revenue[200]. Competition and Market Dynamics - The company faces intense competition from larger competitors with broader offerings and significant resources, which may impact its market share[157]. - Competitors may leverage acquisitions to enhance their offerings and accelerate technology adoption, posing additional challenges for the company[160]. - The company faces significant competition, which may require costly actions to maintain market position, potentially affecting financial results[161]. - Sales cycles for the company's C3 AI Software are long and unpredictable, particularly for large subscriptions, impacting revenue recognition and cash flow management[162]. - The effectiveness of marketing and sales operations is crucial for expanding the customer base and achieving broader market acceptance of C3 AI Software[182]. Customer Acquisition and Retention - The company intends to grow its customer base by introducing lower entry price point offerings, such as the no-code C3 AI Ex Machina[152]. - Strategic relationships with third parties, such as channel partners, are crucial for revenue growth, but maintaining these relationships involves significant risk and resource investment[169]. - Recruiting and training qualified sales representatives is resource-intensive, and failure to do so may hinder revenue growth[183]. - The company faces high customer acquisition costs due to significant investments in sales and marketing programs[183]. Regulatory and Compliance Risks - Compliance with evolving data privacy laws, such as the GDPR and CCPA, may increase legal risks and compliance costs for the company[206]. - The company may face significant fines for non-compliance with data protection laws, such as up to €20 million or 4% of annual global revenues under GDPR[207]. - The inability to implement valid compliance mechanisms for cross-border data transfers could lead to operational disruptions and increased regulatory scrutiny[209]. - New laws governing consumer health data privacy may impose stringent requirements and create private rights of action for violations[214]. - The company's use of AI/ML technologies may result in additional compliance costs and regulatory investigations, impacting business efficiency[213]. - The company faces significant challenges in complying with evolving data privacy and security obligations, which may require substantial resources and could limit the development of new applications and features[215]. Cybersecurity and Data Integrity - Cybersecurity threats, including ransomware and denial-of-service attacks, are increasing, posing risks to the company's operations and data integrity[218]. - The company’s C3 AI Software processes sensitive data, and any security incidents could lead to regulatory investigations, litigation, and reputational harm[216]. - Future business transactions, such as acquisitions, may expose the company to additional cybersecurity risks and vulnerabilities[219]. - The costs associated with responding to security breaches could be significant, potentially leading to unexpected interruptions and negative publicity[221]. - The company may not have adequate insurance coverage for security incidents, which could adversely affect its financial condition[225]. International Operations and Currency Risks - For the fiscal years ended April 30, 2024 and 2023, 6% and 8% of the company's revenue, respectively, were denominated in currencies other than U.S. dollars, exposing it to foreign currency exchange rate fluctuations[232]. - Approximately 5% of the company's sales for the fiscal year ended April 30, 2024, were denominated in euros, compared to 8% in 2023 and 13% in 2022, reflecting a decreasing trend in euro-denominated sales[468]. - A hypothetical 10% change in foreign currency exchange rates could have a material impact on the company's consolidated financial statements, highlighting exposure to foreign currency risk as international operations grow[468]. - The company is expanding its international operations, which may require significant management attention and resources[250]. Legal and Tax Liabilities - The company may face increased tax liabilities due to challenges from taxing authorities regarding its nexus in various jurisdictions[267]. - The application of indirect taxes to online transactions is complex and evolving, potentially impacting the company's business[268]. - The company has not historically collected VAT or GST on its sales, which may lead to future tax liabilities[266]. - Changes in tax laws or interpretations could adversely affect the company’s ability to utilize its NOLs and increase future tax liabilities[272]. Stock and Corporate Governance - The trading price of the Class A common stock has been volatile, influenced by various factors including market fluctuations and high volume retail trading[284]. - The dual class structure of common stock may limit the ability of stockholders to influence corporate matters, potentially affecting the market price of Class A common stock[290]. - The company is subject to potential securities class action litigation, which could divert management's attention and resources[288]. - The company’s exclusion from certain stock indices due to its dual class structure may limit investment from mutual funds and ETFs, adversely affecting trading price and volume[292]. Operational Challenges - The company has experienced disruptions and quality problems with its C3 AI Software and the public cloud infrastructure, which could adversely affect its business and financial condition[227]. - The company actively monitors its liquidity, and any inability to sustain sufficient liquidity could adversely affect its operations and financial position[240]. - The company may require additional capital in the future, and its ability to obtain financing will depend on various factors, including market conditions and operational performance[241]. - The company has limited experience in acquisitions, and any future acquisitions may not strengthen its competitive position or achieve desired goals[242].

Financial Data and Key Metrics Changes - C3.ai reported a 20% year-over-year revenue growth in Q4, reaching $86.6 million, exceeding guidance and analyst expectations [8][30] - Subscription revenue increased by 41% year-over-year to $79.9 million, accounting for 92% of total revenue [9][30] - Full-year revenue reached $310.6 million, a 16% increase from the previous year, with subscription revenue at $278.1 million, up 21% [9][30] - Non-GAAP gross profit was $60.9 million, resulting in a gross margin of 70% [9][31] - Free cash flow for the quarter was $18.8 million, with total cash, cash equivalents, and investments at $750.4 million [9][31] Business Line Data and Key Metrics Changes - The transition to pay-as-you-go consumption pricing has led to a significant increase in smaller transactions, with average total contract value (TCV) dropping from over $16 million in FY19 to $900,000 last quarter [10] - Professional services revenue was $6.7 million, representing 8% of total revenue, down from 21.5% in Q4 FY23, indicating a better mix towards subscription revenue [30] Market Data and Key Metrics Changes - C3.ai's bookings distribution for Q4 included approximately 50% from Federal, Defense, and Aerospace, 15% from Oil and Gas, and 11% from State Government [16] - The company signed 34 pilots in Q4, a 79% increase from the previous year, with a total of 172 pilots signed cumulatively [33] Company Strategy and Development Direction - C3.ai focuses exclusively on Enterprise AI applications, believing that applications will dominate the value stack as silicon and infrastructure become commoditized [11][13] - The company aims to establish a market leadership position in a potentially $1 trillion addressable software market, emphasizing long-term growth and investment [28][29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the accelerating revenue growth, projecting a 23% increase in revenue for FY25, with Q1 guidance set at $84 million to $89 million [29] - The company anticipates continued investment in growth, particularly in sales capacity and service to support increased demand [52] Other Important Information - C3.ai launched 30 Generative AI products in FY24, receiving nearly 50,000 inquiries from businesses, indicating strong market interest [25] - The company has established a robust partner network, closing 115 agreements in the past year, a 62% increase from the prior year [23] Q&A Session Summary Question: Can you talk about the improvements in Version 8 and its sustainability? - Management indicated that Version 8 was a four-year engineering effort, resulting in a significant architectural revamp, and while performance increases are expected, they may not be as substantial in the near future [35][36] Question: What is the outlook for the Federal, Defense, and Aerospace vertical? - Management views the Federal sector as a growth engine, with significant investments and agreements in place, particularly with the Air Force and Navy [38][40] Question: How are newly converted customers ramping consumption compared to previous cohorts? - Management noted that they have not disclosed specific consumption revenue separately but expect it to ramp up meaningfully in the future [48][49] Question: What drives lower margins during the pilot phase? - Management explained that they prioritize customer success over immediate profitability during pilots, which can lead to margin degradation [64][65]

C3 AI Announces Fiscal Fourth Quarter and Full Fiscal Year 2024 Financial Results Increasing Revenue Growth. Raising Guidance. Growth Accelerates for Fifth Consecutive Quarter, Record Federal Growth Subscription Revenue for the Fourth Quarter Increased 41% Year-Over-Year REDWOOD CITY, Calif. — May 29, 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 fourth quarter and full fiscal year ended April ...

C3.ai, Inc. (NYSE:AI) Q3 2024 Earnings Conference Call February 28, 2024 5:00 PM ET Company Participants Amit Berry - Investor Relations Thomas Siebel - Chairman and Chief Executive Officer Juho Parkkinen - Senior Vice President and Chief Financial Officer Hitesh Lath - Chief Accounting Officer Conference Call Participants Timothy Horan - Oppenheimer Sanjit Singh - Morgan Stanley Patrick Walravens - JMP Securities Kingsley Crane - Canaccord Genuity Operator Good day and thank you for standing by. Welcome to ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended January 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number: 001-39744 C3.ai, Inc. (Exact name of registrant as specified in its charter) (State or ot ...

C3 AI Announces Third Quarter Fiscal 2024 Financial Results Revenue Tops Guidance. Growth Accelerates. Revenue Target Raised REDWOOD CITY, Calif. — February 28, 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 third quarter ended January 31, 2024. "We had a great quarter. Total revenue of $78.4 million grew 18% year-over-year, exceeding our guidance range. Customer engagement grew 80% year-over-y ...

C3.ai, Inc. (NYSE:AI) Q2 2024 Results Conference Call December 6, 2023 5:00 PM ET Company Participants Amit Berry - IR Tom Siebel - Chairman and CEO Juho Parkkinen - CFO Conference Call Participants Timothy Horan - Oppenheimer Mike Cikos - Needham & Company Kingsley Crane - Canaccord Genuity Owen Hobbs - JMP Securities Operator Good day, and thank you for standing by. Welcome to the C3 AI Second Quarter Fiscal Year ‘24 Conference Call. At this time, all participants are in a listen-only mode. After the spea ...