C3.ai(US:AI)2025-05-28 22:02Financial Data and Key Metrics Changes - Total revenue for Q4 reached $108.7 million, reflecting a 26% increase compared to $86.6 million in the same quarter of the prior year [41] - Subscription revenue for the quarter was $87.3 million, up 9% from $79.9 million a year ago [41] - For the full fiscal year 2025, total revenue was $389.1 million, a 25% increase compared to $310.6 million in fiscal 2024 [42] - Non-GAAP gross profit for Q4 was $75.2 million, equating to a gross margin of approximately 69% [41] - Non-GAAP operating loss was $31.2 million, which was within the guidance range of $30 million to $40 million [41] - Free cash flow for Q4 was $10.3 million, with cash, cash equivalents, and investments totaling $742.7 million at the end of the quarter [41][68] Business Line Data and Key Metrics Changes - Revenue from the sale of software licenses that are demonstration versions of C3AI applications was $33.8 million during the quarter [64] - Professional services revenue was $21.4 million, with prioritized engineering services accounting for $17 million [65] - Non-Baker Hughes revenue grew by 37% year over year during the quarter and by 40% during the year [65] Market Data and Key Metrics Changes - Non-oil and gas revenue increased by 48% year over year, reflecting successful expansion into 19 different industries [44] - Revenue in state and local government grew over 100% in fiscal 2025, with 71 agreements closed across organizations in 24 states [45] - The life sciences and healthcare sector is emerging as a strength, with traction from customers like GSK and Quest Diagnostics [46] Company Strategy and Development Direction - The company has focused on building a robust partner ecosystem, with 73% of agreements delivered in collaboration with partners [48] - Strategic partnerships with Microsoft, AWS, and Google Cloud are pivotal for expanding market reach and enhancing execution [49] - The renewed partnership with Baker Hughes is expected to drive innovation and opportunity in the energy sector [44] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory, expecting revenue growth to continue exceeding expense growth [71] - The company anticipates crossing into non-GAAP profitability during the second half of fiscal 2027 and expects to be free cash flow positive in Q4 of fiscal 2026 [71] - The enterprise AI market is described as a vast and growing opportunity, with a focus on delivering secure, scalable, and production-grade solutions [59] Other Important Information - The company has delivered over 130 applications to date, positioning itself uniquely in the AI landscape [60] - The C3 generative AI revenue grew more than 100% in FY 2025, with significant deployments across various industries [56] - The company holds a patent for Agentic AI, which is expected to capitalize on a rapidly growing market [29] Q&A Session Summary Question: How does the company activate Azure sales reps to deliver C3AI? - The company is focusing on engaging Azure sales reps through joint sales calls and providing them with the necessary tools to demonstrate solutions effectively [73][75] Question: Can you provide details on the economics of the new Baker Hughes deal? - Specifics are under NDA, but the partnership has broadened significantly, continuing to provide solutions and enabling Baker Hughes to develop derivative works [82] Question: How did the company construct its revenue guidance for FY26? - The guidance reflects awareness of geopolitical risks and the need for stability, with expectations that revenue growth will continue to exceed expense growth [85]