Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - Needham maintained its Hold rating on C3.ai (NYSE:AI), which currently trades near its InvestingPro Fair Value, after the company released preliminary first-quarter results showing significant revenue shortfalls. The stock has declined over 30% in the past six months, reflecting ongoing challenges.
C3.ai reported preliminary first-quarter revenue between $70.2 million and $70.4 million, missing the midpoint of its guidance by 33% and declining 19% year-over-year, according to Needham analyst Mike Cikos. The company’s overall financial health score is rated as "Weak" by InvestingPro, which offers 8 additional key insights about the company’s performance.
The revenue shortfall more than doubled C3.ai’s projected non-GAAP operating loss to $57.8 million, representing an operating margin of -82.2% at the midpoint of the preliminary results.
Management attributed the poor performance to a disruptive sales restructuring with new leadership, which has been completed, and health issues affecting Chairman and CEO Tom Siebel that limited his participation in the sales process.
Siebel noted in the press release that his health has improved dramatically, and the company is scheduled to report its audited financial results on September 3.
In other recent news, C3.ai announced its first quarter fiscal 2026 results, which led Wolfe Research to reiterate its Underperform rating with a $15.00 price target. DA Davidson downgraded C3.ai from Neutral to Underperform, significantly reducing its price target to $13.00 from $25.00, citing preliminary results that fell significantly below guidance. Additionally, C3.ai’s CEO, Thomas M. Siebel, will step down due to health issues, prompting the company to begin a search for his successor. This decision comes after Siebel was diagnosed with an autoimmune disease that has caused significant visual impairment. The search for a new CEO will be conducted by an international search firm, reporting to a committee of C3.ai board members and management. Despite these challenges, C3.ai announced a strategic partnership with Huntington Ingalls (NYSE:HII) Industries to integrate AI solutions in shipbuilding operations. This partnership aims to enhance production efficiency and support the U.S. Navy’s fleet readiness. These developments reflect significant changes and strategic initiatives at C3.ai.
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