C3.ai shares tumble as guidance fails to impress investors

Published 26/02/2025, 22:28
C3.ai shares tumble as guidance fails to impress investors

REDWOOD CITY, Calif. - C3.ai, Inc. (NYSE:AI) shares fell 10.4% in after-hours trading despite the enterprise AI software company reporting better-than-expected fiscal third quarter results, as its guidance failed to excite investors.

The company posted adjusted earnings per share of -$0.12 for the quarter ended January 31, 2025, beating analyst estimates of -$0.24. Revenue came in at $98.8 million, slightly above the consensus of $98.01 million and up 26% YoY.

However, C3.ai’s outlook for the fourth quarter and full fiscal year 2025 was largely in line with Wall Street expectations. The company forecast Q4 revenue between $103.6 million and $113.6 million, compared to analyst estimates of $108.6 million. For the full year, C3.ai expects revenue of $383.9 million to $393.9 million, versus the $388.3 million consensus.

"In the third quarter, C3 AI achieved significant milestones — expanding our global distribution network, advancing our leadership in agentic and generative AI, and delivering total revenue reaching $98.8 million, up 26% year-over-year," said Thomas M. Siebel, Chairman and CEO of C3 AI.

The company highlighted its expanded partnerships with Microsoft (NASDAQ:MSFT), AWS, and McKinsey QuantumBlack as key drivers of growth. C3.ai closed 66 agreements in the quarter, including 50 pilots, representing a 72% YoY increase.

Subscription revenue, which made up 87% of total revenue, grew 22% YoY to $85.7 million. The company ended the quarter with $724.3 million in cash and marketable securities.

Despite the positive results, the stock’s sharp decline suggests investors may have been looking for more aggressive growth projections from the AI software provider.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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