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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.
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