C3.ai Stock Takes a 30% Dive Following Disappointing Revenue Forecast
Artificial intelligence software company C3.ai faced a drastic 30% premarket stock decline after projecting significantly lower revenue for its fiscal first quarter. The company anticipates revenue to be between $70.2 million and $70.4 million, a figure that falls significantly short of the analyst estimates of $104.0 million as per FactSet.
Further exacerbating investor anxieties, C3.ai forecasts a non-GAAP loss ranging from $57.7 million to $57.9 million for the quarter. D.A. Davidson downgraded the stock from neutral to underperform, with analyst Lucky Schreiner expressing apprehension about the “increasing reliance on nonrecurring revenue.” The firm adjusted its price target downwards to $13 per share from $25, implying a potential downside of over 41%.
The company also unveiled a restructured sales and services organization, featuring new leadership across various regions. This setback occurs in spite of the broader AI sector’s robust performance, underscoring the hurdles that pure-play AI companies face in fulfilling investor expectations.
Source: CNBC