C3ai (AI) AI Stock Analysis

• Market Cap: $2.98B
• Dividend Yield: N/A
• Average Volume (3M): 3.51M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.30
• Revenue Growth: 23.79%
• EPS Growth: 4.10%
• Country: US
• Employees: 891
• Sector: Technology
• Sector Strength: 66
• Industry: Information Technology Services
• EPS (TTM): -2.23
• Shares Outstanding: 129,238,720
• 10 Day Avg. Volume: 3,122,851
• 30 Day Avg. Volume: 3,507,342
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 18.86
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $28.50
• Price Target Upside: 26.78% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 11

C3ai's overall stock score reflects strong revenue growth and strategic advancements in AI, supported by solid partnerships. However, challenges in profitability, negative cash flow, and bearish technical indicators weigh down the score. The company needs to address financial inefficiencies to improve its market position.

Positive Factors

Financial Performance

C3.ai delivered solid F3Q25 results, with continued top-line momentum and better-than-expected profit performance.

Partnerships

Keystone partnerships with Azure, AWS, and McKinsey — and their ability to drive customer engagement — remain major drivers of business performance and stock price action.

Negative Factors

Profitability

Profitability remains elusive, with lowered FY25 profit guidance implying negative margins.

Revenue Streams

29% of revenue coming from demonstration licenses raises questions about the long-term value of these revenue streams going forward.

C3ai Business Overview & Revenue Model

Company Description

C3.ai, Inc. operates as an enterprise artificial intelligence (AI) software company in North America, Europe, the Middle East, Africa, the Asia Pacific, and internationally. It provides C3 AI application platform, an application development and runtime environment that enables customers to design, develop, and deploy enterprise AI applications; C3 AI Ex Machina to for analysis-ready data; C3 AI CRM, an industry specific customer relationship management solution; and C3 AI Data Vision that visualizes, understands, and leverages the relationships between data entities. It also offers C3 AI applications, including C3 AI Inventory Optimization, a solution to optimize raw material, in-process, and finished goods inventory levels; C3 AI Supply Network Risk, which provides visibility into risks of disruption throughout the supply chain operations; C3 AI Customer Churn Management, which enables account executives and relationship managers to monitor customer satisfaction, as well as to prevent customer churn with AI-based and human-interpretable predictions and warning; C3 AI Production Schedule Optimization, a solution for scheduling production; C3 AI Predictive Maintenance, which provides insight into asset risk to maintenance planners and equipment operators; C3 AI Fraud Detection solution that identify revenue leakage or maintenance and safety issues; and C3 AI Energy Management solution. In addition, it offers integrated turnkey enterprise AI applications for oil and gas, chemicals, utilities, manufacturing, financial services, defense, intelligence, aerospace, healthcare, and telecommunications market segments. It has strategic partnerships with Baker Hughes in the areas of oil and gas market; FIS in the areas of financial services market; Raytheon; and AWS, Intel, Google, and Microsoft. The company was formerly known as C3 IoT, Inc. and changed its name to C3.ai, Inc. in June 2019. C3.ai, Inc. was incorporated in 2009 and is headquartered in Redwood City, California.

How the Company Makes Money

C3.ai generates revenue primarily through the sale of its software products and services. The company employs a subscription-based revenue model, where customers pay recurring fees to access the C3 AI Suite and other AI applications. These subscriptions often involve multi-year contracts, providing a steady revenue stream. Additionally, C3.ai offers professional services such as implementation, integration, and support to help clients effectively deploy and utilize its AI solutions. Strategic partnerships with major technology companies and industry leaders also contribute to its earnings by expanding market reach and fostering collaborative innovation in AI applications.

C3ai Financial Statement Overview

Summary

C3.ai shows robust revenue growth but struggles with profitability, as evidenced by negative net profit and EBIT margins. The strong gross profit margin is countered by operational inefficiencies and negative cash flow, posing liquidity risks. A solid balance sheet with no debt offers stability, but negative return on equity reflects ongoing challenges.

Income Statement

C3ai has shown consistent revenue growth with a TTM revenue of $366.9M, representing a healthy increase from previous years. However, the company struggles with profitability, evident from a negative net profit margin and EBIT margin. The gross profit margin remains strong at approximately 60%, but operating losses due to high expenses are a concern.

Balance Sheet

The balance sheet of C3ai is relatively strong, with substantial stockholders' equity of $860.2M and no total debt as of the latest TTM. The equity ratio is robust, indicating a stable financial structure. However, the negative net income impacts the return on equity, which remains negative, underlining operational inefficiencies.

Cash Flow

C3ai's cash flow position is concerning, with negative free cash flow and operating cash flow over the recent periods. Although there is a slight improvement in free cash flow when comparing the latest TTM to the previous year, the company still spends more cash than it generates from operations, posing liquidity risks.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
310.58M	266.80M	252.76M	183.22M	156.67M
	Gross Profit
178.56M	180.46M	189.05M	138.70M	117.88M
	EBIT
-318.34M	-290.49M	-196.12M	-60.26M	-71.50M
	EBITDA
-305.62M	-285.50M	-190.93M	-55.96M	-70.19M
	Net Income Common Stockholders
-279.70M	-268.84M	-192.06M	-55.70M	-69.38M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
750.37M	730.98M	960.16M	1.09B	244.98M
	Total Assets
1.04B	1.10B	1.17B	1.20B	305.11M
	Total Debt
3.23M	2.34M	3.61M	5.63M	5.65M
	Net Debt
-163.92M	-282.49M	-335.92M	-109.73M	-27.46M
	Total Liabilities
164.87M	173.36M	181.41M	135.30M	487.81M
	Stockholders Equity
873.35M	929.66M	989.48M	1.06B	-182.70M
Cash Flow		Free Cash Flow
-107.70M	-187.21M	-90.75M	-39.18M	-64.16M
	Operating Cash Flow
-62.36M	-115.69M	-86.46M	-37.55M	-61.28M
	Investing Cash Flow
-66.61M	59.95M	317.01M	-767.15M	-124.07M
	Financing Cash Flow
11.29M	621.00K	5.71M	887.36M	119.85M

C3ai Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 22.48
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AI, the sentiment is Neutral. The current price of 22.48 is above the 20-day moving average (MA) of 20.63, above the 50-day MA of 21.92, and below the 200-day MA of 27.34, indicating a neutral trend. The MACD of 0.02 indicates Negative momentum. The RSI at 55.78 is Neutral, neither overbought nor oversold. The STOCH value of 81.04 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AI.

C3ai Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INFY	80 Outperform	$68.09B	21.14	29.00%	2.32%	3.85%	-0.38%
G	78 Outperform	$8.69B	17.46	22.15%	1.26%	6.46%	-16.94%
ACN	77 Outperform	$181.42B	23.91	27.26%	1.88%	4.10%	9.78%
CTSH	76 Outperform	$38.30B	17.24	16.61%	1.56%	4.09%	14.05%
EPAM	73 Outperform	$9.08B	20.45	12.80%	―	0.80%	10.05%
Sector *	60 Neutral	$10.95B	10.48	-7.05%	2.99%	7.56%	-12.20%
AI	53 Neutral	$2.98B	―	-32.07%	―	23.79%	4.10%

C3ai Corporate Events

C3ai Appoints Retired General Hyten to Board of Directors

C3.ai, Inc. has appointed General John E. Hyten, a retired U.S. military leader with a distinguished 40-year career, to its board of directors. His expertise in AI and defense will play a crucial role in guiding the enterprise AI software company’s strategic direction, especially in federal, defense, and intelligence applications. General Hyten will receive stock options but no cash compensation for his board service, underscoring his commitment to the company’s mission of delivering advanced AI solutions to enhance national security and economic prosperity.