C3.ai to report Q1 results Wednesday after market close

C3.ai Inc (NYSE: AI ) is scheduled to report its fiscal first-quarter results on Wednesday, September 2, after markets close.

While expectations are low after a year of negative revenue growth, this would be the first quarterly results under CEO Tom Siebel, which suggests "better sales execution," according to DA Davidson analyst Lucky Schreiner.

The C3.ai Analyst: Schreiner reaffirmed an Underperform rating and price target of $7.

The C3.ai Thesis: " We see upside to total revenue from professional services in the quarter and expect stable subscription revenue trends," Schreiner wrote in the note.

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C3.ai guided to net new revenue of around $1 million for the first quarter of fiscal 2027, versus revenue declines of $38.5 million in the same period last year, the analyst stated. “Headwinds from poor sales execution" marred the first quarter, he said.

Over the past couple of quarters, subscription revenue has "mostly stabilized," coming in flat on a sequential basis, Schreiner noted.

C3.ai has not generated demonstration license revenue during this period, the analyst added.

Management guided to total revenue of $52 million for the first quarter, which assumes that subscription and professional services revenue continue stabilizing, he added. "With Tom Siebel back at the helm, we see the potential for upside to sales execution and greater professional services activity," with C3.ai targeting larger customers "on more transformational AI applications," Schreiner wrote.

Outlook: Management’s initial fiscal 2027 guidance reflected 10% contraction in revenue, the analyst said.

C3.ai is likely to raise the lower end of its guidance range by the size of any beat, he further stated.

Schreiner added, however, that C3.ai is unlikely to become profitable in the near term.

AI Price Action: Shares of C3.ai had declined by 5.08% to $10.28 at the time of publication on Tuesday.

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