C3.ai rises after strong first-quarter results and analyst commentary
C3.ai shares rose after the company reported fiscal first-quarter results that included revenue of $52.4 million, cost reductions and positive free cash flow. Analysts flagged progress but said second-quarter revenue guidance came in below consensus.
Shares of C3.ai Inc (NYSE: AI ) are up on Thursday, after the company on Wednesday reported strong fiscal first-quarter results.
Here are some key analyst takeaways: DA Davidson analyst Lucky Schreiner reaffirmed an Underperform rating and price target of $7.
Canaccord Genuity analyst Kingsley Crane reiterated a Hold rating and price target of $10.
Needham analyst Mike Cikos maintained a Buy rating on the stock.
Check out other analyst stock ratings.
DA Davidson: C3.ai reported revenue in line with consensus, with stable subscription revenue, Schreiner said in a note.
Revenue contracted by 25% year-on-year, compared to a 53% decline in the previous quarter, he added.
Management indicated improved sales execution during the quarter and demand strength within the company’s federal customer base, the analyst stated.
The company’s second-quarter revenue guidance is $53 million at the midpoint, coming slightly below consensus expectations of $56 million and implying a revenue decline of 29% year-on-year, he noted.
Canaccord Genuity: C3.ai’s fiscal first-quarter results indicate "a step in the right direction," as it showed management’s "disciplined restructuring," Crane said.
Non-GAAP expenses came down almost $40 million year-on-year and around $17 million sequentially, he added.
Non-GAAP operating loss of $36.2 million was better than the guidance midpoint, while free cash flow turned positive at $2.1 million, the analyst stated.
The company’s newer C3 Code product seems to be "gaining real traction among early users" and could be "a driver for revenue in the medium term," he further wrote.
Needham: C3.ai’s revenue declined 25% year-on-year to $52.4 million, coming within the guided range, Cikos said.
Revenue outlook for the fiscal second quarter was $51-$55 million, below the consensus forecast of $56.6 million, he added.
C3.ai exhibited cost discipline and achieved around $135 million in annualized cost savings across the business, including a headcount reduction of around 40%, and management intends to reinvest a part of these savings, the analyst stated.
Management’s fiscal 2027 guidance implies a non-GAAP operating loss of $123-$155 million versus the previous forecast of $128-$160 million, he further noted.
AI Price Action: Shares of C3.ai had risen by 2.71% to $10.80 at the time of publication on Thursday.
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