| Highlights |
|---|
| C3.ai revises its profitability forecast, leading to a drop in share value. |
| The AI software company opts for increased investment in generative AI solutions. |
| CEO Thomas Siebel expresses optimism about AI’s growth potential. |
| In the fiscal first quarter of 2024, revenue reached $72.4 million, surpassing Wall Street’s expected $71.6 million. |
| The adjusted loss per share for this period was $0.09, narrower than the projected $0.17 by analysts. |
| Management has raised its anticipated adjusted operating loss for fiscal 2024, attributing it to increased expenditure on marketing and related initiatives aimed at promoting its generative AI products. |
Shares of C3.ai (AI), an enterprise artificial intelligence (AI) application software firm, faced a significant dip of over 12% following the company’s announcement that it won’t achieve profitability as quickly as initially expected.
This adjustment is attributed to the company’s decision to amplify its investment in the rapidly expanding AI sector.
While C3.ai reported a loss of $0.09 for the first quarter of fiscal 2024—lower than the previous year but surpassing expectations—it also revealed a revenue increase of 10.8%, totaling $72.36 million, which exceeded estimates.
However, the gross margin of 69% fell short of projections.
The company clarified that, upon careful evaluation, it opted to channel investments into lead generation, branding, market visibility, and ensuring customer success in its generative AI solutions.
Consequently, C3.ai no longer anticipates achieving non-GAAP profitability by the end of the fiscal year, as previously indicated.
Founder and CEO Thomas Siebel expressed the belief that the AI market’s scale and growth rate had exceeded anyone’s expectations. He highlighted the company’s 14-year preparation for this remarkable opportunity and stated, “we will seize it.”
While C3.ai shares experienced a decline, they have still achieved an impressive year-to-date increase of 146%.
(Source: Investopedia)
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