C3.ai Stock: Top Performance, Shares Rise Against Fiscal 2025 Revenue Forecast

C3.ai (AI) on Wednesday reported a narrower-than-expected fiscal fourth-quarter loss, while revenue beat estimates. Full-year fiscal 2025 outlook for C3.ai stock was above expectations. Following this news, AI shares surged due to heavy short interest in the company.

The manufacturer of software using artificial intelligence published its April results after the close of trading.

C3.ai’s best earnings estimates

In its fiscal fourth quarter, C3.ai said it lost 11 cents per share on an adjusted basis. That compared with a 13-cent loss a year earlier.

Revenue also increased 20% to $86.6 million. Wall Street analysts polled by FactSet predicted a loss of 30 cents per share on revenue of $84.4 million.

For the current quarter ending in July, the company projected revenue of $82.5 million at the midpoint of guidance. Additionally, analysts predicted revenues of $85.9 million.

For fiscal year 2025, C3.ai forecasts revenue of $382.5 million at the midpoint of guidance. Analysts predicted revenue growth of 19% to $367.7 million, up from 14.6%.

“The demand for enterprise AI is growing,” CEO Thomas M. Siebel said in the earnings release. He added: “Our federal revenues have increased over 100% in one year. The interest in our generative applications of AI is astonishing.”

The software maker helps companies build artificial intelligence-based applications and focuses on the energy, financial services and defense markets. However, it did not reveal the prices of the new generative artificial intelligence products.

On the stock exchange today, C3.ai shares rose over 6% to 25.38 in extended trading. Heading into 2024, the company’s shares are down approximately 16% ahead of C3.ai’s earnings report.

C3.ai stock: Very compact

In C3.ai’s earnings report, almost 30% of the company’s shares were shorted.

If investors believe that the stock price is falling, they can short sell the stock. They borrow shares and sell them with the intention of buying them back at a lower price. Hedge funds often do this, taking into account the risk and margin required.

In the short term, stocks are on the rise, performing better than expected. Short sellers must either put in more money to protect their position or exit their positions. This usually causes stock prices to rise.

MarketSurge users can go to the top left of the weekly chart and find short interest data for all stocks in the IBD database.

Waiting for commercial implementation of AI

C3.ai told analysts that it expects revenue growth to accelerate again as more AI pilot projects enter commercial production.

Meanwhile, C3.ai stock is one of many AI names worth watching.

C3.ai has retreated from its goal of achieving adjusted profitability amid rising investment in artificial intelligence. Additionally, C3.ai is shifting to consumer priced services, which puts pressure on profit margins in the short term.

Additionally, C3.ai stock received a Relative Strength Rating of 12 out of a best possible 99 on its earnings report, according to IBD Stock Checkup.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.

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