C3.ai Surprises with Strong Earnings But Analysts Adjust Targets
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C3.ai's Impressive First Quarter Earnings
C3.ai Inc (NYSE: AI) recently celebrated a prosperous start to their fiscal year, showcasing remarkable earnings and sales figures for the first quarter. The company recorded an impressive revenue of $87.2 million, marking a 21% increase compared to the same period last year. This revenue outpaced Wall Street's expectations, which projected $86.9 million.
Subscription Revenue Growth
Subscription revenue played a significant role in C3.ai's overall performance, totaling $73.5 million for the quarter, an increase of 20% year-over-year. Notably, subscription revenue constituted 84% of the company’s total earnings during this period.
Quarterly Losses and Market Reactions
Despite reporting a loss of 5 cents per share, C3.ai exceeded market predictions, where a higher deficit of 13 cents per share was anticipated. CEO Thomas Siebel expressed confidence in the company’s trajectory, citing robust demand for their Enterprise AI solutions and celebrating the company’s sixth consecutive quarter of accelerating revenue growth.
Future Guidance and Analyst Adjustments
Looking ahead, C3.ai has guided second-quarter revenue estimates between $88.6 million and $93.6 million. For the entire fiscal year, projections are set between $370 million and $395 million. Following these earnings results, analysts shifted their price targets for C3.ai. Piper Sandler analyst Arvind Ramnani maintained a Neutral rating but lowered the price target from $29 to $24, while Morgan Stanley’s Sanjit Singh also adjusted their target down to $21 from $23, maintaining an Underweight rating.
What Analysts Are Saying About C3.ai
Needham’s analyst Mike Cikos reiterated a Hold rating on C3.ai, further emphasizing the mixed sentiments surrounding the stock in light of the results. These revisions reflect a cautious optimism about C3.ai's future performance and the evolving landscape of AI technologies in the market.
Frequently Asked Questions
What were C3.ai's Q1 earnings results?
C3.ai reported Q1 revenue of $87.2 million, exceeding expectations and representing a 21% increase year-over-year.
How did C3.ai's subscription revenue perform?
Subscription revenue increased by 20%, totaling $73.5 million, which made up 84% of the company's overall revenue for the quarter.
What is C3.ai's future revenue guidance?
The company projects second-quarter revenue between $88.6 million and $93.6 million, and full fiscal-year revenue to be between $370 million and $395 million.
Have analysts changed their outlook for C3.ai?
Yes, analysts have adjusted their price targets for C3.ai following the earnings announcement; some lowered their expectations while others maintained their ratings.
What is C3.ai's stock ticker?
C3.ai trades under the ticker symbol AI on the NYSE.
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