Home > Industry Information > AI Bubble Breaks, Another AI Software Company C3.AI Plummeted 18%
According to Tianyancha, as the U.S. technology giants tighten their expenditures under the uncertainty of the US economy,AI software service provider $ C3.AI (AI.US) $ announced that the quarterly fiscal quarterly fiscal quarter financial report that was not as expected in fiscal year in fiscal year was not as expected. Affected by this, the company's stock price plummeted after the US stock market on Wednesday.
As of press time,C3.AI fell more than 16%at night.
Stretch16%, C3.AI's AI story can't tell?
Faced with high interest rates and unstable businesses, the company's cautious attitude towards new software investment has affected the rightDemand of C3.AI products.The company's subscription revenue in the first quarter is US $ 7.5 million, and analysts are expected to be $ 79.1 million.
The plunge of C3.AI's stock price highlights the unstable balance between technology companies must maintain unstable between innovation and market stability.Although the company's total revenue is slightly higher than expected, the significant decline in subscription revenue reflects people's general concerns about corporate expenditure in corporate expenditures in the period of uncertainty.
Looking forward to the future, although there are US Department of Defense and Dolcebanna(DOLCE & Amp; Gabbana) and other well -known customers, but C3.AI's guidance is still lower than analyst expectations.The company's revenue in fiscal year is expected to remain between 370 million and 395 million US dollars, and the median value is lower than the analyst's expected US $ 383.9 million.The revenue of the second quarter is expected to be between 88.6 million and $ 93.6 million, and the median value is consistent with the expectations of $ 91.1 million.
The company's situation emphasizes that the company has re -adjusted the broad trend of technology budgets under the situation of uncertainty.The company's solution uses generation artificial intelligence technology to meet the needs of different industries such as manufacturing, defense, aerospace and pharmaceuticals.But the expectations of this fiscal year and next quarter show their cautious optimism.As companies adapt to the turbulent economic environment, the toughness of the technology industry will be tested.
However, the company's total revenue reached87.2 million US dollars, an increase of 20.5%year -on -year, exceeding the expectations of analysts $ 86.94 million. After adjustment, the loss per share loss of $ 0.05, and the market expects to lose $ 0.13 per share.
Thanks to corporate customers' interest in artificial intelligence,C3.AI has been launching products with generated artificial intelligence.The company headquartered in California said that in the quarter of July 31, it completed 17 generation artificial intelligence pilot projects with large companies and government agencies.
THOMAS M. Siebel, chairman and CEO of C3.AI, said: Our fiscal year is stable, and the demand for artificial intelligence in enterprises has continued to increase, which has promoted our accelerated growth in revenue for the sixth consecutive quarter.C3.AI is the earliest corporate artificial intelligence company.We are unswervingly committed to solving the most challenging problems in the company, which makes us the most satisfied company in the industry.
Seeking Alpha analyst Michael Wiggins said I was worried that the stock price of C3.AI had merged high expectations, so the room for rising was small, especially when the company continued to burn money.
Although it has been promoted around artificial intelligence, I believe that the transition to a consumer -based pricing model may bring predictive challenges in income.
Rely onIn the valuation of 7 times and long -term sales, I have seen more attractive opportunities in other fields in the field of SaaS, and can provide better growth prospects and profitability.
I doubtCan C3.AI provide a strong profitable performance required for the reasonable current price, which makes it an adventure bet in the upcoming revenue report.
Although there are obvious positive aspects, such as a good positioning company, a convincing narrative, and a debt -free balance sheet, I still think that investors' expectations are too high.
All in all, I think paymentThe long -term sales of C3.AI 7 times will cause investors to have no safe margin.In short, investors who pay $ 24 per share will eventually regard the stock as a high price worthy of pursuing.
I believe it takes several years for its profit road.Therefore, there are reason to keep the stock neutral.
At that time, this was a very difficult reverse decision.I think investors should not further chase artificial intelligence.As usual, the stock has been lower.I believe it will not be much better in the recent prospects.It's best to avoid this one per share$ 24 stocks.
Why chooseC3.AI?Why is it now?
C3.AI is a software company that provides artificial intelligence applications for enterprises.These applications aim to help large organizations use artificial intelligence to improve their operations, such as predictive maintenance and supply chain optimization.
C3.AI focuses on ready -made applications, not underlying infrastructure or artificial intelligence models.This makes it easier for the company to use artificial intelligence without having to build everything from scratch.
In addition, one of the key drivers for growth is itsC3 generates an artificial intelligence kit, which arouses great interest in various industries.For example, the number of consultations in the previous quarter was close to 50,000, and it is expected to consult more than 90,000 times this quarter. The product will become the main growth engine of C3.AI.
As more and more companies seek scalable artificial intelligence applications,The products of C3.AI in this field are expected to laid a solid foundation and runway for its strong growth in fiscal 2025.
The income growth rate should increase, butC3.AI strives to allow investors to regard it as a reasonable and pure growth story.Long -term growth stories can achieve more than 30% income growth rate.However, the problem here is that the narrative of artificial intelligence is over.
Investors' eyes are no longerTell me the story, but the story showed me.In short, investors hope to see the significant growth of their income lines and the guidelines that will be adjusted every quarter every quarter.After all, this is how the growth story starts.
However, considering this, please pay attentionC3.AI's income scale, and the entire artificial intelligence boom has occurred in the past year and a half:
The income of C3.AI is often at a lower number of digits. Except for the first quarter, C3.AI actually did not meet the expectations of analysts. See it above.In short, I think the expectations of this stock are too high for the fundamentals it provided.Considering this paper, let us discuss its valuation and compare it with other high -growth companies.
whenWhen C3.AI reported on Wednesday, when its financial report in the first quarter of 2025, its total cash and securities bars will be about $ 735 million.Given that there is no debt on C3.AI's balance sheet, this means that about 25% of its market value consists of cash.This undoubtedly retains the company's inherent value and prevents its stock price from falling sharply.
That being said, consider the expectations of investors.Investors are willing to doC3.AI pays about 7 times long -term sales. In the best situation in the next few years, the business will consume about $ 80 million in free cash flow and bring about 17% of non -GAAP operating profits to investors for investors.Rate.
Under the same sales multiple, investors can set their sights onOther areas of SaaS.For example, under the same valuation, my personal favorite is Sentinelone (s).Nevertheless, I will soon point out that I believe Sentinelone is likely to achieve a free cash flow of $ 100 million in the next 12 months.For a long period of time, the situation of C3.AI cannot be said.
Another comparison can beMongoDB (MDB); however, even so, the business has achieved great profit.
Therefore, it is difficult for me to imagine that when people expect this profit result, how can investors be surprised?They will not be surprised, and they are likely not.
Despite income growth,C3.AI is facing major challenges when transitioning to consumer pricing model, which leads to a decline in the average contract value, which will affect its predictability of its long -term revenue growth rate.
I have proposed this argument many times for many years.Companies that turn to consumer models are placing themselves on the opposite of customers.
It's likeNetflix (NFLX) is compared with the business model of paying for the business model.In the long run, what is better?Is a promotion viewIs it a way to pay for customers to pay a lot of money because of your service?
Considering these factors, I think investors areIt is wise to avoid C3.AI when C3.AI announces the profit results.Although the company has a convincing narrative and a stable balance sheet, there is almost no room for making mistakes.Although the stock's income is not high and facing continuous challenges in the transition of consumption -based pricing models, based on 7 times the long -term sales calculation, the price of the stock has been perfect.
in short,C3.AI's AI may only represent the expectations of expansion.
It is still at a high position after the plungeC3.AI, should you copy the bottom?
according toC3.AI, Inc. (NYSE: AI) on September 4, 2024's financial report conference call.The company has achieved income growth accelerated for the sixth consecutive quarter.The total revenue of this quarter was US $ 87.22 million, of which the subscription revenue was US $ 73.52 million, a year -on -year increase of 20%.Non -GAAP gross profit is US $ 60.92 million and gross profit margin is 70%.
However, the current company'sGAAP business loss is $ 72.62 million, instead of GAAP business loss of $ 16.62 million, far lower than the previously expected losses of 22 million to 30 million US dollars.Non -GAAP net loss is $ 0.05 per share.The cash flow generated by operating activities is 8 million US dollars, and the free cash flow is 7.11 million US dollars, all exceeding market expectations.As of the end of the quarter, the company's cash, cash equivalent and total investment exceeded US $ 760 million.
C3.AI signed 71 agreements this quarter, including 72 new pilots, an increase of 117%year -on -year.The company signed new customers with GSK, Eletrobras, Valero, Swift, Smithrx, Sanofi, American Intelligence, US Department of Defense, Dolce & AMP; Gabbana, INGERSOLL RAND and other new customers.Business, signed with Municipal, county, county, and state agencies in Texas, California, New Jersey, Georgia, Washington, Connecticut, Virginia, Rhode Island, Maine, New Mexico and Florida.Over25 agreements.
The C3.AI solution improves efficiency while maintaining the highest standards of accuracy, transparency and security.These solutions have brought significant cost savings to customers and improved public services and customer experience.
existIn the second quarter of fiscal year in fiscal 2025, C3.AI is expected to expand its sales capabilities, especially in North America, Europe and public sector.The company's partner network continues to have opportunities and start new transaction processes.In the first quarter, the company cooperated closely with partners and signed 51 new agreements.The reservation supported by partners increased by 94%year -on -year, and the level of activities of partners such as AWS, Booz Allen, Google Cloud and Microsoft continued to increase significantly.
In terms of C3.AI's products and generating AI updates, the company provides pre -constructed AI applications. These applications can be quickly deployed and run on the C3.AI platform. It has high -level data fusion and governance and scalable AI//ML operating ability.These applications are not in isolation, but are designed and constructed as collaborative work. Each new application can be deployed faster than the previous one.
C3.AILaunchC3 generates AI applications, which can be used as an independent solution or deployed with other C3.AI applications.This quarter,The company deployed in a large manufacturerC3 generates AI for industrial asset inspection.These applications can process structured sensor data, databases, non -structured documents, images, embedded tables, and use any large language model (LLM) available in any available in the market.
The founder and CEO of C3.AI, Thomas Siebel, emphasized that the company is a primitive company of the enterprise AI. Since January 2009, it has been committed to developing a software platform and enterprise applications so that organizations can use future computing platforms.Today, C3.AI has deployed more than 90 enterprise applications in Europe, Asia, South America, North America, and global governments, covering energy, government, national defense, manufacturing, financial services, comprehensive agricultural enterprises, pharmaceuticals and other industries.Value chain.
Siebel also pointed out that C3.AI's customer satisfaction is very high, thanks to the company's profound understanding of customer needs, software technology and deep professional knowledge in enterprise AI.In the current hustle and bustle of the AI market,C3.AI realizes the highest customer value realization level in the enterprise software world.The company is expected to achieve positive cash flow in the fourth quarter of fiscal year and the entire fiscal year, and it is expected to achieve non -GAAP profit.
SoIn the second quarter of fiscal year in fiscal 2025, C3.AI's revenue guidance was $ 88.6 million to $ 93.6 million.For the entire fiscal year, the company maintained previous guidance, that is, US $ 370 million to US $ 395 million, which means that the year -on -year growth rate is 19%to 27%.For non -GAAP business losses, the guidance in the second quarter was US $ 26.7 million to $ 34.7 million, and the guidance of the entire fiscal year was 95 million US dollars to $ 125 million.From this perspective, it is probably not a good time before the increase in revenue volume.
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