Recommendation: Speculative Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Potential Upside* |
|---|---|---|---|---|---|---|---|
| 12 May, 25 | AI | Speculative Buy | USD 23.37 | USD 25.0 | USD 26.0 | 16 days | 11.3% |
*Potential Upside (%) indicates the expected percentage increase from the Entry Price to the Target 2 Price.
Data Powered by EOD Historical Data (“EODHD”).
C3.ai, Inc. operates as an enterprise artificial intelligence (AI) software company in North America, Europe, the Middle East, Africa, the Asia Pacific, and internationally. The company provides C3 AI platform, an application development and runtime environment that enables customers to design, develop, and deploy enterprise AI applications; C3 AI CRM Suite, an industry specific customer relationship management solution; and C3 Generative AI that enables to locate, retrieve, present information, disparate data stores, applications, and enterprise information systems. It also offers C3 AI applications, including C3 AI Inventory Optimization that analyzes variability across demand, supply, and production and optimizes inventory levels; C3 AI Supply Network Risk, which identifies emerging inbound and outbound risks across the network; C3 AI Sustainability Suite, which helps to decrease greenhouse gas emission; C3 AI Production Schedule Optimization, a solution for scheduling production; C3 AI Financial Services Suite, which helps to minimize compliance risks; and C3 AI Energy Management solution. In addition, it offers enterprise AI applications for oil and gas, chemicals, utilities, manufacturing, financial services, government, defense, intelligence, aerospace, retail, transportation, healthcare, and telecommunications market. It has strategic partnerships with Google Cloud, AWS, Microsoft Azure, Baker Hughes, Booz Allen, Raytheon, FIS, and others. The company was formerly known as C3 IoT, Inc. and changed its name to C3.ai, Inc. in June 2019. C3.ai, Inc. was incorporated in 2009 and is headquartered in Redwood City, California.
Partner-Driven Growth: The company closed 47 agreements through its partner network, representing a 74% year-over-year increase, demonstrating effective go-to-market leverage through strategic alliances
Revenue Growth: Total revenue increased by 26% year-over-year, reaching $98.8 million in Q3 FY2025, compared to $78.4 million in Q3 FY2024
High Operational Losses Guidance: For full-year FY2025, the company projects a non-GAAP operating loss between $(87.0) million and $(97.0) million, suggesting sustained high spending and limited short-term margin leverage
Continued Losses: The company reported a GAAP net loss per share of $(0.62) and a non-GAAP net loss per share of $(0.12), indicating ongoing challenges in reaching profitability
C3 AI's reliance on a high-volume pilot-based sales model, coupled with persistent operating losses and a competitive enterprise AI landscape, poses a significant risk to achieving sustainable profitability and long-term shareholder returns.
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 23.37 | 21.5 | 25.0 | 26.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
Strong Revenue Growth and Operational Momentum in Q3 FY2025: In the third quarter of fiscal year 2025, C3 AI delivered robust financial results, marked by a significant year-over-year revenue increase. The company reported total revenue of USD 98.8 million, representing a 26% rise compared to the USD 78.4 million recorded in the same quarter of the previous year. Subscription revenue stood at USD 85.7 million, accounting for 87% of total revenue and reflecting a 22% increase year-over-year. When combined with prioritized engineering services, the total revenue contribution reached USD 91.4 million, or 93% of overall revenue, up 18% from a year ago. The company achieved a GAAP gross profit of USD 58.3 million (59% margin) and a non-GAAP gross profit of USD 68.2 million (69% margin). Despite continued investment in growth, the GAAP net loss per share was USD (0.62), while the non-GAAP net loss per share improved to USD (0.12). The company ended the quarter with a strong liquidity position, holding USD 724.3 million in cash, cash equivalents, and marketable securities.
Leadership in Enterprise AI and Intellectual Property Advancements: Chairman and CEO Thomas M. Siebel emphasized C3 AI’s pioneering role in the field of Enterprise AI. He highlighted the company's innovation in developing the model-driven agentic Enterprise AI platform. According to Siebel, C3 AI is widely credited with inventing this paradigm and has protected its intellectual property through early and strategic patent filings. Notably, the U.S. Patent for agentic generative AI was awarded to C3 AI based on its initial application filed on December 16, 2022. Siebel asserted that the company possesses the critical technology, an experienced management team, and an expansive global partner network needed to transform the Enterprise AI landscape at scale.
Expansion of Strategic Partnerships and Distribution Network: C3 AI made notable strides in strengthening its partner ecosystem during the quarter. The company substantially enhanced its long-standing strategic alliance with Microsoft, expanded its collaboration with AWS, and announced a new partnership with McKinsey & Company’s QuantumBlack. These alliances are designed to accelerate global distribution and adoption of C3 AI’s solutions. Notably, 47 agreements were closed through the partner network, marking a 74% year-over-year increase. The collaboration with Microsoft alone resulted in 28 closed agreements across nine industries—a 460% sequential increase—and significantly expanded the joint sales pipeline to 621 active accounts globally.
Customer Acquisition and Government Sector Growth: C3 AI achieved strong traction in both the commercial and public sectors. The company signed 66 agreements during the quarter, including 50 pilot projects, representing a 72% year-over-year increase. Strategic customer wins included major names such as GSK, Shell, ExxonMobil, Quest Diagnostics, and SmithRx. C3 AI also expanded its presence in the U.S. state and local government sector, securing 21 agreements across states including Texas, California, and New Jersey. In the federal space, new and extended partnerships were established with the U.S. Department of Defense, U.S. Air Force, U.S. Navy, and the Missile Defense Agency. The company also achieved “Awardable” status on the Department of Defense’s Tradewinds Solutions Marketplace, boosting its profile in federal AI procurement.
Generative AI Innovation and Real-World Application: C3 AI continues to innovate within the generative AI domain, enhancing its enterprise-grade offerings. In Q3, the company closed 20 new generative AI pilot programs with organizations such as Mars, Liberty Coca-Cola Beverages, and various government agencies. A key technological milestone was the development of a time series embedding model that enables efficient retrieval and reasoning on sensor data, benefiting applications in anomaly detection and decision support. Customers like SmithRx are leveraging this innovation to streamline operations and improve service delivery, resulting in reduced call times and higher customer satisfaction.
Enterprise-Wide Digital Transformation through AI: C3 AI’s platform is delivering tangible benefits across industries by improving operational efficiency and cost-effectiveness. GSK, for example, is scaling the C3 AI Demand Forecasting application to enhance supply chain performance and optimize the delivery of medicines and vaccines. Similarly, engineering firm Worley is implementing C3 AI’s Supply Chain and Asset Performance Suites, in collaboration with Microsoft, to support nuclear technology projects and broader industrial applications. These real-world implementations underscore the practical value and adaptability of C3 AI’s solutions in complex, mission-critical environments.
Forward Guidance and Strategic Outlook: Looking ahead, C3 AI provided financial guidance for the fourth quarter and full fiscal year 2025. The company expects Q4 revenue to range between USD 103.6 million and USD 113.6 million, with full-year revenue projected between USD 383.9 million and USD 393.9 million. Non-GAAP loss from operations is expected to range from USD (30.0) million to USD (40.0) million for Q4 and USD (87.0) million to USD (97.0) million for the full year. Additionally, the company will host its sixth annual C3 Transform conference in March 2025, bringing together global customers, partners, and industry leaders to share insights and showcase the potential of enterprise AI and generative AI solutions.
As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Speculative Buy’ rating has been given to C3.ai, Inc (NYSE: AI) at the closing market price of USD 23.37 as of May 09,2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Technology Industry: Software - Application
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| AI C3 Ai Inc |
-1.46 5.25% | 26.34 | - | - | 16.27 | 5.88 | 13.49 | -2.2963 |
| CRM Salesforce.com Inc |
-5.2 1.95% | 261.72 | 100.89 | 27.47 | 7.42 | 4.34 | 7.44 | 26.81 |
| SAPGF SAP SE |
4.38 1.48% | 300.55 | 76.28 | 22.88 | 5.61 | 3.84 | 5.59 | 26.18 |
| SAP SAP SE ADR |
2.67 0.90% | 299.61 | 75.80 | 22.37 | 5.62 | 3.75 | 5.51 | 25.79 |
| INTU Intuit Inc |
-7.94 1.05% | 749.28 | 55.56 | 32.68 | 11.28 | 10.07 | 11.62 | 40.11 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is May 09,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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