C3 AI stock jumps as revenue rises, 'demand for enterprise AI is intensifying'

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C3 AI stock jumps as revenue rises, 'demand for enterprise AI is intensifying'
Credit: © Reuters.

Shares of C3 AI (AI) surged more than 11% premarket after the company reported its latest quarterly earnings after the close Wednesday, topping consensus expectations and raising its guidance.

The AI technology company reported a Q4 loss per share of ($0.11), $0.19 better than the analyst estimate of a loss per share of ($0.30). Revenue for the quarter came in at $86.6 million versus the consensus estimate of $84.39 million.

Revenue grew 20% year-on-year. Subscription revenue for the quarter was $79.9 million, constituting 92% of total, an increase of 41% compared to $56.9 million one year ago.

The company said it is expecting additional acceleration of C3 AI revenue growth to approximately 23% in FY25.

It sees Q1 2025 revenue between $84 million and $89 million, versus the consensus of $85.891 million. Full-year 2025 revenue is seen from $370 million to $395 million.

"We finished a strong quarter and closed out a huge year for C3 AI. This was our fifth consecutive quarter of accelerating revenue growth," said C3 AI CEO and Chairman Thomas Siebel. "Our full year revenue grew by 16% to $310.6 million, also exceeding the top end of our guidance."

Following the report, analysts at Northland upgraded C3.AI (NYSE: AI ) from Market Perform to Outperform with a price target of $35.00.

The firm stated: "C3.AI posted accelerating subscription growth to 41% in 4Q24, providing evidence that the headwinds from a migration to a usage-based revenue model are abating. Strong pilot growth and demand for genAI suggest high growth can continue in our view."

Analysts at Wedbush said it was another step in the right direction for the company as its growth takes shape.

"The federal sector continues to see strength with federal revenue up over 100% y/y and federal bookings making up ~50% of total bookings in FY4Q24 while closing 13 new and expanded agreements across the federal landscape as the company continues to see strong traction with a substantial federal opportunity seen with C3 closing 65 federal agreements in FY24 (up 48% y/y)," the firm noted.

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