C3.ai, Inc. (AI) Earnings
C3.ai, Inc. is expected to report next earnings on December 2, 2026 (in NaN days), with a consensus EPS estimate of $-0.23. AI has beaten EPS estimates in 11 of its last 12 reported quarters (average surprise -48.1% over the last four).
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| Sep 2, 2026 | $-0.26 | $-0.20 | +23.2% | $52M | +1.3% |
| Jun 3, 2026 | $-0.38 | $-0.33 | +13.2% | $52M | -3.7% |
| Feb 27, 2026 | $-0.29 | $-0.96 | -231.6% | $53M | -30.7% |
| Dec 3, 2025 | $-0.33 | $-0.25 | +23.6% | $75M | -1.8% |
| Sep 3, 2025 | $-0.38 | $-0.37 | +2.6% | $70M | -8.3% |
| May 28, 2025 | $-0.20 | $-0.16 | +20.4% | $109M | +0.9% |
| Feb 26, 2025 | $-0.25 | $-0.12 | +52.0% | $99M | -8.2% |
| Dec 9, 2024 | $-0.16 | $-0.06 | +62.5% | $94M | +3.9% |
| Sep 4, 2024 | $-0.13 | $-0.05 | +62.6% | $87M | +0.5% |
| May 29, 2024 | $-0.30 | $-0.11 | +63.8% | $87M | +2.8% |
| Feb 28, 2024 | $-0.28 | $-0.13 | +53.6% | $78M | +3.4% |
| Dec 6, 2023 | $-0.19 | $-0.13 | +31.6% | $73M | -0.8% |
Source: company filings + earnings calendar. For informational purposes only — not investment advice.
Earnings call summary
Q1 FY2027 · September 2, 2026
AI summary of management’s prepared remarks and analyst Q&A. For informational purposes only — not investment advice.
Management highlights
- **Turnaround Execution**: CEO Tom Siebel returned three months ago to address execution failures. The company has restructured sales, products, services, and cost structures, implementing rigorous management discipline (clear ownership, hard deadlines, weekly reviews). - **Financial Progress**: Revenue exceeded guidance, bookings grew 73%, and operating loss narrowed. Free cash flow turned positive at $2.1 million, compared to negative $54.8 million in the prior quarter. - **Federal Growth**: Federal bookings surged 138% year-over-year. New enterprise agreements include major clients such as Johnson & Johnson, Ford Motor Company, and various U.S. Department agencies. - **Product Strategy**: Focus shifted to the C3 Agentic AI stack. Key products include C3 AI Studio (control plane) and C3 Code (agentic app builder). C3 Code autonomously builds applications from natural language prompts or specifications without manual coding. - **Market Validation**: Forrester Research ranked C3.ai number one across seven categories, including data modeling, agent development, and security certification, against competitors like Palantir and Google. - **Restructuring Savings**: Restructuring is nearly complete, achieving annualized cost savings of approximately $135 million, driven by a ~40% headcount reduction and lower non-employee expenses.
Guidance
- **Q2 FY2027 Revenue**: Guidance set at $51 million to $55 million. - **Q2 FY2027 Non-GAAP Operating Loss**: Expected between $34.5 million and $42.5 million. - **FY2027 Full Year Revenue**: Guidance maintained at $210 million to $240 million. - **FY2027 Full Year Non-GAAP Operating Loss**: Expected between $123 million and $155 million. - **Gross Margin Outlook**: Q2 non-GAAP gross margin expected to moderate to the mid-40s due to selective investments in forward-deployed engineering, following a sequential improvement to 50% in Q1. - **Free Cash Flow**: Expected to broadly align with the non-GAAP operating loss guidance range for the remainder of fiscal year 2027.
Segment performance
The transcript does not provide a breakdown of financial performance by specific product segment. Total revenue for the quarter was $52.4 million, with Subscription revenue at $49.2 million (94% of total) and Professional Services revenue at $3.2 million.
Risks & headwinds
- **Execution Risk**: The turnaround strategy relies heavily on successful execution of the new sales motion and cost controls; failure could result in missed growth targets. - **Margin Compression**: Management anticipates a moderation in non-GAAP gross margins to the mid-40s in Q2 due to increased investment in customer success and forward-deployed engineering. - **Competitive Displacement**: While displacing incumbents in federal sectors, the company faces competition from established players like Palantir, Google, and Databricks. - **Forward-Looking Statements**: Results may differ materially from expectations due to various risks and uncertainties detailed in SEC filings.
Analyst Q&A
Q: Analyst asked how C3.ai won significant federal business and what the pipeline looks like given the 138% YoY growth.
A: CEO stated the federal pipeline is strong, driven by dissatisfaction with incumbent providers and increased government spending in intelligence and defense. He noted the defense budget is increasing significantly, creating traction for C3.ai's solutions.
Q: Analyst inquired about the nature of the upcoming investment in forward-deployed engineers and whether this represents a change in strategy.
A: CEO explained that while they have had these engineers since 2014, they are now over-investing to ensure existing customers achieve desired outcomes. However, he expects long-term mitigation of this need through C3 Code, which automates application building without manual coding.
Q: Analyst asked if the high-end FY2027 revenue guide implies steep acceleration and what gives management confidence to hit it.
A: CEO clarified that his primary focus is establishing consistent quarter-over-quarter revenue growth starting Q3, rather than hitting the high end of the current guide. He believes consistent growth and profitability will justify a higher valuation multiple (10x-25x revenue) compared to the current ~3.5x.
Q: Analyst asked if C3 Code is a meaningful part of the pipeline or still in early marketing stages, and if the strategy is shifting from selling applications to a platform approach.
A: CEO confirmed C3 Code is in early marketing but highly effective, allowing small initial engagements that grow. He validated the analyst's insight that the strategy is shifting: instead of selling monolithic applications, the platform now offers 'atomic particles' that assemble into applications on demand via C3 Code.