C3.ai’s Stock (NYSE:AI) Under Pressure Ahead of Earnings Following Prelim Results

C3.ai, Inc. (NYSE: AI), a company once heralded as a leader in enterprise artificial intelligence (AI) software, finds itself in choppy water this year. The AI stock price is currently changing hands at $17 in today's premarket, up 1% on the session, yet down 27.47% on the month leading into today's earnings print, due after the closing bell.

Analysts are currently estimating a loss per share of $0.21 for the current quarter along with revenue estimates of $93.88M. These projections underscore the challenges C3.ai faces in turning its revenue growth into bottom-line profitability.

This latest dip underscores a period of significant volatility driven by disappointing financial results, a major sales reorganization, and a looming change in leadership. The company's current stock performance stands in stark contrast to the lofty expectations surrounding the AI sector.

The immediate catalyst for the recent downturn was the announcement of preliminary fiscal first quarter 2026 results on August 11th. C3.ai projected revenue between $70.2 million and $70.4 million, a sharp decline from the $87.2 million reported in the same period last year and significantly below analyst expectations of around $104.1 million. This shortfall, coupled with a projected GAAP operating loss ranging from $124.7 million to $124.9 million, sent shockwaves through the market.

CEO Thomas M. Siebel's candid admission that the results were “completely unacceptable” only amplified market concerns. Siebel attributed the poor performance to a company-wide sales and services reorganization and his personal health challenges, which limited his involvement in sales activities. The announcement of Siebel's planned departure as CEO further added to the sense of instability. A leadership vacuum at a critical juncture is rarely welcomed by the markets.

The market's reaction was swift and brutal. C3.ai's stock price plummeted by approximately 30% in premarket trading following the earnings warning. This dramatic drop reflects the market's sensitivity to any signs of weakness in high-growth sectors like AI, where expectations are often priced in aggressively.

C3.ai's struggles are not entirely new. While the company reported a 26% year-over-year increase in total revenue to $98.8 million in its fiscal third quarter 2025, the underlying profitability remained a concern. The GAAP net loss per share of $(0.62) highlighted the company's ongoing challenges in achieving sustainable profitability.

Analysts have also pointed to the company's high stock-based compensation as a potential red flag, raising questions about cost management. The reliance on stock-based compensation, totaling $174.4 million over the past nine months, suggests that the company may be diluting shareholder value to attract and retain talent.

While the prevailing sentiment surrounding C3.ai is undeniably bearish, the underlying technology remains compelling, and the demand for enterprise AI solutions is only expected to grow in the coming years. The current challenges, while significant, could potentially end up being temporary setbacks.

The company's strong cash position provides a buffer, and a new CEO could bring fresh perspectives and strategies to address the company's operational issues. Despite playing devil's advocate, sentiment is firmly bearish leading in, and it will take something significant for a shift.