Key Takeaways:
- Revenue of $51.6M beat consensus of $50.2M in Q4 FY2026.
- Non-GAAP net loss of $0.33 per share narrowed from analyst estimates of -$0.38.
- Founder Tom Siebel returned as CEO, buying $69M in shares and cutting costs 35%.
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C3.ai beats Q4 estimates with $51.6M revenue as Siebel returns
C3.ai reported Q4 revenue of $51.6M, beating consensus estimates, as founder Tom Siebel returned to lead a sweeping restructuring after calling sales performance "staggeringly disappointing."
"The performance of this company has been staggeringly disappointing," Chairman and Chief Executive Officer Thomas M. Siebel said on the earnings call. He added that the company's market multiples are "well earned" and that sales execution has been "unspeakably horrible."
The company posted a non-GAAP net loss of $0.33 per share, narrower than the $0.38 loss analysts projected, according to Zacks data. Subscription revenue of $48.4M accounted for 94% of total revenue, while professional services contributed $3.2M. Non-GAAP operating expenses fell to $106M from $139.9M a year earlier, reflecting a headcount reduction of about 35% to 700 employees.
Shares rose as much as 8% in after-hours trading. The FY2027 revenue outlook of $210M to $240M sits below the $246.7M to $250.7M midpoint in FY2026, meaning the company faces another year of contraction before any recovery.
Siebel, who resumed the chief executive role after a nine-month hiatus, personally purchased 6.17 million shares at $11.16 each, injecting about $69M into the company's cash balance. The company ended the quarter with $575.4M in cash, updated to $673M after the share purchase.
The restructuring plan, first introduced in February, has been expanded and accelerated. Headcount fell to about 700 from roughly 1,070 in January, with annualized cost savings of about $130M realized so far, tracking toward a $135M target. Siebel reorganized the sales, product, and federal divisions under new leadership, broadening the target account base to about 1,000 opportunities from a prior focus on 100 to 150 accounts per region.
For the first quarter of FY2027, C3.ai guided revenue between $50M and $54M, with a non-GAAP operating loss of $40.5M to $48.5M. The full-year FY2027 revenue forecast of $210M to $240M compares with FY2025 revenue of $389.06M and the FY2026 midpoint of about $248.7M.
Siebel attributed the revenue decline to "sales execution" rather than product quality, customer churn, or market demand. The company said it has not experienced significant loss of production customers. Siebel pointed to Palantir Technologies as a competitor with a similar go-to-market approach that has executed well in the same enterprise AI market.
The beat and Siebel's return provide a near-term sentiment boost, but the FY2027 guidance implies the company has not yet stabilized revenue. Investors will watch the Q1 FY2027 earnings call for evidence that the restructured sales organization can convert the expanded account pipeline into measurable growth.
This article is for informational purposes only and does not constitute investment advice.
