C3 AI, a provider of turnkey AI solutions for enterprises, is down around 12 percent in the after-hours trading session after providing a largely subpar earnings update for its fiscal Q1 2026, while also announcing a CEO replacement as a part of its nearly concluded restructuring efforts.
For the benefit of those who might not be aware, C3 AI currently has two main products: its agentic AI platform that offers a plethora of pre-built, low-code/no-code, AI-powered applications to automate mundane corporate tasks, and its generative AI platform that offers access to a number of large language models (LLMs) in a tailored environment to seamlessly interact with enterprise data.
For the first quarter of 2026, C3 AI reported $70.3 million in revenue vs. consensus expectations of of $94.5 million. The company reported an EPS of -$0.37, significantly wore than the consensus estimate of -$0.20. It also reported a non-GAAP gross profit of $36.3 million corresponding to a margin of 52 percent.
To complete its trifecta of bad news, C3 AI delivered an ultra-light guidance for its fiscal Q2 2026, projecting a top-line figure of between $72 million and $80 million, versus the consensus estimate of $99.6 million. The company, however, chose to withhold its guidance for Q3 and FY 2026 for now.
In what is a rare bit of good news, C3 AI has appointed Stephen Ehikian, who brings extensive AI expertise and leadership experience to the proverbial table, as the new CEO, effective the 01st of September.
The real fireworks, however, began during C3 AI's earnings call, when its chairperson, Thomas Siebel, declared that the just-revealed results were "completely unacceptable in virtually every respect."
While expounding on his declaration, Siebel identified one key reason for the company's subpar performance: restructuring-induced upheaval leading to confusion among key sales nodes, and compounded by Siebel's illness that prevented him from offering critical coordination at that juncture.
On the positive front, C3 AI has now concluded its restructuring activities, and appears poised to resume its hyper growth trajectory.
Siebel also disputed a recent MIT report that said around 95 percent of enterprise generative AI projects were not generating any return, going on to declare that a "majority" of C3 AI's LLM deployments were successful, owing to the holistic solutions that it provides.
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