Updated: December 7, 2025
Key Takeaways
- C3.ai Inc (NYSE: AI) closed Friday, December 5, 2025, at $15.08 per share, roughly a 7% gain for the week but still more than 60% below its 52‑week high around $45. [1]
- The company’s Q2 FY 2026 results showed revenue of $75.1 million, down about 20% year over year, with a GAAP loss of $0.75 per share and non‑GAAP loss of $0.25, but bookings and federal deals surged. [2]
- A new U.S. Department of Health and Human Services (HHS) contract positions C3.ai as an enterprise AI platform across NIH and CMS, reinforcing its federal footprint. [3]
- Since December 6, 2025, fresh analysis has been sharply divided:
- Wall Street targets now range from $10–$24 per share, with overall sentiment hovering between “Moderate Sell/Reduce” and “Neutral”, and modest upside versus the current price. [6]
1. How C3.ai Stock Has Traded Around December 6, 2025
C3.ai’s share price has been volatile into early December:
- Week of December 1–5, 2025
- Dec 1 close: $14.09
- Dec 5 close: $15.08
→ Roughly +7% gain for the week, matching TipRanks’ figure of a 7.03% rise over the last seven days. [7]
- Friday, December 5, 2025 (the last trading day before Dec 6)
- Closed at $15.08, down 1.57% on the day, breaking a three‑day winning streak.
- Still 66–69% below the 52‑week high of $45.08 set in December 2024. [8]
Real‑time data as of the latest trade shows the stock around $15.08 with a market cap near $2.1 billion. [9]
Bottom line on price action: Into the weekend of December 6–7, C3.ai is in short‑term rebound mode but still in a long‑term drawdown, trading at only a fraction of its AI‑hype peak.
2. Q2 FY 2026 Results: Revenue Down, Bookings Up, Losses Deepen
C3.ai reported fiscal Q2 2026 results (quarter ended October 31, 2025) after the close on December 3, 2025. [10]
Headline numbers
From the company’s official release and follow‑up analysis: [11]
- Total revenue:
- $75.1 million vs. $94.3 million in Q2 FY 2025 → roughly ‑20% year‑over‑year.
- Subscription revenue:
- $70.2 million, about 93% of total revenue.
- Margins and earnings:
- GAAP gross margin: ~40%
- Non‑GAAP gross margin: ~54%
- GAAP net loss per share:‑$0.75
- Non‑GAAP net loss per share:‑$0.25 (a smaller loss than many analysts expected).
- Cash position:
- Around $675 million in cash, cash equivalents and marketable securities, providing a sizable liquidity cushion despite losses.
Bookings and federal business
Where C3.ai surprised positively was bookings, particularly in the federal segment: [12]
- Total bookings rose 49% quarter over quarter, with 46 agreements signed.
- 17 deals exceeded $1 million, and six were above $5 million.
- Federal, defense and aerospace bookings grew 89% year over year and represented 45% of total bookings.
- About 89% of bookings were driven with or through partners such as Microsoft, AWS, McKinsey, Baker Hughes and Booz Allen.
Independent research firms, including Simply Wall St, note that despite the upbeat bookings, net income losses have widened: net loss over the last twelve months is estimated around $381 million, with TTM revenue of about $352.9 million, highlighting that the company is still a long way from GAAP profitability. [13]
3. New HHS Deal: Strengthening C3.ai’s Government Moat
One of the most consequential pieces of news feeding into the stock since early December is the U.S. Department of Health and Human Services (HHS) contract announced on December 4, 2025. [14]
Under this agreement:
- HHS selected C3 AI’s Agentic AI Platform as its enterprise AI platform.
- The company will unify disease‑specific NIH data enclaves with Medicare, Medicaid, claims and state registry datasets into a single, secure data foundation.
- The system is designed to:
- Improve data quality and governance,
- Support biomedical research and public‑health analytics, and
- Automate complex administrative workflows with AI.
TipRanks notes that this HHS win has been a key driver behind the stock’s ~7% weekly gain, reinforcing the narrative that federal contracts could anchor the next leg of growth for C3.ai. [15]
4. Guidance and Revenue Forecasts After Q2
C3.ai had previously unnerved investors by withdrawing full‑year guidance amid leadership turbulence earlier in 2025. [16]
However, with Q2 FY 2026 results, management re‑introduced revenue guidance: [17]
- Q3 FY 2026 revenue outlook:
- $72–$80 million
- Full‑year FY 2026 revenue outlook:
- $289.5–$309.5 million
Benzinga and Investing.com highlight that this guidance brackets consensus but still implies a ~23% revenue decline for FY 2026, reflecting C3.ai’s decision to prioritize higher‑value deals and federal work over more commoditized commercial contracts. [18]
At the same time, Simply Wall St notes that analysts modelling beyond the current fiscal year still expect around 16% annual revenue growth over the next three years, but no GAAP profitability within that window—a key tension for investors trying to justify C3.ai’s premium valuation. [19]
5. What Changed Since December 6, 2025: Fresh Analyses and Sentiment Split
Since December 6, 2025, a wave of new commentary has hit C3.ai, shaping weekend sentiment around the stock.
5.1 24/7 Wall St: “The Forgotten AI Stock That’s Better Left Forgotten”
In a widely shared piece dated December 5–6, 24/7 Wall St characterizes C3.ai as “the forgotten AI stock” that may still not be worth revisiting: [20]
Key bearish points:
- The stock is down about 59% over the past year and roughly 92% from its peak, leaving C3.ai with a market cap near $2 billion.
- Revenue fell 20% year over year in the latest quarter to $75.1 million, underscoring execution problems despite the broader AI boom.
- The company has burned tens of millions in cash over the past four quarters, reinforcing concerns about sustainability.
- After founder and former CEO Thomas Siebel stepped down in September 2025 for health reasons, guidance was withdrawn and strategic uncertainty increased.
The article concedes that Q2 offered a “rare bright spot”—with revenue slightly ahead of forecasts and strong federal bookings—but argues this looks more like a dead‑cat bounce than a durable turnaround.
5.2 Simply Wall St: Deepening Losses and Premium Valuation
Simply Wall St’s December 5 analysis digs into the numbers behind the headline: [21]
- Net loss (ex‑extra items) for Q2 FY 2026: about $104.7 million, vs. roughly $66 million a year earlier.
- Trailing 12‑month revenue: ~$352.9 million, growing just 3.7% per year, compared with about 10.6% for the broader U.S. market.
- The stock trades at roughly 6× trailing sales, versus ~5× for the broader U.S. software industry and ~2.2× for peers.
- Analysts expect 16.4% annual revenue growth in coming years, but TTM EPS is about –$2.84, and losses have grown at ~25% per year over the last five years.
Their conclusion: C3.ai’s slowing growth, deepening losses and premium valuation leave little room for error and reinforce the bearish profitability narrative, even though the balance sheet is relatively clean and cash‑rich.
5.3 TipRanks: Weekly Surge but “Moderate Sell” Consensus
TipRanks’ weekend update, “C3ai’s Stock Surges Amid Key Developments,” emphasizes that the stock has risen about 7% over the past week, driven by the HHS win and the Q2 beat on EPS. [22]
Yet, their data show:
- A “Moderate Sell” consensus rating.
- A 12‑month average price target around $15.43, only slightly above the current ~$15 price.
- Ongoing concerns about leadership changes, lack of a clear path to profitability, and a crowded AI software landscape.
In other words, the short‑term momentum is real, but the long‑term conviction remains weak.
6. Wall Street Analyst Targets: From Underperform to Outperform
Analyst reaction since the earnings release and HHS contract has been sharply split.
6.1 DA Davidson: Underperform, $13 Target
Both Investing.com and MarketBeat report that DA Davidson has reiterated an Underperform rating with a $13 target, implying meaningful downside from the ~$15 level: [23]
- They highlight:
- The 60%+ share price drop over the last year.
- Revenue declines and persistent losses, with diluted EPS around –$2.60 over the last 12 months.
- A FY 2026 guidance that signals revenue contraction, not growth.
- DA Davidson remains skeptical that the company can re‑accelerate growth and reach profitability fast enough to justify even current prices.
6.2 Citizens: Market Outperform, $24 Target
By contrast, Citizens has reiterated a “Market Outperform” rating with a $24 price target, suggesting about 60% upside from around $15. [24]
Their bullish thesis leans on:
- A broad portfolio of enterprise and generative AI applications, especially in predictive maintenance and supply chain.
- A strong partnership with Microsoft, including 100+ customer agreements across 17 industries and a 146% year‑over‑year increase in joint qualified pipeline.
- Federal bookings up 89% year over year, even amidst a government shutdown.
- A large total addressable market (TAM)—C3.ai pegs it at $271 billion for 2024—and a cash‑rich balance sheet with more cash than debt.
- The possibility that C3.ai could be an acquisition target, with Reuters reportedly noting the company is exploring a potential sale, though any process remains early. [25]
6.3 Other Major Brokers and Consensus
Benzinga’s analyst roundup after Q2 highlights additional calls: [26]
- Wedbush (Dan Ives): Outperform, $20 target – sees Q2 as evidence that new CEO Stephen Ehikian is beginning to “turn the ship around” and underscores the importance of hyperscaler partnerships.
- Canaccord Genuity (Kingsley Crane): Hold, $16 target – notes sequential improvement but still 20% YoY revenue decline and pressure on margins.
- Needham (Mike Cikos): Hold – acknowledges federal bookings as a “durable growth engine” but remains cautious about execution.
- Several other brokers (UBS, Morgan Stanley, KeyBanc, JMP, DA Davidson) have price targets ranging roughly from $10 to $24. [27]
Separate quantitative roundups show: [28]
- Around 6–15 analysts covering the stock, depending on the dataset.
- An overall rating drifting between “Reduce/Moderate Sell” and “Neutral”.
- Average 12‑month price targets clustered in the mid‑teens – e.g., around $15–$16, implying only modest upside from current levels.
7. Leadership Turmoil, Lawsuits and Takeover Talk
Beyond the numbers, governance and strategy remain central to the C3.ai story.
7.1 CEO Transition and Sales Execution
AInvest and other outlets recap a messy leadership transition in 2025: [29]
- Founder and long‑time CEO Thomas Siebel stepped down in September 2025 for health reasons.
- Stephen Ehikian, with a background in enterprise software sales (including Salesforce), took over as CEO.
- Reports describe “confusion and reduced sales productivity” around the transition, contributing to a 19% revenue drop in Q1 FY 2026 and a net loss of about $117 million.
- The company also faces investor lawsuits alleging misleading statements about prior guidance.
On the Q2 call and in the press release, Ehikian emphasized a “detailed execution plan” focusing on areas of demonstrable leadership and faster‑growing sectors, aiming to return to growth and eventually non‑GAAP profitability. [30]
7.2 Strategic Partnerships and Air Force Contract
AInvest also points to strategic partnerships and defense work as key offsets to execution risk: [31]
- Deeper integrations into Microsoft’s Copilot, Fabric and Azure AI Foundry.
- A $450 million contract expansion with the U.S. Air Force, supporting defense and industrial‑base initiatives.
- A “Strategic Integrator Program” licensing C3 AI’s Agentic platform to partners like Booz Allen, which can build industry‑specific solutions on top.
These partnerships underpin the bullish view that C3.ai can ride the AI wave via hyperscaler ecosystems without matching their capital intensity.
7.3 M&A Speculation
Multiple commentaries reference market consolidation and takeover speculation: [32]
- Reports suggest C3.ai has explored a potential sale, with both strategic and financial buyers considered.
- Potential acquirers speculated in the media include cloud giants (e.g., Microsoft, Amazon) and cybersecurity players, though no firm offers are public.
- Analysts caution that weak financials and ongoing losses could cap any acquisition premium.
For investors, this M&A optionality is a wildcard: it could crystallize value quickly or never materialize at all.
8. Macro Context: AI Stocks, Hype and Bubble Warnings
Recent macro research adds another layer to the C3.ai debate:
- Barron’s notes that many AI stocks are being priced more on distant future potential than on near‑term cash flow or earnings, with loss‑making software names often outperforming more profitable peers during the 2025 AI boom. [33]
- The OECD has warned that a potential AI‑driven stock market bubble is a key downside risk to the U.S. economy, given how much equity markets depend on sustained AI optimism. [34]
C3.ai fits squarely into this theme: a loss‑making AI software company with huge TAM claims, volatile sentiment and valuation driven largely by expectations, not current profitability.
9. Bull vs. Bear Case for C3.ai Stock Right Now
Putting the latest news and analysis together, here’s how the investment debate looks after December 6, 2025.
9.1 Bull Case
Supporters of C3.ai focus on:
- Explosive federal momentum
- 89% YoY growth in federal bookings and the HHS win suggest C3.ai is becoming a go‑to AI platform for U.S. government agencies. [35]
- Deep big‑tech partnerships
- Close ties with Microsoft, AWS and other hyperscalers dramatically expand distribution and pipeline, with some analysts citing triple‑digit growth in joint pipelines. [36]
- Strong balance sheet
- Around $675 million in cash and minimal debt give C3.ai years of runway to execute its strategy. [37]
- Potential M&A upside
- If a large cloud or cybersecurity company acquires C3.ai, current shareholders could see a premium to the current share price, even if not close to the old highs. [38]
From this angle, C3.ai is a small, high‑beta AI platform with leverage to U.S. government digitalization and cloud ecosystems, and the current valuation could look cheap if growth and margins normalize.
9.2 Bear Case
Skeptics emphasize:
- Revenue contraction and slowing growth
- Q2 FY 2026 revenue fell ~20% YoY, and full‑year guidance points to a 23% decline—unusual for a supposed high‑growth AI play. [39]
- Deep and widening losses
- Annual losses around $381 million and a long history of negative free cash flow suggest no near‑term line of sight to GAAP profits. [40]
- Premium valuation despite poor fundamentals
- Trading at roughly 6× sales, more expensive than many software peers and far above the broader market, even as growth lags and profitability is distant. [41]
- Execution risk under new leadership
- Leadership turnover, lawsuits and prior guidance missteps make it harder to trust long‑term plans and targets. [42]
- Competitive pressure and AI bubble risk
- Larger players are integrating AI more deeply and at scale, while macro bodies like the OECD warn that AI valuations could be fragile. [43]
From this perspective, C3.ai looks like a speculative turnaround story priced as if success is more likely than the fundamentals yet justify.
10. What Investors Should Watch Next
For readers tracking C3.ai stock after December 6, 2025, the next catalysts and data points to watch include:
- Delivery vs. Q3 and FY 2026 guidance
- Whether C3.ai can hit the $72–$80 million Q3 revenue range and stabilize or re‑accelerate growth, especially in subscriptions. [44]
- Federal and HHS execution
- Concrete updates on HHS deployment, NIH/CMS data integration and additional federal wins will show whether bookings are turning into sustained high‑margin revenue. [45]
- Cash burn trajectory
- Trends in free cash flow and operating losses will determine how long the current cash pile can support operations without dilution. [46]
- Any confirmed M&A process
- Formal news about sale talks, strategic alternatives or major strategic investments could re‑rate the stock quickly in either direction. [47]
- Macro sentiment on AI software
- Broader moves in AI stocks—alluded to by Barron’s and the OECD—will likely continue to influence C3.ai’s valuation as much as its own fundamentals. [48]
11. Final Thoughts (Not Investment Advice)
As of December 7, 2025, C3.ai sits at an interesting crossroads:
- Price: around $15 per share, a modest bounce from recent lows but far below prior highs. [49]
- Business: a company with real federal traction, strong partners and a large cash buffer, but also shrinking revenue, heavy losses and intense competition. [50]
- Sentiment: bifurcated—some see a high‑risk, high‑reward turnaround or takeover candidate, while others see an overhyped, structurally challenged AI stock best avoided. [51]
For anyone considering the stock, these developments are general information, not financial advice. It’s important to:
- Align any decision with your own risk tolerance, time horizon and diversification, and
- Consult with a qualified financial advisor before making high‑risk, single‑stock investments—especially in a sector as volatile as AI.
References
1. stockanalysis.com, 2. c3.ai, 3. c3.ai, 4. 247wallst.com, 5. www.investing.com, 6. www.marketbeat.com, 7. stockanalysis.com, 8. www.marketwatch.com, 9. www.sofi.com, 10. c3.ai, 11. c3.ai, 12. c3.ai, 13. simplywall.st, 14. c3.ai, 15. www.tipranks.com, 16. 247wallst.com, 17. c3.ai, 18. www.benzinga.com, 19. simplywall.st, 20. 247wallst.com, 21. simplywall.st, 22. www.tipranks.com, 23. www.marketbeat.com, 24. www.investing.com, 25. www.investing.com, 26. www.benzinga.com, 27. www.quiverquant.com, 28. www.sahmcapital.com, 29. www.ainvest.com, 30. c3.ai, 31. www.ainvest.com, 32. www.investing.com, 33. www.barrons.com, 34. www.axios.com, 35. c3.ai, 36. c3.ai, 37. c3.ai, 38. www.investing.com, 39. c3.ai, 40. simplywall.st, 41. simplywall.st, 42. www.ainvest.com, 43. www.axios.com, 44. c3.ai, 45. c3.ai, 46. simplywall.st, 47. www.investing.com, 48. www.barrons.com, 49. stockanalysis.com, 50. c3.ai, 51. www.ainvest.com
