C3.ai Names New CFO, Tenth to Hold Role In Less Than a Decade
(Bloomberg) -- C3.ai Inc. surged by the most in nine months after reporting strong sales in the last quarter, suggesting that the company’s bet on new artificial intelligence-based apps is paying off.
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Revenue increased 18% to $78.4 million in the fiscal third quarter, topping analysts’ average estimate of $76.1 million. C3.ai estimated sales of $82 million to $86 million in period ending in April, roughly in line with expectations of $84.5 million.
The Redwood City, California-based company, which went public in 2020, is known for its data management and analysis software. It has introduced products over the last year with generative AI, software that creates text and images in response to a user’s prompts, hoping to capitalize on the wide interest in the technology. The company is also transitioning to consumption-based pricing, under which customers essentially pay for what they use. The change has caused some disruption in revenue growth.
“Customer engagement grew 80% year over year,” Chief Executive Officer Tom Siebel said in a statement. “Our significant first mover advantage in Enterprise AI is generating tailwinds as market interest in adopting AI accelerates.”
Read More: C3.ai Criticized for Product Delays, Tom Siebel’s Micromanaging
The shares jumped as much as 26% on Thursday to $37.53, the biggest intraday move since May 30, 2023.
C3.ai, whose ticker is “AI,” tripled in value in the early months of 2023 as AI-mania swept Wall Street. Still, some investors remain skeptical that the company will live up to the hype, a concern that had weighed on share prices in recent months.
Separately, the company announced that Chief Financial Officer Juho Parkkinen, who has been in the role since 2022, will step down and become vice president of finance. Hitesh Lath, who had joined C3.ai in December as chief accounting officer, will succeed Parkkinen.
Lath will be at least the 10th person to hold the CFO role since 2015. One point of caution raised by activist investors last year was the high turnover in the post. The change “is likely to draw questions around underlying reasons for high management churn,” Bloomberg Intelligence analyst Sunil Rajgopal said in an interview, adding that Lath’s accounting background may mean higher scrutiny on costs.
In November, the company cut workers and spoke of the need for cost savings.
(Updates with opening shares from first paragraph)
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