C3.ai Trades Near 52-Week Low: Right Time to Buy the Stock?

C3.ai, Inc. (AI) shares have been under pressure, sliding 36.2% over the past three months, steeper than the industry’s 8.5% decline. Over the same stretch, the S&P 500 has risen 9%, highlighting AI’s sharp underperformance.

On Tuesday, C3.ai shares closed at $15.74, barely above its 52-week low of $14.70. In the past three months, its industry peer Palantir Technologies Inc. (PLTR) has risen 19% and Snowflake Inc. (SNOW) has gained 8.1%.

Price Performance

With the AI stock hovering near its 52-week range, investors are left wondering: is this a value entry point or a signal to stay cautious?

Factors Hurting AI

C3.ai’s latest quarterly performance revealed several challenges that are putting pressure on the stock. The company reported a steep year-over-year revenue decline of nearly 20%, with sales missing expectations by a wide margin. Earnings also disappointed, as losses widened at both operating and net levels, while the free cash flow turned negative. These results highlighted the company’s inability to convert its large market opportunity into meaningful growth.

A major factor behind the weak quarter was poor sales execution. Management admitted that leadership changes and restructuring in the sales and service teams created confusion and slowed deal conversions. The company also relied heavily on initial production deployments, which carry higher upfront costs and offer limited immediate revenues. This shift in the revenue mix reduced scale efficiencies and dragged the gross margin down to 52%, well below where investors would like it to be.

Another red flag was the withdrawal of the full-year guidance. While the company issued revenue projections for the next quarter, it chose not to provide a clear outlook for the rest of the fiscal year. This decision signals management’s uncertainty about the pace of recovery and leaves investors with limited visibility into near-term performance. Such a lack of guidance often heightens market skepticism, particularly for a business that has just posted its first major revenue miss since going public.

On top of financial struggles, C3.ai is undergoing significant leadership transitions. The founder stepped back from day-to-day operations due to health issues, and a new CEO has just been appointed. While this move can strengthen the organization over time, it also introduces risk during a critical period when execution is already faltering. Altogether, declining revenues, widening losses, margin pressure, execution missteps and leadership instability are all weighing heavily on investor confidence in the stock.

Can AI Stock Make a Comeback?

Despite a disappointing quarter, C3.ai continues to highlight strong long-term opportunities that may aid its stock. The company emphasized its expanding customer base, with wins across industries such as manufacturing, chemicals, defense and government. Partnerships with large enterprises like Nucor, Qemetica and Huntington Ingalls show that C3.ai’s technology is being adopted for complex, large-scale operations.

In addition, the U.S. Army has begun deploying its agentic AI platform for frontline logistics, underscoring the trust placed in its solutions for critical national defense use cases. These engagements demonstrate that while near-term execution has faltered, the demand for C3.ai’s technology remains intact and broadening.

Management also pointed to a strengthened organizational structure and new leadership as steps toward stability and growth. The appointment of a new CEO with proven experience in building and scaling AI companies, alongside a restructured global sales and services organization, is aimed at resolving past execution challenges.

C3.ai’s vast product portfolio of more than 130 enterprise AI applications and its new Strategic Integrator Program position it to capture greater market share. With an estimated $2-trillion addressable market in enterprise AI, the company believes that it has the technology, partnerships and leadership in place to accelerate adoption. If execution improves, these strategic initiatives can help C3.ai regain investor confidence and drive long-term growth.

C3.ai’s Estimate Revision Trend

The Zacks Consensus Estimate for fiscal 2026 and 2027 loss per share has widened in the past 30 days, as shown in the chart.

The Zacks Consensus Estimate for fiscal 2026 and 2027 sales implies a year-over-year decline of 5.6% and growth of 15.2%, respectively. Meanwhile, Palantir Technologies’ sales in 2025 are likely to increase 45.6% year over year, whereas Snowflake’s sales in fiscal 2026 are likely to witness growth of 26.7%.

C3.ai Valuation

AI is priced at a discount relative to its industry. It has a forward 12-month price-to-sales ratio of 5.46, which is well below the industry average. Meanwhile, Palantir Technologies and Snowflake’s forward 12-month price-to-sales ratios are 75.22 and 14.42, respectively.

P/S (F12M)

End Notes

Despite securing big-name customers across industries and launching initiatives like the Strategic Integrator Program to tap into new market opportunities, C3.ai's stock looks risky at present.

Investors may want to avoid C3.ai’s stock now as it faces a mix of operational and strategic headwinds. Recent results exposed weak execution, with sales disruptions and leadership changes weighing on performance and eroding confidence. The withdrawal of the full-year guidance highlights management’s uncertainty about near-term prospects, leaving investors without clear visibility. At the same time, the reliance on costly short-term deployments has pressured margins and slowed revenue conversion, making profitability harder to achieve.

Combined with leadership instability during a critical transition period, these challenges suggest that the stock may struggle to rebound until execution improves and the business regains consistency. AI currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research