There's an almost poetic irony — almost cruel — in the fact that the company holding the $AI ticker on American exchanges is melting down while the entire world won't stop talking about artificial intelligence.
C3 AI, the one that opened at $100 per share in 2020 and hit $180 during the post-IPO euphoria, is now trading at a measly $10. And on Thursday, it cratered another 17%, hitting its all-time low.
Read that again: all-time low. In the middle of the biggest AI revolution in human history.
If that doesn't tell you something about this market circus, nothing will.
The Numbers Nobody Wanted to See
C3 AI's fiscal third quarter was an unvarnished disaster. The company reported $53 million in revenue — the market was expecting $76 million. This isn't a "slight miss." It's missing the target by 30%. It's the financial equivalent of taking a penalty kick and hitting the ball boy.
The loss per share came in at 40 cents, versus the expected 29 cents. And as if the quarterly bloodbath wasn't enough, the guidance for Q4 is even more depressing: revenue between $48 million and $52 million, when Wall Street was expecting $78 million.
The projected operating loss? Between $56 million and $64 million. Above the $48 million that analysts — already pessimistic — had in their spreadsheets.
Damn, this company isn't missing by a little. It's missing by a canyon.
The New CEO and the Machete
Stephen Ehikian, who took over as CEO in September after Thomas Siebel had to step down due to health issues, did what every new CEO does when they walk into a house on fire: ordered everything to be slashed.
26% of the global workforce. Gone. Out the door. Plus a 30% reduction in costs with contractors and vendors.
Ehikian's line on the earnings call is practically a case study in canned corporate communication: "Every CEO is making AI a strategic priority, and our products deliver exactly that." But right after came the knife twist: "It became clear to me that our cost structure was simply too high, and we were not organized correctly for the opportunity."
Translated from corporate-speak into plain English: the company was spending like it was OpenAI but bringing in revenue like a lemonade stand.
Citizens already downgraded the stock from "outperform" to "market perform" — which in Wall Street dialect is the polite equivalent of saying "run from this dumpster fire, but I can't officially say that." Analyst Patrick Walravens cited "near-term challenges in new business and intensifying competition." What a shocker.
The Real Problem Nobody Wants to Admit
Here's what bugs me: C3 AI has been around since 2009. It's not some garage startup. It had all the time and capital in the world to position itself. But while OpenAI, Anthropic, Google, and Meta were building game-changing models, C3 AI was busy selling enterprise AI solutions that, apparently, nobody was buying with enough enthusiasm.
Having the "AI" ticker doesn't make you a relevant artificial intelligence company. Just like slapping "blockchain" on your name in 2017 didn't turn you into a crypto company. Remember Long Blockchain Corp? Exactly.
The enterprise AI market is real. It's massive. But it's brutally competitive. And when you're competing with Microsoft, Google, Amazon, and a horde of startups swimming in billions in funding, your cost structure can't be "simply too high." That's a slow-motion death sentence.
From $180 to $10. A 94% destruction of value for anyone who bought at the top. That's the price of buying narrative without looking at fundamentals.
The Lesson That Keeps Repeating
Charlie Munger used to say the market is a machine for transferring money from the impatient to the patient. But in C3 AI's case, it transferred money from the naive to the insiders who sold at the IPO at $100.
Every time the market creates a hype cycle — AI, metaverse, cannabis, SPACs — a wave of companies shows up with a pretty ticker, a flawless PowerPoint deck, and zero ability to deliver. And every single time, thousands of investors fall into the same trap.
The question that lingers: how many of the "AI companies" in your portfolio right now are the next C3 AI?
Think about that before you go to sleep.
