C3 AI Stock Drops Nearly 26% After Q1 Financial Preview and Sales Restructuring
Shares of C3 AI, a company specializing in enterprise artificial intelligence, fell sharply by almost 26% on Monday. The decline followed the release of preliminary financial results and an announcement about restructuring its global sales and services teams.
Revenue Misses Expectations
C3 AI reported expected revenue between $70.2 million and $70.4 million for its fiscal first quarter of 2026. These numbers are preliminary and unaudited. By comparison, the company generated $87.2 million in revenue during the same quarter last year, highlighting a significant drop.
CEO Attributes Sales Shortfall to Reorganization and Health Challenges
Thomas Siebel, CEO of C3 AI, described the quarter's sales results as "completely unacceptable." He linked the disappointing performance to the disruptive impact of the ongoing sales and services restructuring, as well as his reduced involvement in sales due to health problems.
Siebel shared that his health issues, including a diagnosis of an autoimmune disease causing significant visual impairment, have kept him from being as active in sales as before. He acknowledged that his direct participation in sales likely had a bigger influence on results than previously understood.
Widening Losses and Leadership Transition
The company expects a GAAP loss from operations between $124.7 million and $124.9 million for the quarter, nearly double the $72.59 million loss reported a year ago. In response, C3 AI’s board and Siebel have started the search for a new CEO to lead the company forward.
The restructuring of the sales and services teams is now complete. Siebel noted that while his vision impairment remains, his overall health has improved, and he is fully engaged in finding "excellent" CEO candidates.
He expressed confidence that the company is positioned to accelerate growth after these changes take hold.
What Sales Professionals Can Learn
- Leadership engagement matters: The CEO’s active role in sales was a key factor in performance, showing how leadership involvement can impact sales outcomes.
- Restructuring can disrupt: Organizational changes may temporarily affect sales results, so preparing teams and managing transitions carefully is essential.
- Health and availability: Leaders' availability can influence sales momentum, highlighting the importance of building strong sales leadership layers.
Sales professionals should watch how C3 AI’s new leadership and completed restructuring influence future quarters. Staying adaptable and focused during periods of change is critical.
C3 AI will hold a conference call to discuss its first quarter results on September 3 at 5 p.m. ET. This will provide more clarity on the company’s path forward.
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