Gross margins have experienced a structural collapse, falling from 62.1% in 2025Q4 to 21.9% in 2026Q4, indicating significant friction in the company's core software-based revenue generation.
| Sales/Revenue | 250.27M | 389.06M | 310.58M | 266.8M | 252.76M | 183.22M | 156.67M | 91.61M |
| Revenue Growth % | -35.67% | 25.27% | 16.41% | 5.55% | 37.96% | 16.95% | 71.02% | - |
| Cost of Goods Sold | 172.89M | 153.19M | 132.02M | 86.34M | 63.71M | 44.52M | 38.79M | 30.39M |
| COGS % of Revenue | 69.08% | 39.38% | 42.51% | 32.36% | 25.21% | 24.3% | 24.76% | 33.17% |
| Gross Profit | 77.38M | 235.86M | 178.56M | 180.46M | 189.05M | 138.7M | 117.88M | 61.22M |
| Gross Margin % | 30.92% | 60.62% | 57.49% | 67.64% | 74.79% | 75.7% | 75.24% | 66.83% |
| Gross Profit Growth % | -67.19% | 32.09% | -1.05% | -4.54% | 36.3% | 17.66% | 92.55% | - |
| Operating Expenses | 565.05M | 560.29M | 496.9M | 470.95M | 385.17M | 198.96M | 189.38M | 97.26M |
| OpEx % of Revenue | 225.78% | 144.01% | 159.99% | 176.52% | 152.39% | 108.59% | 120.88% | 106.17% |
| Selling, General & Admin | 335.96M | 333.9M | 295.54M | 260.29M | 234.62M | 130.1M | 124.83M | 59.94M |
| SG&A % of Revenue | 134.24% | 85.82% | 95.16% | 97.56% | 92.83% | 71.01% | 79.68% | 65.44% |
| Research & Development | 229.09M | 226.39M | 201.37M | 210.66M | 150.54M | 68.86M | 64.55M | 37.32M |
| R&D % of Revenue | 91.54% | 58.19% | 64.83% | 78.96% | 59.56% | 37.58% | 41.2% | 40.74% |
| Other Operating Expenses | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Operating Income | -487.67M | -324.42M | -318.34M | -290.49M | -196.12M | -60.26M | -71.5M | -36.04M |
| Operating Margin % | -194.86% | -83.39% | -102.5% | -108.88% | -77.59% | -32.89% | -45.64% | -39.34% |
| Operating Income Growth % | -50.32% | -1.91% | -9.59% | -48.12% | -225.47% | 15.72% | -98.37% | - |
| EBITDA | -474.12M | -311.82M | -305.62M | -284.4M | -190.93M | -55.96M | -70.19M | -35.49M |
| EBITDA Margin % | -189.44% | -80.15% | -98.4% | -106.6% | -75.54% | -30.54% | -44.81% | -38.74% |
| EBITDA Growth % | -52.05% | -2.03% | -7.46% | -48.96% | -241.19% | 20.28% | -97.78% | - |
| D&A (Non-Cash Add-back) | 13.55M | 12.61M | 12.72M | 6.09M | 5.19M | 4.3M | 1.3M | 550K |
| EBIT | -469.55M | -287.73M | -278.9M | -268.16M | -191.28M | -60.26M | -71.5M | -36.04M |
| Net Interest Income | 28.45M | 36.19M | 40.08M | 21.98M | 1.83M | 1.25M | 4.25M | 3.51M |
| Interest Income | 28.45M | 36.19M | 40.08M | 21.98M | 1.83M | 1.25M | 4.25M | 3.51M |
| Interest Expense | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | 18.12M | 36.7M | 39.44M | 22.33M | 4.85M | 5.27M | 2.5M | 2.96M |
| Pretax Income | -469.55M | -287.73M | -278.9M | -268.16M | -191.28M | -54.99M | -69M | -33.08M |
| Pretax Margin % | -187.62% | -73.95% | -89.8% | -100.51% | -75.68% | -30.01% | -44.04% | -36.11% |
| Income Tax | 822K | 976K | 792K | 675K | 789K | 704K | 380K | 266K |
| Effective Tax Rate % | -0.18% | -0.34% | -0.28% | -0.25% | -0.41% | -1.28% | -0.55% | -0.8% |
| Net Income | -470.37M | -288.7M | -279.7M | -268.84M | -192.06M | -55.7M | -69.38M | -33.35M |
| Net Margin % | -187.95% | -74.21% | -90.06% | -100.77% | -75.99% | -30.4% | -44.28% | -36.4% |
| Net Income Growth % | -62.93% | -3.22% | -4.04% | -39.97% | -244.85% | 19.72% | -108.05% | - |
| Net Income (Continuing) | -470.37M | -288.7M | -279.7M | -268.84M | -192.06M | -55.7M | -69.38M | -33.35M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -3.35 | -2.24 | -2.34 | -2.45 | -1.84 | -0.90 | -0.73 | -0.45 |
| EPS Growth % | -49.55% | 4.27% | 4.49% | -33.15% | -104.44% | -23.29% | -62.22% | - |
| EPS (Basic) | -3.35 | -2.24 | -2.34 | -2.45 | -1.84 | -0.90 | -0.73 | -0.45 |
| Diluted Shares Outstanding | 140.51M | 129.09M | 119.36M | 109.85M | 104.4M | 56.68M | 95.16M | 73.55M |
| Basic Shares Outstanding | 140.51M | 129.09M | 119.36M | 109.85M | 104.4M | 56.68M | 95.16M | 73.55M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - |
Liquidity and Revenue Contraction
As reported in recent financial statements, C3.ai's revenue has experienced a sharp decline, with the most recent quarter showing a -52.5% year-over-year contraction, suggesting that the company's strategic shift toward a consumption-based pricing model is creating significant friction in maintaining its top-line growth trajectory.
The consistent deceleration from positive growth in 2025 to deep double-digit declines in 2026 indicates that the transition is not merely a timing issue but potentially a fundamental loss of market momentum. Investors should monitor whether this revenue valley is a temporary byproduct of accounting changes or a sign that the platform's value proposition is failing to resonate with enterprise customers.
Based on the company's reported figures, gross margins have deteriorated significantly from a peak of 62.1% in 2025Q4 to just 21.9% in 2026Q4, indicating that the cost of revenue is scaling disproportionately to the company's ability to generate high-margin software-based income.
This margin compression suggests that the company is increasingly reliant on low-margin professional services or is incurring heavy cloud infrastructure costs that are not being offset by pricing power. Such a profile implies that the business model is currently functioning more like a bespoke consultancy than a scalable software enterprise.
According to the income statement data, the company's operating expenses continue to dwarf gross profit, resulting in an operating margin of -2.1% in 2026Q4, which highlights a persistent inability to achieve the economies of scale typically expected from an enterprise software platform of this size.
The failure to scale operating income alongside revenue suggests that the company's cost structure is largely fixed and unresponsive to top-line volatility. Without a clear path to reducing SG&A and R&D as a percentage of revenue, the company appears trapped in a cycle of high cash burn to support its current operational footprint.
As evidenced by the -194.86% operating margin and the recent revenue collapse, the company's reliance on high-touch implementation services may be masking a lack of product-market fit, which warrants investigation into whether the platform can ever achieve the profitability levels required for long-term viability.
Short-sellers would likely focus on the discrepancy between the company's 'AI' branding and its service-heavy margin profile, which suggests that the platform may not be as scalable as management claims. The persistent operating losses, combined with a shrinking revenue base, raise serious questions about the company's ability to survive without further dilutive financing.
Quick answers to the most common questions about buying AI stock.
For fiscal year 2026, C3.ai, Inc. (AI) reported total revenue of $250.3M. This represents a 173.2% increase compared to $91.6M in 2019.
C3.ai, Inc. (AI) reported a net loss of $470.4M for the fiscal year ending 2026.
C3.ai, Inc. (AI) reported an operating income of $-487.7M, resulting in an operating profit margin of -194.9%. This margin reflects the operational efficiency of the business before interest and taxes.
C3.ai, Inc. (AI) generated $77.4M in gross profit for the year, representing a gross profit margin of 30.9%. This demonstrates the company's core pricing power and production efficiency.