Why this hot AI trade just got smoked: Opening Bid top takeaway
The adjusted operating loss will be $57.7 million to $59.9 million, roughly twice the $23.5 million to $33.5 million loss it had expected.
I don't think there's anything to read into the AI trade here — this seems very company-specific and tied to a major sales reorganization. The company is also reeling as spiritual leader and CEO Tom Siebel continues to deal with health issues, which have prompted him to search for a successor.
"But I think now is probably the time to pivot away from some of the pure plays and go to more of bank shots on AI, and names like that would be in the industrials that, you know, aren't even tech stocks, but are benefiting from all of the infrastructure spending," John Campbell of Allsprings Global Investments said on Opening Bid.
"So there's some companies like Powell Industries or Emcor that are more focused on electrical equipment or even construction of data centers," Campbell added.
As for C3.ai, it could take the company several quarters to get its mojo back. In the meantime, I would expect the Street's earnings per share estimates for the next two years to collapse.
"We have previously lacked conviction around the durability of growth given an increasing reliance on nonrecurring revenue and suspect the preliminary results reflect this trend," DA Davidson analyst Lucky Schreiner said. "It is likely the business gets worse before it gets better from here."
Brian Sozzi is Yahoo Finance's Executive Editor and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email
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