C3.ai Stock Plummets: What’s Driving the AI Giant’s Brutal Sell-Off?

Another bloodbath for tech investors—C3.ai shares are getting slaughtered today. Here’s why the market’s turning on the AI darling.

The AI hype bubble deflates… again

Wall Street’s latest love affair with artificial intelligence hits another rough patch as C3.ai tanks. No surprise—these momentum plays always end with someone holding the bag.

Short sellers smell blood

When a stock drops this hard, you can bet the sharks are circling. C3.ai’s valuation was always ambitious—now reality bites.

The closer: Another ‘disruptive tech’ story meets the cold hard math of earnings reports. Maybe next quarter they’ll actually turn a profit… or just launch another buzzword-filled PR campaign to buy time.

C3.ai shares plunge after it shares its preliminary Q1 2026 results

C3.ai's first-quarter 2026 preliminary numbers showed a net generally accepted accounting principles (GAAP) loss of between $124.7 million and $124.9 million on sales of between $70.2 million and $70.4 million, a nearly 20% decline year over year in its top line and 33% below its previous guidance. D.A. Davidson analyst Gil Luria called the results "catastrophic" and downgraded the rating from neutral to underperform.

The company is in the middle of a search for a new CEO after the announcement that Tom Siebel WOULD be stepping down from the role, a major factor in its underwhelming results.

Image source: Getty Images.

Additionally, C3.ai announced that it had completed a significant restructuring of its sales and services divisions to "accelerate growth and increase customer success" after what Siebel called the company's "completely unacceptable" Q1 performance.

C3.ai problems are likely to continue, but a lower share price could make this a buying opportunity

C3.ai is obviously in some hot water and is struggling to close deals amid the exit of its CEO. I don't want to discount the direction of C3.ai's sales at the moment and its continued unprofitability. If the company names the right person as CEO, there's plenty of reason to believe C3.ai can right the ship.

Given how much the share price has dropped, this could present a buying opportunity. C3.ai now trades at a discount compared to some of its closest competitors. Of course, I don't want to imply the stock is cheap in general -- AI stocks are anything but cheap -- but comparatively so.