Key Takeaways
• C3.ai saw an unusually high spike in options activity on May 9, with call volume rising 122% above its daily average
• The company’s recent earnings revealed a significant loss and declining financial metrics, despite modest revenue growth
• Key executives, including CEO Thomas Siebel, have sold large amounts of stock in recent months
• Analysts remain mixed on the stock’s future, with ratings ranging from “sell” to “strong buy” and a consensus price target of $29.58
C3.ai Options Volume Spikes Amid Financial Losses and Insider Sell-Offs
C3.ai (NYSE:AI), an enterprise AI software provider, experienced an unexpected surge in call options trading on May 9, raising attention among traders and analysts.
According to DefenseWorld, 149,780 call options were traded on that day alone, a 122% increase over the company’s average daily volume of 67,453 contracts.
The significant uptick in options activity comes at a time when the company is facing multiple headwinds, including negative earnings, weakening margins, and high-profile insider selling.
Market Context and Trading Volume
C3.ai stock opened at $23.43 on the same day, below its 200-day moving average of $28.55 and far off its 52-week high of $45.08. Despite this, the surge in options trading suggested bullish sentiment—or speculative positioning—among investors.
• The company’s 50-day moving average was $21.33, reflecting recent price volatility
• Its market capitalization stands at approximately $3.11 billion
• The stock has a beta of 1.99, indicating higher-than-average volatility
The discrepancy between trading enthusiasm and financial performance has fueled debate over whether the volume spike signals confidence in the company’s long-term prospects or short-term speculative behavior.
Financial Results Reveal Operational Challenges
On February 26, C3.ai reported a loss of $0.62 per share, significantly wider than the consensus estimate of a $0.25 loss. The company’s net margin fell to -79.17%, and return on equity dropped to -31.31%, highlighting ongoing profitability concerns.
C3.ai reported quarterly revenue of $98.78 million, narrowly beating analyst expectations of $98.12 million.
Despite meeting top-line revenue forecasts, the results underscored deeper issues in operational efficiency and margin control. Analysts now project the company will report a full-year loss of $2.44 per share.
Insider Activity Draws Attention
Insider trading activity has further fueled market scrutiny. In recent months, multiple senior executives have sold shares, including CEO Thomas Siebel, who offloaded 27,010 shares on May 2. The sale totaled $601,512.70, reducing his ownership stake by more than 50%.
• Over the past three months, insiders have sold 1,461,977 shares valued at approximately $37.4 million
• Insider ownership stands at 33.54% of total outstanding shares
• Vice President Merel Witteveen also sold 1,133 shares in March, valued at $25,209.25
While insider selling can occur for various reasons, such as tax planning or portfolio diversification, the scale and timing of these sales have raised concerns among investors about management’s outlook.
Analyst Ratings Reflect Uncertainty
Market analysts remain divided on C3.ai’s potential. The current breakdown includes:
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5 sell ratings
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5 hold ratings
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4 buy ratings
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1 strong buy rating
The average target price is $29.58, indicating moderate upside from current levels. However, recent revisions have lowered expectations:
Piper Sandler reduced its target from $42.00 to $28.00; DA Davidson cut its forecast from $25.00 to $18.00.
These adjustments reflect a cautious stance amid uncertainty about C3.ai’s growth trajectory and near-term profitability.
The sharp increase in options trading volume may signal renewed investor interest or tactical positioning ahead of potential news.
However, with ongoing financial losses, insider divestitures, and mixed analyst sentiment, the path forward for C3.ai remains uncertain.
Investors and market watchers will be monitoring closely to see whether this surge in trading represents a turning point or just temporary volatility in a highly watched AI sector stock.
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