Equities company C3.ai saw a 30% rise on Friday after posting upbeat third-quarter results. CEO Thomas Siebel sees a dramatic change in sentiment and expects the company to be profitable in fiscal year 2024.*

C3.ai, Inc.'s performance since going public. Source: tradingview.com

C3.ai, an artificial intelligence provider, posted a lower-than-expected loss of 6 cents per share excluding certain items. Revenue of $66.7 million also beat market estimates of $64.2 million. However, the company has lower equivalents of $790 million, which may mean it is burning cash at an unusually fast pace. The company expects non-GAAP operating profitability in Q4, marking a significant improvement over recent quarterly trends.

CEO Siebel explained that he sees favorable developments early in Q4, stemming from improved business optimism and increased interest in using C3 AI solutions in various industries. Wedbush analyst Daniel Ives said the company is starting to gain momentum in building significant enterprise opportunities within its upcoming suite of innovative enterprise AI solutions. The company expects Q4 revenue in the range of $70 million to $72 million, above analyst estimates.

C3.ai's stock price is currently trading at 5.5 times forward earnings, which is difficult to assess given the uncertain revenue growth as the company transitions to a consumption-based pricing model. The stock started Friday's (March 3) session with a massive bullish price gap and easily cleared resistance at $25.90. If the current sentiment persists, the upward move could accelerate towards the recent high at $30.90 [1].

* Past performance is no guarantee of future results

[1] Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or the current economic environment, which may change. Such statements are not guarantees of future performance. They involve risks and other uncertainties that are difficult to predict. Results may differ materially from those expressed or implied by any forward-looking statements.