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    Will HHS Agentic AI Win and Rising Federal Bookings Change C3.ai’s (AI) Growth Narrative?

    Simply Wall St·12/07/2025 06:14:42
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    • In the past few days, C3.ai reported fiscal Q2 2026 results showing sequential revenue growth to US$75.15 million and a smaller-than-expected loss, while announcing that the U.S. Department of Health and Human Services selected its Agentic AI Platform to build a unified data foundation across NIH and CMS.
    • The combination of stronger federal bookings, including the new HHS project, and clearer operational goals for returning to growth and cash generation has sharpened investor focus on C3.ai’s government-driven pipeline and execution risks.
    • Next, we’ll explore how the HHS win and surging federal bookings might reshape C3.ai’s investment narrative around growth and profitability.

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    C3.ai Investment Narrative Recap

    To own C3.ai, you need to believe its agentic AI platform can become a go to choice for complex, regulated enterprises while the company reins in losses. The HHS win supports the near term bookings and federal growth catalyst, but Q2’s wider loss and ongoing revenue declines keep execution risk and the path to cash generation front and center.

    The HHS contract is especially relevant because it reinforces C3.ai’s push into government workloads that demand strict privacy, governance, and large scale data integration, exactly where its platform positioning is strongest. That said, the latest guidance for full year fiscal 2026, which still points to lower revenue than last year, underlines how much work remains to translate bookings momentum into sustainable top line growth.

    Yet behind the government contract headlines, investors should be aware that persistent operating losses and negative free cash flow still leave C3.ai exposed to...

    Read the full narrative on C3.ai (it's free!)

    C3.ai's narrative projects $613.6 million revenue and $80.3 million earnings by 2028.

    Uncover how C3.ai's forecasts yield a $14.67 fair value, a 3% downside to its current price.

    Exploring Other Perspectives

    AI Community Fair Values as at Dec 2025
    AI Community Fair Values as at Dec 2025

    Fifteen members of the Simply Wall St Community value C3.ai between US$13 and US$40.29, showing very different expectations for what the business could be worth. When you set those views against declining revenue and ongoing losses, it becomes clear why many market participants are focusing closely on execution risk and the timeline to any potential cash generation.

    Explore 15 other fair value estimates on C3.ai - why the stock might be worth over 2x more than the current price!

    Build Your Own C3.ai Narrative

    Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

    • A great starting point for your C3.ai research is our analysis highlighting 2 important warning signs that could impact your investment decision.
    • Our free C3.ai research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate C3.ai's overall financial health at a glance.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.