Today witnessed a fortunate surge of approximately 13% for C3.ai's stock.
Today witnessed a fortunate surge of approximately 13% for C3.ai's stock.
C3.ai's (AI 3.16%) shares took off early Tuesday morning, increasing by 13.2% before 9:50 a.m. ET following the announcement of a "strategic partnership" with tech giant Microsoft.
Demonstrating each firm's unique strengths, specialist in artificial intelligence (AI) applications, C3.ai, and Azure-based AI server farm operator, Microsoft, have agreed to collaborate. Their objective is to improve existing capabilities and introduce innovative solutions that aid their shared customers in delivering top-notch enterprise AI solutions with Azure.
Let's delve deeper
To be more precise, Microsoft plans to incorporate C3.ai's enterprise AI application software into the Microsoft Commercial Cloud Portal, align C3's solutions with new Azure capabilities, and jointly promote and supply C3's offerings to clients.
Over time, Microsoft will be designated as the "preferred cloud provider" for C3 AI services. Similarly, C3.ai will serve as a "preferred AI application software provider" on Microsoft Azure.
It's important to emphasize that, given the disparity in size between smaller firms such as C3, with a market capitalization of $3.8 billion, and giants like Microsoft, whose market cap surpasses $3 trillion, Microsoft is poised to be "the" preferred provider for C3's offerings, but C3 is only looking to be "a" preferred provider for Microsoft.
Is this a sign to buy C3.ai stock?
While it might seem like a significant development, this partnership might just be a tad oversold by investors today. Ponder this: In the same statement that reveals this new partnership, C3.ai highlights that it has been in a strategic partnership with Microsoft for the past six years. Also, worth noting is that today's press release does not include any concrete numbers or predictions of new revenue or profits for C3 stemming from this new alliance. Last but not least, C3.ai, despite boasting an existing partnership with Microsoft, posted a loss of $280 million the previous year and is projected to continue incurring losses as far as analysts can forecast.
C3.ai remains a risky stock, and investing in it is not recommended.
This partnership between C3.ai and Microsoft is expected to enhance their collaboration, with Microsoft integrating C3.ai's enterprise AI application software into their Commercial Cloud Portal and aligning C3's solutions with new Azure capabilities. Investors looking to leverage this opportunity should consider the potential risks, as the company has reported significant losses in the past and is projected to continue doing so. In the realm of finance and money management, it's crucial to invest wisely, balancing potential rewards against potential losses.