C3 AI Flirts With a Sale. Who Bites, And Why Now?
Enterprise AI vendor C3 AI is reportedly weighing its options after founder Thomas Siebel stepped aside as chief executive due to health issues. A sale is on the table, alongside the more familiar Plan B of fresh private capital.
On paper, you can see the pitch. C3 sells an application platform used by Shell, the US Air Force and manufacturers, positioning itself as a smaller, more configurable rival to Palantir. In practice, the numbers drain some of the gloss.
Market value sits around US$2.15 billion. The shares are down 54% year to date. First-quarter revenue fell 19% to US$70.3 million, while the net loss widened to US$116.8 million. Management also withdrew full-year guidance, citing the leadership transition and a sales and services shake-up.
New boss Stephen Ehikian arrived on 1 September with a Salesforce pedigree, and Siebel moved to executive chairman after disclosing an autoimmune condition that caused significant visual impairment. A heavyweight board lines the hallway, but boards do not close enterprise deals.
Who would buy this business? A defence prime could like the government footprint, but export controls, data residency and clearance issues complicate integration.
A hyperscaler might prefer to sell its own AI stack rather than inherit someone else’s. Private equity can do the maths on cost take-out and contracted revenue, yet paying a premium for shrinking sales and heavy losses feels brave in 2025.
Valuation is the crux. Annualising that quarter puts revenue near US$280 million, but it is falling. At roughly US$2.15 billion, investors are already paying a chunky multiple for a company that pulled guidance.
Any buyer would need high confidence that churn can be tamed, the pipeline is real, and gross margins withstand the shift from splashy “AI” pilots to dull, durable production.
C3 still has assets that matter: reference customers, a library of domain apps, and muscle memory for regulated sectors.
The question is whether those assets fetch a take-out price that rewards today’s holders, or whether the best outcome is a hard reset under new ownership with less buzz and more discipline.
