C3.ai Stock Rises Despite Microsoft-OpenAI Deal Sparking AI Competition Fears
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OpenAI CEO Sam Altman was unexpectedly pushed out by the board, then quickly hired by Microsoft to lead a new AI unit. This scared investors in other AI companies like C3.ai.
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C3.ai stock closed nearly 2% higher on Tuesday after receiving an analyst recommendation upgrade from Oppenheimer's Tim Horan.
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Horan believes C3.ai will post 23% year-over-year revenue growth in 2024 Q2. However, C3.ai remains deeply unprofitable.
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With Altman and potentially hundreds of OpenAI employees, Microsoft is poised to become an AI powerhouse and could compete with smaller AI firms.
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Until C3.ai can reliably book profits, upside for its stock will likely remain limited despite the high growth potential in the AI industry.