AI giant C3.ai suffered massive employee layoffs and its stock price fell sharply

It was reported that artificial intelligence (AI) software company C3.ai made layoffs last week due to poor performance of some employees and the company's need to reduce costs

The media quoted people familiar with the situation on Monday (November 21) as saying that employees in various departments of the company were laid off. Last Thursday (November 16), an executive pointed out at a meeting attended by hundreds of employees that C3.ai needs to reduce costs.

According to reports, The management’s decision to lay off workers is related to employees’ personal performance. It is dismissal rather than layoffs. Many fired employees only received one month’s severance pay.

The situation regarding the number of employees affected is currently unclear. However, a person familiar with the matter revealed that C3.ai conducted similar layoffs about six months ago, which was also based on employee performance management reasons

As of April 30, the software company had 914 full-time employees, 746 of whom were in the United States and 168 in other countries, according to a regulatory filing.

Share price fluctuates

Since the beginning of this year, driven by the wave of generative artificial intelligence, C3.ai’s stock price has more than doubled

The company has been providing artificial intelligence services to enterprise customers for more than ten years and this year launched the C3 generative artificial intelligence product suite

According to reports, this product suite integrates the latest AI functions and the most advanced models from OpenAI, Google and academia. The first product, C3 Generative AI for Enterprise Search, can quickly locate, retrieve and present all relevant data in the entire corpus of the enterprise information system, providing enterprise users with a transformative user experience.

However, as soon as the layoff news was made public on Monday, the company’s stock price fell off a cliff , falling below $30. Not only did it wipe out all the gains during the day, but the stock price once fell to $27.34, a drop of 6.7 %, and the decline narrowed to 4.35% at the close.

A spokesperson for C3.ai later said in a statement that the company continues to recruit and fill open positions to advance the company's strategic areas.

In C3.ai's annual forecast, they expect operating losses to hit $100 million this September, a third higher than previous guidance. Previous expectations were for a full-year operating loss of between $50 million and $75 million. C3.ai explained that they hope to further invest in areas that can generate artificial intelligence products

Rewritten content: Quoted from: Financial Associated Press

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