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C3.ai Inc., the artificial intelligence software provider led by tech billionaire Tom Siebel, has raised a higher-than-expected $651 million in its initial public offering after selling 15.5 million shares at $42 apiece.

The company started trading today on New York Stock Exchange under the ticker symbol “AI,” and shares immediately jumped to $100 a share on the opening, up 138% over the opening price. As a result, C3.ai, which was poised to kick off its first day as a public firm with a market capitalization of more than $4 billion, is now worth more than $10 billion. Shares closed the first day of trading at $92.49 apiece, up 120%.

That’s a big win not only for the company but also for its underwriters. The financial institutions that underwrote the offering have the option to buy an additional 2.325 million shares at the IPO price in the next 30 days.

It’s another indication that despite the pandemic-hobbled economy, IPOs remain red-hot right now. Public investors are also holding high expectations for DoorDash Inc., which went public this week as well. The food delivery giant on Tuesday raised a massive $3.37 billion through its IPO by selling 33 million shares at $102 apiece, well above the original target range of $90 to $95.

This morning the shares opened a stunning $182 a share, more than 75% above the median target price. By day’s end, shares had closed up 85% from the offering price, to $189.51 a share, giving DoorDash more than a $60 billion valuation.

Airbnb Inc., whose IPO later today is also expected to be one of the year’s largest for the consumer tech sector, is hoping to replicate DoorDash’s success. The Wall Street Journal reported today that Airbnb is aiming to sell its shares at above the target range of between $56 and $60 that it had set just earlier this week. According to the Journal’s sources, the increased price could give the home rental unicorn a market capitalization north of $42 billion.

Redwood City, California-based C3.ai competes in two parts of the enterprise AI software market. It sells a collection of use case-specific machine learning applications for performing tasks such as monitoring the health of manufacturing equipment. Additionally, C3.ai provides development tools that enterprises can use to build their own custom AI applications.

The company’s suite of development tools includes a low-code model creation platform that engineers can use to build neural networks in a relatively short time. C3.ai also offers products that ease the various tasks involved in turning a newly created machine learning model into a scalable application capable of crunching large data volumes.

The company’s customer base includes large organizations such as the U.S. Air Force, New York utility Consolidated Edison Inc. and numerous Fortune 500 firms. Those customers drove revenues of $81.8 million for C3.ai in the six months ended Oct. 31, a 11% increase from a year earlier. The company managed to cut losses by nearly half in the same period, to $14.8 million from $29.1 million before. 

“You can expect us to operate a highly disciplined, professional business that is engineered to become structurally profitable and structurally cash-positive in the long term,” C3.ai Chief Executive Officer Tom Siebel (pictured) wrote in a letter to prospective investors attached to the company’s IPO filing. C3.ai’s message, judging by its IPO funding haul, has found a receptive audience on Wall Street.

Photo: SiliconANGLE