The stock of C3.ai, Inc. (AI), which has been riding the hype surrounding generative artificial intelligence after ChatGPT, the artificial intelligence chatbot launched by Open AI late in November 2022, took the world by storm to become the fastest-growing application in history.
That unraveled recently when short-seller Kerrisdale Capital sent a letter to Deloitte & Touche LLP, the auditor of AI, detailing serious accounting irregularities that raise red flags for investors. The company has been accused of numerous dishonest accounting practices, such as inflating gross profit margins by shifting expenses to different categories. Right on cue, the stock crashed 26% on Tuesday.
