Since going public last year, C3.ai (AI -2.70%) stock has been a losing investment, down over 80%. However, it's not as though the business is struggling. In fact, some parts of the business are doing quite well. And there's reason to believe the company still has potential.

In this video from Motley Fool Backstage Pass, recorded on Dec. 6, Fool contributor Jason Hall lays out the bull case for C3.ai stock to fellow contributors Danny Vena and Jon Quast. The vast majority of C3.ai's customers have only signed small contracts. But if C3.ai's artificial-intelligence software proves valuable, it's reasonable to assume they'll increase their spending significantly in time.

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Danny Vena: Just to go back to the remaining performance obligation for a minute. When the company signed these contracts, they know that they're going to have this amount of revenue going into the future and that's what gets added into their remaining performance obligation. This contract with Baker Hughes went from, I think it was $45 million to $495 million. Basically up about 10- or 11-fold. But then when you back that contract out of their RPO, their RPO actually went down by 16%, which means they were focused solely on the Baker Hughes contract in this quarter and maybe their sales force wasn't going out and pursuing other opportunities. I don't want to say that it was a bad choice on their part. But investors looked at that and said, "Oh, no. They got this big win, but it was at the expense of everything else."

Jason Hall: The other thing there, it's not even just maybe whatever their sales operation is or isn't doing. Customers aren't coming to them and asking, either. [laughs] Either way there's a detachment beyond the great success of Baker Hughes and the potential value of its business for apparently just about everybody else. [laughs]

Vena: Now, Jason and just so investors know and our viewers know, you own C3.ai stock?

Hall: I did. I actually bought it very close to the IPO, just an initial buy. It has not done well. Honestly, I have no intention of selling because I believe in their products. I believe in what they're doing. Again, I think the crux of it is unlike what we're about to hear with Snowflake when you look at so many of their metrics, then you think about those SaaS companies in cybersecurity where there's a clear return on the investments where more companies are coming to do business with these companies and they're paying more money every single year for more and more things. I think the business world is still trying to figure out AI.

Jon, did you have something to add?

Jon Quast: Yes, I have a question as somebody who has never researched C3.ai. [laughs] I don't know how big of a business Baker Hughes is. But to me, when you are signing up that many customers, that's not nothing. That is potentially a huge tailwind if you can prove what your software brings to the table. You may not prove that this quarter or right now, but you can prove that over the next year or whatever that small nibble of a contract is. If you do prove that you have this enormous backlog of potential upgrades that you can make. Is that the bull case here?

Hall: Yeah, 100%. This is enterprise AI software. This is what they do. Like I said, I think what it really boils down to, that's why it's growing customers. But those customers aren't signing long-term subscriptions. [laughs] They're doing one-off things. That's the key right there is all it takes is the next Baker Hughes and then the one after that and the one after that and the one after that, then the story completely changes. Jon, that's 100% why I'm not even close to considering selling right now because clearly there is value there, it's just the market is still trying to figure out what the company is worth. Until they can demonstrate that there are more customers that want to make those long-term commitments to this enterprise AI software from this company, we don't know yet.

That's why I'm not adding at this point either because I also want more evidence that it's widely valuable and scalable for other businesses in multiple industries, too. We're just talking about the oil and gas industry with Baker Hughes. They're a big data company in oil and gas. They're a big services provider, but they have massive amounts of data about the industry. It makes sense for them. I'm curious to see companies in other industries that also have large amounts of data that maybe also don't have some a tech edge where they're building their own AI tools. You know what I mean? That's what we don't know. Is this viable as a stand-alone business when there are so many data-heavy companies that have the resources to build their own AI tools?