C3.ai (NYSE:AI) investors are awaiting earnings results due May 31, as the generative artificial intelligence (AI) boom continues.

Since reporting a quarterly loss of $63 million, or 57 cents per share, on revenue of $66.6 million on March 2, AI stock is up 58%. The company recently said it will have slightly higher revenue for the latest quarter. It expects revenue of $72 million and a loss between $76 million and $77 million.

AI shares jumped 16% on May 26 and were up another 10% over the weekend. At the time of writing, it is due to open on May 30 at over $36 per share, representing a market capitalization of nearly $4 billion.

AI Stock and AI Mania

Generative AI, which can output text, art, music or code, is built on enormous machine-learning databases. It has quickly become the hottest business story of 2023. AI stock is in the middle of it.

C3.ai’s results have nothing to do with the stock’s volatility. That’s the product of its market niche, generative AI models now available on Alphabet’s (NASDAQ:GOOG, NASDAQ:GOOGL) Google Cloud.

The stock has been on fire since Nvidia (NASDAQ:NVDA) reported its earnings, but the company’s own results haven’t yet justified the hype. A Bloomberg report criticizing product delays and accusing founder Thomas Siebel of micromanagement didn’t dent the stock’s momentum.

AI stock has now regained heights achieved in April before a short-seller report from Kerrisdale Capital cut its price in half over the course of a month.

Speculators are ignoring the fact that January revenue was down from a year ago, that April revenue will only be 12% higher, and that C3.AI is losing more money than its revenue. Speculators are bidding up anything with an AI link, as they previously bid up pot stocks, cryptocurrency and special purpose acquisition companies (SPACs).

Chip company Marvell Technologies (NASDAQ:MRVL) jumped 32% after just suggesting AI would be a driver of future earnings. Palantir Technologies (NASDAQ:PLTR), which sells systems it calls AI to government and large enterprises, is up almost 15% since the start of trading on May 26.

What Happens Next

There’s reality behind the AI boom, but there’s also an air of irrationality among AI stocks.

On the date of publication, Dana Blankenhorn held long positions in GOOGL and NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.