UiPath Inc.’s stock endured a wild swing after the company posted second-quarter revenue that beat analyst expectations.
The stock initially popped more than 10% right after the company reported, only to reverse course later. At the time of writing, the shares were down more than 7%.
The company reported earnings before certain costs such as stock compensation of 15 cents per share, matching Wall Street’s target. Revenue for the period rose 13%, to $410 million, well ahead of the $397.8 million analyst target. UiPath strengthened its bottom line, too. It reported net income of $36.1 million at the end of the quarter, up from a minuscule profit of just $1.6 million one year earlier.
Investors were likely encouraged by the company’s decision to raise its full-year outlook for fiscal 2027. It bumped up its revenue forecast from an earlier range of $1.776 billion to $1.781 billion to a new range of between $1.789 billion and $1.794 billion.
UiPath’s stock has gained more than 70% over the last year, but in recent months it has struggled to maintain that momentum. It’s up just 12% in the year to date on concerns that artificial intelligence models may disrupt the company and eat away at its customer base. But UiPath contends that AI will actually increase demand for its robotic process automation technology, which follows rigid, predetermined rules to automate certain business tasks.
The company has also upped its game by trying to develop more intelligent, agentic automations. It has released a series of AI agents that can reason, adapt and work autonomously, without needing to follow the same rigid rules and without human supervision. Its push into this area is meant to reassure investors that it can actually participate in the AI boom, and not just sit on the sidelines and slide into obscurity.
Founder and Chief Executive Daniel Dines (pictured) said AI is expanding the possibilities for what enterprises can automate while also increasing the need for the orchestration, governance and exactness that the company’s traditional deterministic automation provides. “Our ability to bring AI agents, robots, systems and people together to execute end-to-end business processes positions UiPath at the center of this opportunity,” he said. “We have spent the past two years transforming our platform and strengthening our execution.”
There were a few signs that this effort is beginning to pay off. UiPath’s annual recurring revenue reached $1.94 billion, up 12% from where it was one year ago, while its dollar-based net retention rate increased to 109%, which means that those customers are spending more on its tools. These metrics are important because they underpin the durability of the company’s revenue base and reduce its reliance on getting new customers to keep growing.
For the current quarter, UiPath is targeting revenue of between $440 million and $445 million. The midpoint of that range came in above the Street’s guidance of $441.2 million. The company also announced a number of executive changes across its sales and delivery teams, including the promotion of its Chief Accounting Officer Hitesh Ramani, who is now chief financial officer instead. Dines framed the changes as an attempt to sharpen the executive team’s speed and accountability.
