UiPath shares experienced a significant increase in late trading on Thursday after the enterprise automation software company announced its financial results for the October quarter. The stock price rose by 11.4% to reach $22.15.
During the fiscal third quarter, UiPath achieved a revenue of $326 million, marking a 24% increase compared to the previous year. This exceeded both the company’s own guidance range of $313 million to $318 million and the Street consensus estimate of $316 million, as tracked by FactSet.
Adjusted profits for the quarter were at 12 cents per share, surpassing the consensus estimate of 7 cents. However, under generally accepted accounting principles, the company reported a loss of 6 cents per share.
UiPath’s annualized recurring revenue also saw a notable growth, reaching $1.378 billion, a 24% increase from the previous year. This result exceeded the company’s forecast range of $1.359 billion to $1.364 billion.
Moving forward, for the fiscal fourth quarter ending in January, UiPath expects revenue to be between $381 million and $386 million, aligning with the Street consensus estimate of $383 million. The company also foresees annualized recurring revenue to reach between $1.45 billion and $1.455 billion, slightly exceeding the consensus estimate of $1.43 billion. Furthermore, UiPath projected non-GAAP operating income for the quarter to be $78 million, in line with Street estimates.
UiPath has been leveraging artificial intelligence and machine learning as part of its core business for more than five years. The company’s software aids in automating various business processes. Ashim Gupta, CFO of UiPath, highlights that the company utilizes existing large language models along with developing its own targeted AI software to assist customers in simplifying complex processes. Gupta also mentions that UiPath has a strong presence in the healthcare and financial services sectors, having achieved a record quarter in its federal business.
When asked about the potential impact of macroeconomic issues on the business, Gupta expressed confidence as he stated that customers continue to invest where there is a visible return on investment. He emphasized that UiPath’s value proposition is both tangible and quantifiable.