UiPath, Inc. Q1 FY2027 earnings

UiPath reported revenue of $418.4 million for the first quarter of fiscal 2027, up 17.3% from $356.6 million in the prior-year quarter. Gross profit rose 16.6% to $341.5 million from $292.8 million. The bigger change came lower down the income statement. GAAP operating income was $28.0 million against an operating loss of $16.4 million a year earlier. Net income was $22.5 million against a net loss of $22.6 million. Diluted earnings per share was $0.04 against a loss of $0.04 per share. Management called it the company's first quarter of GAAP profitability in its history and credited operating discipline across the business rather than a one-time item.

GAAP gross margin was 81.6%, down 0.5 percentage points from 82.1%. Operating margin swung to 6.7% from negative 4.6%. On a non-GAAP basis, gross margin was 83%, down from 84%, while non-GAAP operating income was $92.5 million against $69.6 million and non-GAAP operating margin was 22% against 20%. Cost of revenue grew faster than revenue, driven by higher third-party subcontractor costs in professional services and higher hosting and software services costs in subscription services. Expense discipline covered the rest. Sales and marketing expense rose, research and development and general and administrative expense both declined, and stock-based compensation expense fell year over year. The company strips stock-based compensation, amortization of acquired intangibles, employer payroll taxes tied to equity transactions and restructuring costs out of its non-GAAP measures.

ARR reached $1,901.2 million at April 30, 2026, up 12% from $1,692.7 million a year earlier. Net new ARR was $49 million, and the dollar-based net retention rate was 109% against 108%. Large customers carried the mix. There were 374 customers with ARR of at least $1 million versus 316, and they accounted for 52% of current period revenue against 47%. Customers with ARR of at least $100,000 numbered 2,624 against 2,365, and they accounted for 87% of current period revenue in both periods. About 30% of the ARR growth rate came from new customers and 70% from existing ones. Remaining performance obligations were $1.41 billion, up 14.8%, and the current portion of deferred revenue was $572.1 million, up 7.8%.

Cash generation held up. Operating cash flow was $131.9 million, up 10.9% from $119.0 million. Capital expenditures were $2.7 million, down 79.1% from $12.8 million. Non-GAAP adjusted free cash flow, which the company calculates by adjusting operating cash flow for equipment purchases, employer payroll taxes on equity transactions and related items, was $130.3 million against $117.1 million. Cash, cash equivalents and marketable securities were $1.42 billion at April 30, 2026. The company also repurchased Class A common stock, spending $243.8 million, and in March 2026 the board authorized a new $500 million repurchase program after the earlier authorizations were fully used.

Guidance puts second-quarter fiscal 2027 ARR at $1.929 billion to $1.934 billion as of July 31, 2026 and non-GAAP operating income at about $75 million. For the full fiscal year 2027, the company guides to ARR of $2.058 billion to $2.063 billion as of January 31, 2027 and non-GAAP operating income of about $430 million. Revenue guidance is also given in ranges for both the second quarter and the full fiscal year. The company states that a reconciliation of non-GAAP operating income guidance to the comparable GAAP measure is not available without unreasonable efforts, because the excluded charges, particularly stock-based compensation, are hard to predict.

The risk list stays long. Macroeconomic shocks, changes in trade and monetary policy, interest rate swings and foreign currency moves can shift demand and muddy period comparisons. The platform depends on third-party cloud infrastructure and large language models, and it competes both with existing vendors and with new, potentially disruptive technologies. Taxes are another swing factor. The provision for income taxes rose, driven by increased U.S. income tax expense after full valuation allowances on U.S. federal and certain state deferred tax assets were released during fiscal 2026. Management sees a reasonable possibility of releasing the remaining U.S. state valuation allowance during fiscal 2027 and the Romania allowance, or a portion of it, during fiscal 2028, which would book a tax benefit in the period of release.