Summary
UiPath reported FY2027 second-quarter revenue of $410.3 million, up 13.4% from the prior-year quarter. Year-to-date revenue reached $828.6 million, up 15.4%. Gross profit was $329.7 million for the quarter, up 10.9%, and $671.1 million for the year to date, up 13.7%. The top line grew across all geographic regions, according to the 10-Q, with existing customers driving 72% of the quarterly growth and new customers contributing 28%. That mix matters because UiPath is trying to expand within large accounts while still adding logos.
Profitability improved sharply on a GAAP basis. Operating income was $31.6 million in the quarter, swinging from a prior-year operating loss. Year-to-date operating income was $59.6 million, also swinging from a prior-year loss. Net income was $36.1 million for the quarter, up year over year, and $58.6 million for the year to date, swinging from a prior-year loss. Diluted EPS was $0.07 in the quarter, up year over year, and $0.11 for the year to date, up from a prior-year loss. Operating margin was 7.7% in the quarter, up 13.3 percentage points, and 7.2% year to date, up 12.3 percentage points. The margin story is not uniform. Gross margin was 80.4% in the quarter, down 1.8 percentage points, and 81.0% year to date, down 1.2 percentage points. Management attributed the decline to a lower proportion of higher-margin licenses revenue and higher cost of professional services and other revenue, including third-party subcontractor costs. Operating expense discipline, especially lower stock-based compensation in research and development and sales and marketing, helped offset that pressure.
ARR was $1.938 billion as of July 31, 2026, up 12% year over year. Net new ARR was $37 million. Dollar-based net retention rate was 109%. Customers with ARR of at least $1 million rose to 387 from 320, and customers with ARR of at least $100,000 rose to 2,666 from 2,432. Cash, cash equivalents, and marketable securities were $1.405 billion as of July 31, 2026. Deferred revenue was $543.6 million, up 7.2% from the prior-year quarter, and remaining performance obligations were $1.38 billion, up 14.0%. Those figures point to a large base of committed business, even as the company works to convert that backlog into revenue.
Management issued guidance for the third quarter of fiscal 2027 and the full fiscal year 2027. For the next quarter, UiPath expects revenue of $440 million to $445 million, ARR of $1.992 billion to $1.997 billion as of October 31, 2026, and non-GAAP operating income of approximately $100 million. For the full fiscal year, the company expects revenue of $1.789 billion to $1.794 billion, ARR of $2.065 billion to $2.070 billion as of January 31, 2027, and non-GAAP operating income of approximately $445 million. The full-year targets are for fiscal year 2027, not the current quarter. The company does not reconcile forward-looking non-GAAP operating income to GAAP because of the variability of stock-based compensation and related charges, a point it repeated in the press release.
Cash flow was mixed. GAAP operating cash flow was $30.7 million in the quarter, down 26.2% from the prior-year quarter, while year-to-date operating cash flow was $162.6 million, up 1.3%. Capital expenditures were $1.39 million in the quarter, up year over year, and $4.07 million year to date, down 68.3%. The company reported non-GAAP adjusted free cash flow of $31 million for the quarter. Non-GAAP operating income was $89 million in the quarter, and non-GAAP gross margin was 82%. Those non-GAAP measures exclude stock-based compensation, amortization of acquired intangibles, employer payroll taxes related to equity transactions, restructuring costs, charitable donations of stock, and changes in contingent consideration.
Beyond the numbers, UiPath announced leadership changes. Hitesh Ramani was promoted to CFO, Ashim Gupta will continue as COO, and Brad Brubaker was named Chief Legal Administrative Officer. The company also appointed Yazdi Bagli to its board. Product news included Maestro Case for case management and Maestro Flow for developer-first orchestration. Risks remain. The 10-Q cites macroeconomic uncertainty, geopolitical shifts, foreign currency fluctuations, and interest rate sensitivity. Gross margin faces pressure as more business shifts to SaaS and as professional services rely on third-party subcontractors. Competition, rapid AI change, reliance on third-party cloud and large language model providers, and execution of the leadership transition are also watch items.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2027 | Q1 FY2027 | QoQ | Q2 FY2026 | YoY |
|---|---|---|---|---|---|
| Revenue | $410.3M | $418.4M | -1.9% | $361.7M | +13.4% |
| Gross profit | $329.7M | $341.5M | -3.5% | $297.3M | +10.9% |
| Gross margin | 80.4% | 81.6% | -1.3 pp | 82.2% | -1.8 pp |
| Research & development | $83.4M | $92.9M | -10.2% | $98.3M | -15.2% |
| Sales & marketing | $164.6M | $167.9M | -1.9% | $166.3M | -1.0% |
| General & administrative | $50.1M | $52.7M | -5.0% | $52.9M | -5.3% |
| Total operating expenses | $298.1M | $313.5M | -4.9% | $317.5M | -6.1% |
| Operating income (loss) | $31.6M | $28.0M | +12.9% | -$20.2M | +256.6% |
| Operating margin | 7.7% | 6.7% | +1.0 pp | -5.6% | +13.3 pp |
| Net income (loss) | $36.1M | $22.5M | +60.2% | $1.6M | +2178.3% |
| Net margin | 8.8% | 5.4% | +3.4 pp | 0.4% | +8.4 pp |
| Diluted EPS | $0.07 | $0.04 | +$0.03 | $0.00 | +$0.07 |
| Customers | 172,796 | 184,953 | -6.6% | 242,701 | -28.8% |
Risks
Gross margin decreased to 80% for the quarter ended July 31, 2026 from 82% in the prior-year quarter, and to 81% year to date from 82%, driven by a lower proportion of higher-margin licenses revenue plus a $12.0 million increase in third-party subcontractor costs within cost of professional services. If professional services and cloud hosting costs keep rising faster than revenue, the company's profitability improvement could reverse.
The provision for income taxes increased by $15.0 million in the quarter and $30.6 million year to date, driven by higher U.S. income tax expense following the release of full valuation allowances on U.S. Federal and certain U.S. state deferred tax assets during fiscal year 2026. The company also notes U.S. state and Romania valuation allowances could be released in fiscal 2027 through 2029, making the effective tax rate and comparability of results volatile.
The WorkFusion acquisition consumed a net $149.4 million of cash in the six months ended July 31, 2026, added intangible amortization (total amortization of acquired intangibles up to $10.6 million year to date from $3.7 million), and carries $30.4 million of short-term contingent consideration at fair value. G&A also absorbed a $3.3 million year-to-date increase in fair value of contingent consideration liability, and future cash payments under acquisition-related arrangements are described as potentially material.
MD&A highlights geopolitical relationships, fluctuating inflation and interest rates, monetary and trade policy changes, government efficiency initiatives, and foreign currency volatility as disrupting customers, prospects, and partners. Related effects are visible in interest income, which decreased 10% in the quarter and 14% year to date, and in cash, cash equivalents, restricted cash and marketable securities falling to $1,406.5 million as of July 31, 2026 from $1,689.9 million as of January 31, 2026.
Large accounts drive a disproportionate share of revenue: customers with ARR of $1 million or more totaled 387 at July 31, 2026 (up from 320) and represented 50% of current period revenue. The dollar-based net retention rate of 109% depends on expansion within this narrow cohort, so non-renewals or downsells at a few large customers could materially affect ARR and revenue.
The expense reductions supporting the swing to operating income of $31.6 million in the quarter lean heavily on lower stock-based compensation, which fell to $45.0 million in the quarter from $78.0 million a year earlier, alongside a $14.9 million (15%) decline in research and development spend. A return to higher SBC or R&D investment levels would pressure the newly positive operating margin of 7.7% for the quarter.
SaaS KPIs
All quarters →Dollar-Based Net Retention Rate
Net New ARR
Non-GAAP Adjusted Free Cash Flow
Non-GAAP Gross Margin
Non-GAAP Operating Margin
Non-GAAP Operating Income
Summary, forecast, risks and KPIs are extracted from UiPath, Inc.'s SEC filings for Q2 FY2027 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.