UiPath, an automation software company listed on NYSE with the ticker PATH, exceeded the expectations of analysts in its Q1 results for FY2024. The company’s revenue increased 18.2% YoY to $289.6 million. However, its revenue guidance for the next quarter, estimated at around $281.5 million, was slightly below market expectations, leading to an 11.3% drop in the stock price. Despite this, UiPath’s GAAP loss of $31.9 million for the quarter was an improvement on its loss of $122.6 million from the same quarter in the previous year.
For a comprehensive analysis of UiPath’s latest earnings, access the full report here for free.
UiPath (PATH) Q1 FY2024 Highlights:
- Revenue: $289.6 million vs analyst estimates of $271.2 million (6.76% beat)
- EPS (non-GAAP): $0.11 vs analyst estimates of $0.02 ($0.09 beat)
- Revenue guidance for Q2 2024: $281.5 million at a midpoint, below analyst estimates of $284.3 million
- Full-year revenue guidance: raised from $1.26 billion to $1.27 billion at midpoint, indicating a 1.12% increase
- Free cash flow: $65.5 million, a 28.6% decrease from the last quarter
- Gross Margin (GAAP): 84.9%, up from 81.7% from the same quarter last year
According to UiPath Co-CEO Rob Enslin, these results show the company’s focus on driving growth and profitability at scale, leading to an increase in operating margin and cash flow for the second consecutive quarter. Founded in Romania in 2005 as a tech outsourcing company, UiPath specializes in software that helps businesses automate repetitive computer tasks.
As automation software becomes increasingly advanced, featuring AI and machine learning, the demand for modern automation software is surging. UiPath has shown strong revenue growth, increasing by $103.4 million over the past two years, from $186.2 million in Q1 FY2022 to $289.6 million in Q1 FY2024. However, its sales seem to follow a seasonal pattern, and the company expects a revenue drop in the next quarter following these results.
UiPath’s guidance suggests a 16.2% YoY growth in revenue for the next quarter, amounting to $281.5 million, but this is comparatively lower than the 23.9% YoY increase in the same quarter last year. The company’s sales growth forecast for the next twelve months is estimated to be 18.8%. Our platform offers a free analysis of UiPath’s growth potential.
UiPath’s gross profit margin was 84.9% in Q1 FY2024, a vital indicator of how much money is left from revenues after covering necessary expenses to pay for servers, licenses, technical support, and administrative overheads. A high profit margin allows UiPath to invest in product and sales during growth periods while maintaining profitability at maturity.
UiPath’s positive free cash flow over the last twelve months, amounting to $1.78 billion in cash, confirms its ability to pursue a high-growth business strategy. Although the company exceeded analyst expectations for revenue this quarter, mixed guidance for the upcoming quarter led to a market response. As the company’s guidance for the full year exceeded market expectations and its cash flow turned positive YoY, this earnings report presents UiPath’s mixed quarter.
For an in-depth analysis of UiPath’s valuation and business qualities, as well as updated information on the latest quarter, access our free actionable report here.
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The author has no position in any of the stocks mentioned.