UiPath, Inc. Q3 FY2025 earnings call

• Third-quarter results exceeded the high end of guidance across key financial metrics. ARR was $1.607 billion, up 17% with net new ARR of $56 million. Revenue was $355 million and non-GAAP operating income was $50 million.
• Unveiled vision and roadmap for agentic automation at FORWARD user conference, with Agent Builder starting private preview and over 1,000 organizations signed up. AI agents will be first-class citizens on the platform, working across applications with security and governance.
• Partnership with SAP: Platform integrated into SAP Build Process Automation solution, helping win new logos and expand existing customers, such as a leading data storage company and a large US oil and gas company.
• Customer examples: Volkswagen Financial Services standardizing on UiPath platform for IDP products, Protiviti expanding usage of technology including Autopilot, Hebron using Test Suite for test case creation.

Third-quarter revenue was $355 million. ARR ended the quarter at $1.607 billion, an increase of 17% driven by net new ARR of $56 million. Non-GAAP operating income was $50 million. Gross margin for the third quarter was 85% and software gross margin was 89%.

• Fourth-quarter fiscal 2025 revenue expected in the range of $422 million to $427 million, ARR in the range of $1.669 billion to $1.674 billion, non-GAAP operating income approximately $100 million. Basic share count expected to be ~551 million shares.
• Fiscal 2026 guidance to be provided when reporting fourth quarter results, with expectation of stabilized net new ARR and accelerated adjusted free cash flow.

Actual results may differ materially from forward-looking statements due to many factors. For a discussion of material risks and uncertainties, refer to UiPath's annual report on Form 10-K for the year ended January 31, 2024, and subsequent SEC filings.

Q: As we look at agentic models from other companies, can UiPath benefit from third-party agents commanding and controlling other applications?

A: UiPath focuses on creating an agentic orchestration layer that can call its own agents, other companies' agents, robots, and bring humans in the loop for security and governance.

Q: What's enabling the strong growth in maintenance and support revenue?

A: It's the benefit of cumulative net-new ARR building and recovery of duration from earlier this year, with largest customers extending contracts.

Q: How confident are you about net new ARR stabilizing next year?

A: Pleased with execution progress, momentum from agentic initiatives, and improved sales pipeline management and visibility, feeling confident in the business's progress.

Q: How is UiPath thinking about the US government market opportunity?

A: There's great opportunity, with positive energy internally and seeing good momentum, especially in improving government efficiency.