Executive Summary
UiPath reported a solid Q3 FY2025 with pronounced progress on ARR growth and product momentum, driven by the ramp of agentic automation and expanding ecosystem partnerships. Revenue reached $355 million, and ARR stood at $1.607 billion, up 17% year over year, while non-GAAP operating income was $50 million. The quarter featured notable enterprise-scale deployments, a robust pipeline for agentic solutions, and SAP Build Process Automation integration that broadens UiPath’s addressable market. Despite a GAAP net loss of $10.7 million, UiPath generated positive adjusted free cash flow of $33 million and maintained a strong liquidity position, supported by a net cash balance and negligible debt.
Management signaled a strategic transition toward enterprise-grade agentic automation, with public previews and customer deployments accelerating. The company highlighted three differentiators—cross-application agent and robot interoperability, governance through agentic orchestration, and a low-code developer-friendly approach—to position UiPath as a universal controller of agents, robots, people, and models. Looking ahead, UiPath guided to a Q4 revenue of $422–$427 million and ARR of roughly $1.669–$1.674 billion, with non-GAAP operating income around $100 million, and signaled that net-new ARR growth should stabilize in fiscal 2026 with accelerated free cash flow growth. This outlook, coupled with a growing customer base and expanding use cases (IDP, Autopilot, testing, and governance), supports a constructive long-term investment thesis contingent on execution momentum and continued demand for automation in large enterprises.
Key Performance Indicators
QoQ: 233.33% | YoY:459.71%
Key Insights
Revenue: $355.0m, up 9% YoY; QoQ up ~12% (Q2 → Q3). Gross profit: $290.9m, gross margin 82.02%, YoY gross profit growth 5.39%, QoQ 15.01%. Operating income: -$43.4m, margin -12.27%; YoY improvement of about 22.3%, QoQ improvement ~58.0%. Net income: -$10.7m, diluted EPS $0.20. ARR: $1.607B, up 17% YoY with net-new ARR of $56m. Customers: ~10,790 total; >$100k ARR customers: 2,235; >$1m ARR customers: 302. Gross retention (DBGR): 97%; net retention: 113%. Non-GAAP operating income: $50m; ...
Financial Highlights
Revenue: $355.0m, up 9% YoY; QoQ up ~12% (Q2 → Q3). Gross profit: $290.9m, gross margin 82.02%, YoY gross profit growth 5.39%, QoQ 15.01%. Operating income: -$43.4m, margin -12.27%; YoY improvement of about 22.3%, QoQ improvement ~58.0%. Net income: -$10.7m, diluted EPS $0.20. ARR: $1.607B, up 17% YoY with net-new ARR of $56m. Customers: ~10,790 total; >$100k ARR customers: 2,235; >$1m ARR customers: 302. Gross retention (DBGR): 97%; net retention: 113%. Non-GAAP operating income: $50m; non-GAAP adjusted free cash flow: $33m. cash flow: Net cash provided by operating activities $28.1m; free cash flow $23.2m; cash and cash equivalents $773.6m; short-term investments $795.4m; total cash & investments ~$1.57B; net cash position aided by minimal debt. Remaining performance obligations (RPO): $1.128B; current RPO: $718m. Guidance for Q4: revenue $422–$427m; ARR $1.669–$1.674B; non-GAAP operating income ~$100m. For FY2026, management anticipates stabilized net-new ARR dollars and accelerated adjusted free cash flow growth via efficiency improvements and agentic expansion.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
354.65M |
8.82% |
12.14% |
| Gross Profit |
290.89M |
5.39% |
15.01% |
| Operating Income |
-43.36M |
22.31% |
58.04% |
| Net Income |
-10.66M |
66.21% |
87.62% |
| EPS |
0.20 |
459.71% |
233.33% |
Key Financial Ratios
operatingProfitMargin
-12.2%
operatingCashFlowPerShare
$0.05
freeCashFlowPerShare
$0.04
priceEarningsRatio
-163.26
Management Commentary
- Strategic shift to agentic automation dominates discussion, with a focus on cross-system orchestration and governance. Quote: Daniel Dines emphasized UiPath’s aim to be the “Switzerland of agents,” orchestrating both UiPath and third-party agents while maintaining governance and security. This underpins the company’s platform-agnostic automation strategy. (Theme: Strategy/Governance)
- SAP collaboration and partner ecosystem expansion highlighted as critical growth vectors. Quote: Ashim Gupta detailed the SAP SolEx integration, ongoing enablement with SAP, and partner-driven pipeline (EY, Sonic Automotive), underscoring a broader go-to-market to scale automation across SAP and non-SAP workloads. (Theme: Partnerships/Ecosystem)
- Customer wins and expansions reinforce value of end-to-end automation: Allianz Technology deployment of IDP and document understanding; Volkswagen Financial Services standardizing on UiPath cloud IDP; Allianz and other cases illustrating productivity gains and cost reductions. (Theme: Enterprise Adoption/Use Cases)
- FORWARD conference momentum and public previews (Agent Builder, agent orchestration) signal a robust product roadmap, with thousands of registrations and a multi-quarter rollout plan. (Theme: Product Roadmap)
- Management commentary on demand backdrop and budgeting: demand described as stable with no material deterioration; enterprise seasonality expected in ARR; pipeline commentary reinforced by customer conversations post-FORWARD. (Theme: Market Conditions)
Our third-quarter results exceeded the high end of our guidance across all key financial metrics, a testament to our improving execution and the compelling value that our AI-powered automation platform delivers to our customers.
— Daniel Dines
For fiscal 2026, we believe that net-new ARR dollars will stabilize and our adjusted free cash flow growth rate will accelerate.
— Ashim Gupta
Forward Guidance
- Q4 FY2025 guidance: Revenue $422–$427 million; ARR $1.669–$1.674 billion; Non-GAAP operating income ≈$100 million; basic shares ≈551 million. The company notes typical enterprise seasonality from Q4 to Q1 in net-new ARR.
- Fiscal 2026 outlook: Management believes net-new ARR dollars will stabilize and adjusted free cash flow growth will accelerate, reflecting ongoing efficiency initiatives and the expanding agentic automation roadmap. No explicit revenue target for FY2026 is provided in the call; the emphasis is on ARR stabilization, profitability improvement, and free cash flow acceleration, contingent on continued demand for agentic automation and SAP/channel partnerships.
- Assessment: The Q4 guidance is modestly above Q3 levels on a sequential basis, supported by a broad enterprise pipeline, a growing ARR base, and the ramp of agentic solutions. The 2026 guidance implies a shift toward profitability and cash generation, but execution risk remains tied to adoption rates of agentic capabilities, the pace of SAP ecosystem integration, and the ability to convert broad-based demand into durable ARR growth. Key factors investors should monitor include: ARR net-new trajectory, expansion in autopilot and testing, the SAP SolEx deal pipeline, and the success of Agent Builder/Orchestrator previews.