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“We delivered second quarter fiscal 2024 ARR growth of 25 percent while executing on our strategic initiatives and driving operational excellence across the company,” said Rob Enslin, UiPath Co-Chief Executive Officer. “I am energized by the excitement around our continuous investments in AI which are driving business outcomes for our customers. Looking to the second half of the year, momentum is building across the business as customers recognize the need for efficiency in the current operating environment and the long-term structural advantages of automation.”

UiPath, Inc. today announced that its Board of Directors has authorized the Company to repurchase up to an aggregate of $500 million of its Class A common stock in a manner deemed in the best interest of the Company and its stockholders, taking into account the economic cost and prevailing market conditions, including the relative trading prices and volumes of the Class A shares. The repurchases are expected to be executed from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases or privately negotiated transactions, including through Rule 10b5-1 trading plans and under Rule 10b-18 of the Securities Exchange Act of 1934, as amended. The

Reconciliation of non-GAAP operating income guidance to the most directly comparable GAAP measure is not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and low visibility with respect to the charges excluded from this non-GAAP measure; in particular, the effects of stock-based compensation expense specific to equity compensation awards that are directly impacted by unpredictable fluctuations in our stock price. We expect the variability of the above charges to have a significant, and potentially unpredictable, impact on our future GAAP financial results.

•Announced General Availability of Generative AI and Specialized AI Offerings: These latest AI-powered automation features accelerate customers’ ability to discover, automate, and operate automations at scale through Generative AI and Specialized AI, including the general availability of OpenAI and Azure OpenAI connectors with support for GPT-4. The Company also introduced support for the Falcon Large Language Model (LLM) via its Amazon SageMaker connector, and the preview of the Google Vertex connector with support for PaLM 2.

•Delivered New AI-powered Features and Developer Experiences to Accelerate Automation Across All Knowledge Work: New platform features include powerful developer tools that extend options for both citizen developers and professional developers to put automation into practice faster with enhanced low-code tools, solution accelerators, and automated testing. Also announced preview of Clipboard AI™, our advanced AI tool specifically for non-technical knowledge workers that takes the waste out of copy-and-paste tasks.

◦Named a Leader and the only Star Performer in the Everest Group Intelligent Document Processing (IDP) Products report. This report analyzes AI technologies such as computer vision, natural language processing (NLP), and machine/deep learning to classify and extract information from structured, semi-structured, and unstructured documents. Everest Group commented: “UiPath’s acquisition of Re-infer has helped it improve its NLP capabilities for context understanding and communications mining, further contributing to its success.”

•Announced Partnership with Peraton to Expand Cloud-based Automation in U.S. Intelligence, Defense, and Federal Civilian Sectors: Peraton, a leading mission capability integrator and transformative enterprise IT provider, is partnering with UiPath to deliver the UiPath Business Automation Platform as a cloud-based managed service to high-security environments within U.S. intelligence, defense, and civilian agencies. The partnership will allow federal government customers to create and execute on automation strategies, drive mission agility, and orchestrate transformational impact for highly sensitive secure workloads.

•Released its Fiscal Year 2023 Impact Report: In this report, UiPath highlights its environmental, social, and governance (ESG) approach and shares the Company’s first materiality assessment, identifying the most relevant areas of impact on stakeholders. In addition, for the first time, the report includes a comprehensive greenhouse gas inventory of data across Scopes 1, 2, and 3 and introduces a commitment by UiPath to set corporate climate targets, in alignment with the Science-Based Target Initiative.

UiPath will host a conference call today, Wednesday, September 6, 2023, at 5:00 p.m. Eastern Time, to discuss the Company's second quarter fiscal 2024 financial results and its guidance for the third quarter and full year fiscal 2024. To access this call, dial 1-201-689-8057 (domestic) or 1-877-407-8309 (international). The passcode is 13740527. A live webcast of this conference call will be available on the "Investor Relations" page of UiPath’s website (https://ir.uipath.com), and a replay will also be archived on the website for one year.

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UiPath (NYSE: PATH) is on a mission to uplevel knowledge work so more people can work more creatively, collaboratively, and strategically. The AI-powered UiPath Business Automation Platform combines the leading robotic process automation (RPA) solution with a full suite of capabilities to understand, automate, and operate end-to-end processes, offering unprecedented time-to-value. For organizations that need to evolve to survive and thrive through increasingly changing times, UiPath is The Foundation of Innovation™. For more information, visit www.uipath.com.

Statements we make in this press release may include statements which are not historical facts and are considered forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995, which are usually identified by the use of words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “possible,” “projects,” “outlook,” “seeks,” “should,” “will,” and variations of such words or similar expressions, including the negatives of these words or similar expressions.

These forward-looking statements include, but are not limited to, statements regarding our guidance for the third fiscal quarter and fiscal year 2024, our strategic plans, objectives and roadmap, the estimated addressable market opportunity for our platform and statements regarding the growth of the enterprise automation market, the success of our platform and new releases, the success of our collaborations with third parties, our customers’ behaviors and potential automation spend and details of UiPath’s stock repurchase program. Accordingly, actual results could differ materially or such uncertainties could cause adverse effects on our results. Forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to, risks and uncertainties related to: the market, political, economic, and business conditions, including turmoil and macro-economic effects caused by geopolitical tensions and conflict, increasing inflationary cost trends, and foreign exchange volatility; volatility in credit and financial markets; our recent rapid growth, which may not be indicative of our future growth; our limited operating history; our ability to successfully manage our growth and achieve or maintain profitability; our ability and the ability of our platform and products to satisfy and adapt to customer demands, including our ability to continue to successfully develop, integrate and compete against competitors and new market entrants with artificial intelligence tools and capabilities; our dependency on our existing customers to renew their licenses and purchase additional licenses and products from us and our channel partners; our ability to attract and retain customers; the competitive markets in which we participate; our ability to maintain and expand our distribution channels; our ability to attract, retain and motivate our management and key employees, integrate new team members, and manage management transitions; our reliance on third-party providers of cloud-based infrastructure; the potential effects that regional or global pandemics could have on our or our customers’ businesses, financial conditions and future operating results; our failure to achieve our environmental, social and governance (ESG) goals; and the price volatility of our Class A common stock.

Further information on risks that could cause actual results to differ materially from our guidance can be found in our Annual Report on Form 10-K for the annual period ended January 31, 2023 filed with the SEC on March 24, 2023, and in our Quarterly Reports on Form 10-Q filed with the SEC, and other filings and reports that we may file from time to time with the SEC. Any forward-looking statements contained in this press release are based on assumptions that we believe to be reasonable as of this date. Except as required by law, we assume no obligation to update these forward-looking statements.

Annualized Renewal Run-rate (ARR) is a key performance metric we use in managing our business because it illustrates our ability to acquire new subscription customers and to maintain and expand our relationships with existing subscription customers. We define ARR as annualized invoiced amounts per solution SKU from subscription licenses and maintenance and support obligations assuming no increases or reductions in customers’ subscriptions. ARR does not include the costs we may incur to obtain such subscription licenses or provide such maintenance and support, and does not reflect any actual or anticipated reductions in invoiced value due to contract non-renewals or service cancellations other than for specific reserves, for example those for credit losses or disputed amounts. ARR does not include invoiced amounts associated with perpetual licenses or professional services. ARR is not a forecast of future revenue, which can be impacted by contract start and end dates and duration. ARR should be viewed independently of revenue and deferred revenue as ARR is an operating metric and is not intended to replace these items.

Dollar-based net retention rate represents the rate of net expansion of our ARR from existing customers over the preceding 12 months. We calculate dollar-based net retention rate as of a period end by starting with ARR from the cohort of all customers as of 12 months prior to such period end (Prior Period ARR). We then calculate the ARR from these same customers as of the current period end (Current Period ARR). Current Period ARR includes any expansion and is net of any contraction or attrition over the preceding 12 months but does not include ARR from new customers in the current period. We then divide total Current Period ARR by total Prior Period ARR to arrive at dollar-based net retention rate. Dollar-based net retention rate may fluctuate based on the customers that qualify to be included in the cohort used for calculation and may not reflect our actual performance.

Non-GAAP financial measures are financial measures that are derived from the consolidated financial statements, but that are not presented in accordance with generally accepted accounting principles in the United States (GAAP). This earnings press release includes financial measures defined as non-GAAP financial measures by the SEC, including non-GAAP cost of licenses, non-GAAP cost of subscription services, non-GAAP cost of professional services and other, non-GAAP gross profit and margin, non-GAAP sales and marketing expenses, non-GAAP research and development expenses, non-GAAP general and administrative expenses, non-GAAP operating income (loss) and margin, and non-GAAP net income (loss) and non-GAAP net income (loss) per share. These non-GAAP financial measures exclude:

UiPath uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, by excluding the effects of special items that do not reflect the ordinary earnings of our operations, and as a supplement to GAAP measures. UiPath believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing its financial results with other companies in UiPath’s industry, many of which present similar non-GAAP financial measures to investors. Investors should consider these non-GAAP financial measures in addition to, and not as a substitute for, our financial performance measures prepared in accordance with GAAP. Further, our non-GAAP information may be different from the non-GAAP information provided by other companies. The information below provides a reconciliation of non-GAAP financial measures used in this press release to the most directly comparable GAAP financial measures. We encourage investors to consider our GAAP results alongside our supplemental non-GAAP measures, and to review the reconciliation between GAAP results and non-GAAP measures that is included at the end of this earnings press release. This earnings press release and any future releases containing such non-GAAP reconciliations can also be found on the Investor Relations page of UiPath’s website at https://ir.uipath.com.


UiPath, Inc.
Condensed Consolidated Statements of Operations
in thousands, except per share data
(unaudited)
	Three Months Ended July 31,				Six Months Ended July 31,
	2023		2022		2023		2022
Revenue:
Licenses	$	119,300	$	103,696	$	253,339	$	220,700
Subscription services	159,999		124,656		306,351		240,150
Professional services and other	8,011		13,870		17,208		26,438
Total revenue	287,310		242,222		576,898		487,288
Cost of revenue:
Licenses	3,008		2,170		5,555		4,707
Subscription services	26,777		22,326		49,855		43,371
Professional services and other	19,202		20,080		37,244		41,514
Total cost of revenue	48,987		44,576		92,654		89,592
Gross profit	238,323		197,646		484,244		397,696
Operating expenses:
Sales and marketing	169,725		181,547		330,131		371,329
Research and development	86,606		67,849		161,948		136,539
General and administrative	59,577		68,443		116,161		125,973
Total operating expenses	315,908		317,839		608,240		633,841
Operating loss	(77,585)		(120,193)		(123,996)		(236,145)
Interest income	13,582		4,505		27,430		5,496
Other income (expense), net	7,472		(600)		11,766		(3,411)
Loss before income taxes	(56,531)		(116,288)		(84,800)		(234,060)
Provision for income taxes	3,830		4,090		7,462		8,879
Net loss	$	(60,361)	$	(120,378)	$	(92,262)	$	(242,939)


Net loss per share attributable to common stockholders, basic and diluted	$	(0.11)	$	(0.22)	$	(0.16)	$	(0.45)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted	562,883		546,058		560,422		544,014


UiPath, Inc.
Condensed Consolidated Balance Sheets
in thousands
(unaudited)
	As of
	July 31, 2023		January 31, 2023
Assets
Current assets
Cash and cash equivalents	$	1,093,898	$	1,402,119
Restricted cash	400		—
Marketable securities	735,670		354,774
Accounts receivable, net of allowance for credit losses of $1,128 and $2,698, respectively	226,327		374,217
Contract assets	80,602		69,260
Deferred contract acquisition costs	59,326		49,887
Prepaid expenses and other current assets	107,373		94,150
Total current assets	2,303,596		2,344,407

Marketable securities, non-current	—		2,942
Contract assets, non-current	5,021		6,523
Deferred contract acquisition costs, non-current	134,021		137,616
Property and equipment, net	24,679		29,045
Operating lease right-of-use assets	52,847		52,052
Intangible assets, net	19,244		23,010
Goodwill	90,051		88,010
Deferred tax assets	5,573		5,895
Other assets, non-current	35,108		45,706
Total assets	$	2,670,140	$	2,735,206

Liabilities and stockholders' equity
Current liabilities
Accounts payable	$	1,887	$	8,891
Accrued expenses and other current liabilities	64,404		76,645
Accrued compensation and employee benefits	67,836		142,582
Deferred revenue	384,015		398,334
Total current liabilities	518,142		626,452
Deferred revenue, non-current	103,780		121,697
Operating lease liabilities, non-current	56,699		56,442
Other liabilities, non-current	8,153		10,457
Total liabilities	686,774		815,048
Commitments and contingencies

Stockholders' equity
Class A common stock	5		5
Class B common stock	1		1
Additional paid-in capital	3,888,414		3,736,838
Accumulated other comprehensive income	11,506		7,612
Accumulated deficit	(1,916,560)		(1,824,298)
Total stockholders’ equity	1,983,366		1,920,158
Total liabilities and stockholders’ equity	$	2,670,140	$	2,735,206


UiPath, Inc.
Condensed Consolidated Statements of Cash Flows
in thousands
(unaudited)

	Six Months Ended July 31,
	2023		2022
Cash flows from operating activities
Net loss	$	(92,262)	$	(242,939)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	11,160		8,065
Amortization of deferred contract acquisition costs	31,229		21,860
Net amortization on marketable securities	(10,745)		860
Stock-based compensation expense	187,145		189,706
Charitable donation of Class A common stock	4,215		5,499
Amortization of operating lease right-of-use assets	6,299		4,597
Provision for deferred income taxes	(57)		1,505
Abandonment and impairment charges	—		2,881
Other non-cash charges (credits), net	965		(1,031)
Changes in operating assets and liabilities:
Accounts receivable	147,725		51,707
Contract assets	(9,455)		(26,146)
Deferred contract acquisition costs	(36,389)		(39,572)
Prepaid expenses and other assets	(6,679)		(4,277)
Accounts payable	(6,033)		2,759
Accrued expenses and other liabilities	(4,229)		(14,507)
Accrued compensation and employee benefits	(74,184)		(45,042)
Operating lease liabilities, net	(7,532)		(2,422)
Deferred revenue	(29,547)		9,876
Net cash provided by (used in) operating activities	111,626		(76,621)
Cash flows from investing activities
Purchases of marketable securities	(709,199)		(45,600)

Maturities of marketable securities	338,644		47,433
Purchases of property and equipment	(2,876)		(16,298)
Payments related to business acquisitions, net of cash acquired	—		(29,477)
Other investing, net	2,754		(507)
Net cash used in investing activities	(370,677)		(44,449)
Cash flows from financing activities
Proceeds from exercise of stock options	3,904		4,682
Payments of tax withholdings on net settlement of equity awards	(52,832)		(38,717)
Net payments of tax withholdings on sell-to-cover equity award transactions	(679)		(10,132)
Proceeds from employee stock purchase plan contributions	9,643		8,507
Payment of deferred consideration related to business acquisition	(5,863)		—
Repurchase of unvested early exercised stock options	—		(1,493)
Net cash used in financing activities	(45,827)		(37,153)
Effect of exchange rate changes	(2,943)		(3,144)
Net decrease in cash, cash equivalents, and restricted cash	(307,821)		(161,367)
Cash, cash equivalents, and restricted cash - beginning of period	1,402,119		1,768,723
Cash, cash equivalents, and restricted cash - end of period	$	1,094,298	$	1,607,356


UiPath, Inc.
Reconciliation of GAAP Cost of Revenue, Gross Profit and Margin to Non-GAAP Cost of Revenue, Gross Profit and Margin
in thousands, except percentages
(unaudited)

	Three Months Ended July 31,						Six Months Ended July 31,
	2023			2022			2023			2022

GAAP cost of licenses	$	3,008		$	2,170		$	5,555		$	4,707

Less: Amortization of acquired intangible assets	851			562			1,687			1,158

Non-GAAP cost of licenses	$	2,157		$	1,608		$	3,868		$	3,549


GAAP cost of subscription services	$	26,777		$	22,326		$	49,855		$	43,371
Less: Stock-based compensation expense	3,809			2,841			6,987			6,057
Less: Amortization of acquired intangible assets	594			330			1,178			660
Less: Employer payroll tax expense related to employee equity transactions	85			62			175			146
Less: Restructuring costs	167			137			167			137
Non-GAAP cost of subscription services	$	22,122		$	18,956		$	41,348		$	36,371


GAAP cost of professional services and other	$	19,202		$	20,080		$	37,244		$	41,514
Less: Stock-based compensation expense	3,083			2,528			5,782			6,402

Less: Employer payroll tax expense related to employee equity transactions	68			62			139			141
Less: Restructuring costs	—			320			—			320
Non-GAAP cost of professional services and other	$	16,051		$	17,170		$	31,323		$	34,651


GAAP gross profit	$	238,323		$	197,646		$	484,244		$	397,696
GAAP gross margin	83		%	82		%	84		%	82		%
Plus: Stock-based compensation expense	6,892			5,369			12,769			12,459
Plus: Amortization of acquired intangible assets	1,445			892			2,865			1,818
Plus: Employer payroll tax expense related to employee equity transactions	153			124			314			287
Plus: Restructuring costs	167			457			167			457
Non-GAAP gross profit	$	246,980		$	204,488		$	500,359		$	412,717
Non-GAAP gross margin	86		%	84		%	87		%	85		%


UiPath, Inc.
Reconciliation of GAAP Operating Expenses, Loss, and Margin to Non-GAAP Operating Expenses, Income (Loss) and Margin
in thousands, except percentages
(unaudited)

	Three Months Ended July 31,						Six Months Ended July 31,
	2023			2022			2023			2022

GAAP sales and marketing	$	169,725		$	181,547		$	330,131		$	371,329
Less: Stock-based compensation expense	39,007			35,889			72,130			86,647
Less: Amortization of acquired intangible assets	681			413			1,352			827
Less: Employer payroll tax expense related to employee equity transactions	501			1,202			1,725			2,629
Less: Restructuring costs	1,087			10,732			1,316			10,732
Non-GAAP sales and marketing	$	128,449		$	133,311		$	253,608		$	270,494


GAAP research and development	$	86,606		$	67,849		$	161,948		$	136,539
Less: Stock-based compensation expense	33,071			23,501			57,844			50,124

Less: Employer payroll tax expense related to employee equity transactions	584			320			1,185			801
Less: Restructuring costs	109			43			394			43
Non-GAAP research and development	$	52,842		$	43,985		$	102,525		$	85,571


GAAP general and administrative	$	59,577		$	68,443		$	116,161		$	125,973
Less: Stock-based compensation expense	23,127			23,493			44,402			40,476
Less: Amortization of acquired intangible assets	41			46			82			92
Less: Employer payroll tax expense related to employee equity transactions	491			186			869			363
Less: Restructuring costs	354			802			729			802
Less: Charitable donation of Class A common stock	—			5,499			4,215			5,499
Non-GAAP general and administrative	$	35,564		$	38,417		$	65,864		$	78,741


GAAP operating loss	$	(77,585)		$	(120,193)		$	(123,996)		$	(236,145)
GAAP operating margin	(27)		%	(50)		%	(21)		%	(48)		%
Plus: Stock-based compensation expense	102,097			88,252			187,145			189,706
Plus: Amortization of acquired intangible assets	2,167			1,351			4,299			2,737
Plus: Employer payroll tax expense related to employee equity transactions	1,729			1,832			4,093			4,080
Plus: Restructuring costs	1,717			12,034			2,606			12,034
Plus: Charitable donation of Class A common stock	—			5,499			4,215			5,499
Non-GAAP operating income (loss)	$	30,125		$	(11,225)		$	78,362		$	(22,089)
Non-GAAP operating margin	10		%	(5)		%	14		%	(5)		%


UiPath, Inc.
Reconciliation of GAAP Net Loss and GAAP Net Loss Per Share to Non-GAAP Net Income (loss) and Non-GAAP Net Income (loss) Per Share
in thousands, except per share data
(unaudited)

	Three Months Ended July 31,				Six Months Ended July 31,
	2023		2022		2023		2022
GAAP net loss attributable to common stockholders	$	(60,361)	$	(120,378)	$	(92,262)	$	(242,939)

Plus: Stock-based compensation expense	102,097		88,252		187,145		189,706
Plus: Amortization of acquired intangible assets	2,167		1,351		4,299		2,737
Plus: Employer payroll tax expense related to employee equity transactions	1,729		1,832		4,093		4,080
Plus: Restructuring costs	1,717		12,034		2,606		12,034
Plus: Charitable donation of Class A common stock	—		5,499		4,215		5,499
Tax adjustments to add-backs	1,640		—		2,682		—
Non-GAAP net income (loss)	$	48,989	$	(11,410)	$	112,778	$	(28,883)

GAAP net loss per share, basic and diluted	$	(0.11)	$	(0.22)	$	(0.16)	$	(0.45)
GAAP weighted average common shares outstanding, basic and diluted	562,883		546,058		560,422		544,014


Non-GAAP weighted average common shares outstanding, basic	562,883		546,058		560,422		544,014
Plus: Dilutive potential common shares from outstanding equity awards	11,580		—		12,145		—
Non-GAAP weighted average common shares outstanding, diluted	574,463		546,058		572,567		544,014
Non-GAAP net income (loss) per share, basic	$	0.09	$	(0.02)	$	0.20	$	(0.05)
Non-GAAP net income (loss) per share, diluted	$	0.09	$	(0.02)	$	0.20	$	(0.05)


UiPath, Inc.
Reconciliation of GAAP Operating Cash Flow to Non-GAAP Adjusted Free Cash Flow
in thousands
(unaudited)

	Six Months Ended July 31,
	2023		2022
GAAP net cash provided by (used in) operating activities	$	111,626	$	(76,621)
Purchases of property and equipment	(2,876)		(16,298)

Cash paid for employer payroll taxes related to employee equity transactions	4,830		4,953
Net payments of employee tax withholdings on stock option exercises	924		5,664
Cash paid for restructuring costs	4,792		5,196
Non-GAAP adjusted free cash flow	$	119,296	$	(77,106)