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Revenue climbed 13% to $410.3 million, beating estimates.
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Gross margin narrowed to 80% from 82% a year earlier.
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Retail traders remained largely bullish despite the selloff, with message volume jumping more than 800% and attention turning to UiPath’s Sept. 22 Investor Day.
UiPath, Inc.’s shares fell over 7% in overnight trading late Thursday after a volatile run despite the company reporting strong second-quarter results, with traders pointing to its sharp rally over the past month and narrowing margins as possible reasons behind the reaction.
UiPath revenue rose 13% to $410.26 million, beating analysts’ expectations of $397.8 million, while adjusted earnings were in line with targets at $0.15 per share.
The AI automation company even raised its revenue forecast for the current fiscal year, which ends in January 2028. It now expects a topline in the range of $1.789 billion to $1.794 billion, up from prior guidance of $1.776 billion to $1.781 billion. UiPath’s third-quarter revenue forecast of $440 million-$445 million also came in higher than expectations of $441.17 million.
However, the company’s Q2 gross margins came in at 80%, dipping from 82% in the corresponding year-ago quarter.
PATH stock has been riding a sharp upward momentum in recent months, surging more than 46% in August alone to mark its best monthly performance on record.
Meanwhile, short interest in PATH stock has risen sharply, from under 9% at the start of the year to 21.8% as of Wednesday, according to Koyfin.
Just before the results, Needham raised its price target on PATH stock to $22 from $15, and kept its ‘Buy’ rating, while UBS raised its target to $19 from $12.
Needham analysts had said UiPath’s strengthening fundamentals and strong free cash flow growth were positives and its valuation – 13x enterprise value to estimated free cash flow – made the stock compelling at current levels.
UiPath: Management Changes
The AI automation company reshuffled its leadership, with Ashim Gupta continuing as chief operating officer after stepping down as CFO, Hitesh Ramani promoted to CFO, Brad Brubaker elevated to chief legal and administrative officer, and Kaiser Permanente executive Yazdi Bagli appointed to its board.
Retail View On PATH
PATH was among the top five trending tickers on Stocktwits at the time of writing, with retail sentiment shifting to ‘extremely bullish’ from ‘bullish.’ The stock’s 24-hour message volume rose over 800%.
