UiPath Q1 FY2027 results

Q1 FY2027 results

UiPath reported fiscal year 2027 Q1 earnings on 28.5.2026. The results showed slight acceleration in growth, including a modest raise in the annual estimate.

Revenues were $418M versus guided $395–400M, increasing 17% year over year. ARR amounted to $1.901B, increasing 12% year over year. Net dollar retention rate was 109%, up from 107% in each of the prior three quarters. This last figure is the one is good since it means the existing install base is spending more with UiPath.

Sixteen out of the top twenty deals in the quarter included AI features. That is the clearest signal available that the agentic pivot is landing with actual customers rather than being a roadmap promise. The thesis is that enterprise customers already running UiPath’s RPA infrastructure will extend it into agentic workflows rather than deploying something new. 16/20 is consistent with that happening.

Cash and cash equivalents dropped from $1.7B in Q4 FY2026 to $1.4B in Q1 FY2027, with buybacks being a significant contributor. Stock-based compensation continues to decline as a percentage of revenue. FCF was $130M in the quarter on a 31% margin.

Amount of users on UiPath’s subreddit has been growing steadily, now at 9.5K followers, while a year ago the same number was 8K if my memory serves. UiPath increased their presence there very recently, starting a pinned thread for product feedback and ideas as well as promising to start sharing future updates on the platform. There also seems to be a good amount of interest for UiPath developers over on LinkedIn, although I haven’t been monitoring that before. These are soft signals, but they are encouraging.

Trend analysis

The narrative weighing on UiPath’s share price has been that AI-based automations would replace or displace traditional deterministic RPA. AI is increasingly seen as either a threat or an opportunity for the company, and the market has not yet made up its mind which. I argued in the investment case that this framing is wrong—LLMs and RPA are complementary, and UiPath’s orchestration layer is what makes LLMs useful inside complex enterprise processes. The Q1 FY2027 numbers are consistent with that view, but do not yet blow it open.

Looking at the trend across the five most recent quarters:

UiPath’s fourth quarter is seasonally its strongest, when large enterprise contracts close before fiscal year end. The year-over-year view is the right lens: +17% on revenue and net new ARR of $49M against $27M a year ago, which is +81% year-over-year on the freshest sales indicator in the report.

ARR growth has been flat at 11% for three quarters and ticked to 12% in Q1. This requires some faith to be taken as a signal of accelerated growth, but it is plausible within the thesis.

Outlook for FY2027

These results are promising, but not great. Ideally we would have seen stronger growth already, but I believe the main reason is not the failure of UiPath to capture enough of enterprise AI automation business, but that business is still in early stages. Enterprise adoption of complex agentic workflows, where UiPath’s orchestration is strong, is still relatively early. With the product improvements and increasing marketing focus on agentic capabilities, I believe UiPath should have the capability to capture a good amount of new deals in the coming quarters.

Q2 FY2027 guidance is $395–400M revenue and ARR of $1.929–1.934B. The revenue guidance midpoint implies roughly +10% YoY, which on its face looks like deceleration from Q1’s 17%. The ARR guidance implies net new ARR of about $28–33M, below Q1’s $49M. But UiPath has beaten its own guidance for five consecutive quarters. The actual numbers are likely to come in above these floors. What I will specifically be looking at when Q2 reports is the actual net new ARR figure—whether the year-over-year trajectory from Q1 holds, or whether it reverts.

Full-year FY2027 guidance was raised to $1.776–1.781B revenue and approximately $425M in free cash flow. Raising guidance after Q1 is UiPath’s standard behavior; it means the year is tracking well.

Considering the stock’s valuation, investing in UiPath still seems like an asymmetric case. I admit this stance needs more defending after only decent rather than great results. In my opinion the asymmetric bet remains valid because the downside is bounded—the existing RPA business is profitable and cash-generative with or without agentic growth—while the upside, if the agentic thesis plays out over a two-to-three year horizon, could be substantial. A stock priced for 4.7% perpetual FCF growth that delivers 12–15% FCF growth re-rates significantly from these levels.

Recently, AI-first companies like Anthropic and OpenAI have also been focusing on LLM-integrated tool development. Systems like Claude Code, which rely on tool-use to perform work, have become popular. For now their focus is on the capabilities of the language models and their interfaces, not on the compliance, audit, and pipeline management functions that enterprise automation requires. UiPath will be the component that allows these increasingly powerful tools to be deployed inside enterprise automation workflows. For as long as that remains true, their developments are not competing with UiPath. They are making UiPath’s offering more powerful as they themselves become more powerful.

Valuation after the results

The multiples have not moved meaningfully since I first wrote about UiPath. Forward P/E of 13x and P/FCF of 17x on a business growing revenue 17% and generating $130M in FCF in its seasonally weakest quarter. The short float at 31.8% tells that many skeptics are still short. The market is still priced for this to be an RPA company slowly losing relevance, which I disagree with.

Disclaimer

The author has a long position in UiPath. This article is not investment advice.