UiPath (NYSE:PATH) Shares Fall as Q2 Outlook Indicates Reduced ARR Growth

NEW YORK, July 30, 2026, 2:01 p.m. EDT — Shares of UiPath NYSE:PATH declined after the company forecasted slower additions to annualized recurring revenue for the second quarter.

The stock dropped 3.3% to $12.18 in early U.S. trading.
Initial estimates indicate Q2 guidance suggests net new ARR between $28 million and $33 million.
Initial estimate: market value, adjusted for cash, is approximately 2.8 times the projected revenue for fiscal 2027.

UiPath shares declined even as U.S. equities rose on Thursday. The company’s investor updates have not posted anything fresh since June 16, making the second quarter outlook the main reference point for investors.

Annualized renewal run-rate, or ARR, is the main metric. UiPath forecasts $1.929 billion to $1.934 billion for July 31, up from $1.901 billion on April 30.

Initial estimate: the guidance suggests net new ARR between $28 million and $33 million. This midpoint is 38% lower than the $49 million posted in Q1. Compared to $31 million in the same period last year, it shows little change. Seasonal trends impact quarter-to-quarter performance. The lack of year-over-year growth remains significant.

The operating cadence is detailed below. Figures marked with an asterisk are preliminary estimates.

Metric	Q2 FY2026 actual	Q1 FY2027 actual	Q2 FY2027 guide
Revenue	$362m	$418m	$395m–$400m
Year-on-year revenue growth	14%	17%	9.1%–10.5%
Ending ARR	$1.723bn	$1.901bn	$1.929bn–$1.934bn
Net new ARR	$31m	$49m	$28m–$33m
Dollar-based net retention	108%	109%	Not provided
Non-GAAP operating income	$62m	$92m	Roughly $75m

Company guidance provides preliminary estimates for Q2 FY2027 growth and net new ARR.

Chief Executive Daniel Dines stated in May that agentic offerings were “moving from pilot to production.” The Q2 ARR bridge will indicate how rapidly this transition reflects in contractual agreements. UiPath, Inc.

Early estimates show Q2 revenue growth easing to a range of 9.1%–10.5%. The projected non-GAAP operating margin is roughly 18.9% at the midpoint, exceeding last year’s 17.1% but lower than the 22.0% reported in Q1.

Thursday’s software market activity was selective rather than widely positive.

Company	Latest price	Day move	Intraday range
UiPath Inc. NYSE:PATH	$12.18	down 3.3%	$11.67–$12.63
Microsoft Corp. NASDAQ:MSFT	$456.31	up 16.8%	$417.00–$457.90
Salesforce Inc. NYSE:CRM	$180.45	down 4.2%	$175.95–$189.17
ServiceNow Inc. NYSE:NOW	$109.31	down 5.6%	$106.45–$116.72

Most recent trades as of 1:46 p.m. EDT. Day changes are initial estimates based on current prices and previous closing values.

Microsoft shares rose following an outlook for higher sales and cloud expansion. The company’s capital spending projection came in beneath expectations. In contrast, Salesforce, ServiceNow, and UiPath declined. The divergence indicates investors favored proven AI gains instead of general software involvement.

Seth Hickle explained the benchmark. “This earnings season is about AI execution, not AI enthusiasm,” said the Mindset Wealth Management investment chief. Reuters

UiPath increased its full-year guidance following Q1. The midpoint of its profit outlook saw the bigger adjustment.

Fiscal 2027 metric	March outlook	May outlook	Midpoint change
Revenue	$1.754bn–$1.759bn	$1.776bn–$1.781bn	+$22m
Ending ARR	$2.051bn–$2.056bn	$2.058bn–$2.063bn	+$7m
Non-GAAP operating income	Approximately $415m	Approximately $430m	+$15m

These midpoint adjustments are early estimates.

The upgrade suggests there is no widespread decline in demand. However, it still leaves the immediate outlook for bookings uncertain. Guidance for ARR at the midpoint edged up by just around 0.3%. The projected operating income was raised by approximately 3.6%.

The valuation demonstrates that tension.

Valuation summary	Value
Present market cap	$6.43bn
Cash and liquid investments	$1.42bn
Market value net of cash	$5.01bn
FY2027 projected revenue midpoint	$1.779bn
Net market value/revenue	2.8 times
FY2027 ending ARR estimate midpoint	$2.061bn
Net market value/ending ARR*	2.4 times

Early estimates. Cash reflects figures from April 30; market capitalization is based on the most recent price data.

Preliminary figures show that cash is approximately 22% of market capitalization. This lessens balance-sheet risk but does not lead to sustained growth.

UiPath allocated $243.8 million for share buybacks in Q1, at an average price of $11.47 per share. The company acquired an additional 2.4 million shares at $9.63 each by May 15. On Thursday, the stock traded above both these prices.

Risks: ARR might fall short of the projected range. Growth could soften due to pricing competition, challenges with customer retention, or broader macroeconomic disruptions. Stock-based compensation could offset advantages gained from share repurchases.

The ARR balance on July 31 offers the clearest read. At nearly $12, UiPath trades at 2.8 times cash-adjusted revenue. Accelerating ARR growth remains the crucial element.

TS2 TECH • EXTENDED COVERAGE

Further analysis

Editorial insight

Where is UiPath stock trading today?

UiPath traded near $12.19 at 1:44 p.m. Eastern on July 30. That was about 3.2% below Wednesday’s closing price of $12.59. At the same time, the S&P 500 was gaining roughly 1.5%. The live equity value was approximately $6.43 billion at that quote. PATH remained 38.6% below its $19.84 high for the past year. The quote is intraday and may move before Thursday’s close. The Wall Street Journal

Did the latest quarter show genuine business acceleration?

First-quarter fiscal 2027 revenue reached $418.4 million, rising 17% year over year. ARR increased 12% to $1.901 billion, with $49 million of net new ARR. Revenue beat management’s prior guidance midpoint by $20.9 million, or 5.3%. Net retention was 109%, while GAAP gross margin remained 82%. Currency added roughly $7 million; underlying revenue growth was about 15%. The quarter beat guidance, although ARR growth still trailed reported revenue growth. UiPath, Inc.

What does the raised fiscal 2027 outlook imply?

Management now expects fiscal 2027 revenue between $1.776 billion and $1.781 billion. The midpoint implies 10.4% growth from fiscal 2026 revenue. Year-end ARR guidance spans $2.058 billion to $2.063 billion. Its midpoint implies 11.2% growth from January’s $1.853 billion ARR. Non-GAAP operating income guidance increased to approximately $430 million. That forecast is 16.2% above fiscal 2026’s $370 million result. The May update raised revenue’s midpoint by $22 million from March. UiPath, Inc.

What must UiPath deliver in the second quarter?

UiPath guides second-quarter revenue between $395 million and $400 million. At the midpoint, revenue would grow about 9.9% year over year. ARR guidance is $1.929 billion to $1.934 billion, implying roughly 12.1% growth. That midpoint requires about $30 million of sequential net new ARR. Non-GAAP operating income is guided near $75 million, up 21%. Investors will likely focus more on ARR than quarterly license timing. UiPath, Inc.

Is agentic AI producing measurable commercial results?

Management said AI featured in 16 of UiPath’s 20 largest quarterly deals. Expansion transactions containing AI were six times larger than those without it. Customers generating at least $100,000 of ARR rose 11% to about 2,620. The million-dollar customer cohort increased 18% to 374 accounts. However, UiPath has not disclosed a current ARR figure for AI products. The evidence is commercial, but product-level revenue visibility remains limited. The Motley Fool

How strong is UiPath’s profitability now?

GAAP operating income reached $28.0 million, versus a $16.4 million loss last year. That equals a 6.7% operating margin on quarterly revenue. Non-GAAP operating income was $92.5 million, producing a 22% margin. GAAP net income totaled $22.5 million, or $0.04 per diluted share. Stock-based compensation still measured $53.3 million during the quarter. Profitability improved sharply, but adjusted earnings remain materially higher than GAAP. UiPath, Inc.

How much financial flexibility remains after buybacks and acquisitions?

Cash and marketable securities totaled $1.42 billion at April 30. Operating cash flow was $131.9 million during the quarter. UiPath spent $243.8 million repurchasing Class A shares. It bought 20.4 million shares at an average $11.47 price. Another 2.4 million shares were purchased near $9.63 by mid-May. Cash also funded a $149.4 million net acquisition payment for WorkFusion. Weighted average basic shares fell 4.5% from the prior year. UiPath, Inc.

Is UiPath cheaply valued at today’s price?

At $12.19, UiPath’s equity value was roughly $6.43 billion. That equals about 3.6 times management’s fiscal 2027 revenue midpoint. Subtracting April cash and securities gives roughly $5.01 billion before other adjustments. That figure equals about 2.8 times guided revenue. It also equals 11.7 times guided non-GAAP operating income. Non-GAAP earnings exclude stock compensation and several acquisition-related costs. Investors must weigh those multiples against forecast ARR growth near 11%. UiPath, Inc.

What do Wall Street analysts currently forecast?

FactSet’s current consensus rating is Hold, based on 22 recommendations. The mix includes three Buys, one Overweight, and seventeen Holds. One analyst rates UiPath Underweight, while none currently recommend Sell. The average price target is $13.40, with a $13.00 median. Targets range from $12.00 to $17.00. The average implies roughly 10% upside from today’s intraday quote. These targets are estimates and can change rapidly. The Wall Street Journal

What are the biggest risks to the forecast?

ARR guidance implies 11.2% midpoint growth for fiscal 2027. Attrition remains concentrated among UiPath’s smallest customers. Management also flags disruptive technologies, cloud dependencies, and macroeconomic volatility. About 53% of first-quarter revenue was denominated in non-dollar currencies. UiPath estimates a 10% currency move would affect translated results by $46.8 million. Short interest reached 28.9% of float on July 15. That can sharpen reactions to any guidance miss. UiPath, Inc.

Michał Rogucki Latest posts

Michał Rogucki is a senior markets reporter at TS2.tech, specializing in stocks, technology and macroeconomic developments. A graduate of Humboldt University of Berlin, he previously worked in investment research and market analysis before transitioning to financial journalism. He covers the trends and events that matter most to investors worldwide.

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