UiPath - Your AI Pick For The Next 5 Years?

RPA is a technology that uses software robots to automate repetitive tasks that humans usually perform on computers. UiPath provides tools and platforms to create, manage, and run these software robots.

It released its Q4 and FY 22 results.

Here's what I found.

Even though YoY revenue growth was just 7%, ARR growth YoY achieved 30%.

The operating margin for Q4'22 improved to -15%, while the non-GAAP operating margin is at 22%.

For software companies, it is imperative to understand how sticky their software is.

And to gauge that, the more customers pay UiPath, the more we can gauge the stickiness of UiPath's offerings.

Large customers who generate > USD 100k in ARR increased from 1,493 to 1,785.

While C-suite priority customers also jumped from 158 to 229.

Guidance for UiPath is lackluster in my opinion.

ARR for Q1'24 will be between USD 1.245 billion - USD 1.25 billion. That is just marginally higher than the Q4'22 achievement.

However, non-GAAP operating income for FY 2024 guidance is at USD 120 million, which is a 185% growth versus FY 2023.

Profitability growth outweighs top-line growth.

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