UiPath Inc Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Mark Murphy - JPMorgan - Analyst : My congratulations on the successful execution this quarter. Daniel, I wanted to ask you, as we look around and see the genic models that are being rolled out by Salesforce Microsoft HubSpot in several other companies. Can you comment on whether any of that activity might drive some UI path usage because I'm just wondering, as the third-party agents begin to want to take some action and they want -- they might want to command and control other applications. Do you think that's going to be API-based where they can handle it? Or do you think that there could be some involvement with -- there might be a UI-based process and it might get -- might call on UiPath? And then I have a quick follow-up.

Question: Mark Murphy - JPMorgan - Analyst : Okay. I think I understand that. It sounds like a very broad vision. I wanted to ask you, Ashim, I'm looking at the growth rate of your largest revenue stream, which is the maintenance and support revenue. And I noticed it accelerated both sequentially and year-over-year. It seems to be holding on to mid-20s type of trajectory. So I wonder if I could just ask you, mechanically, what is it that's enabling that line item is really showing a lot of resiliency and stronger growth actually than the ARR line, -- and just in case the answer is a little bit of a duration impacting the license line. Can you maybe help us separate out any of that? I'm just wondering if you can just help us a little bit with some of the mechanics.

Question: Mark Murphy - JPMorgan - Analyst : Okay. And that -- are you able to comment on how the duration might have changed in this most recent quarter? Or how much of recovered since earlier in the year?

Question: Mark Murphy - JPMorgan - Analyst : Understood. Thank you very much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 10:00PM, PATH.N - Q3 2025 UiPath Inc Earnings Call

Question: Raimo Lenschow - Barclays - Analyst : I actually wanted to -- Dan, I wanted to go back to that agent model. Like how should we think about that like there's going to be the big vendors that have like the domain data like the Salesforce or Workday or an SAP. And they're going to be very broad based in here in terms of the orchestration. So do you see yourself like working with those, but actually the real kind of push for you guys will be like on kind of more specific domain knowledge where you're playing already at the moment with insurance companies, banks, et cetera. Is that kind of the right way to think about it? Or I'm just -- there's a lot of confusion out there. So if you could help us there, that would be helpful. And I have one follow-up for Ashim.

Question: Raimo Lenschow - Barclays - Analyst : Okay. Perfect. And then, Ashim, like I get the message on the net new ARR aren't stabilizing next year. on the growth rate side. Like what gives you the confidence for that? Like maybe just give us -- help us a little bit with some handholding here.

Question: Raimo Lenschow - Barclays - Analyst : Okay, perfect. Thank you. Well done. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 10:00PM, PATH.N - Q3 2025 UiPath Inc Earnings Call

Question: Jay Roberge - William Blair & Company - Analyst : Sounds like execution has been improving recently. Can you just talk about the go to America changes that you've been able to make thus far? And then what do you feel is left within the go-to-market order to get things back to kind of steady execution that we used to see.

Question: Jay Roberge - William Blair & Company - Analyst : Okay. Very helpful. And then can you talk about just the feedback that you've gotten from customers coming out of your board conference and maybe the pipeline that you were able to generate there. and what you're hearing from customers just around the Agentic use cases that they might be building on their platform, just given that you had so many customers and partners there forward recently?

Question: Jay Roberge - William Blair & Company - Analyst : Great. Thanks for taking the questions and congrats on the steady execution.

Question: Bryan Bergin - TD Cowen - Analyst : I have a follow-up question first on the changes that you do still want to make internally as you're aiming to return to those external routes. It sounds like you're pleased with the execution so far. But specifically, what else do you have left to do?

Question: Bryan Bergin - TD Cowen - Analyst : Okay. Okay. I appreciate that. And then US government is a notable customer for you across many agencies, just given all the talk about improved government efficiency in US, how are you thinking about that market opportunity going forward?.

Question: Mike Richards - RBC Capital Markets - Analyst : This is Mike Richards on for Matt. It was great to hear about the improved execution, but I was wondering maybe how the demand environment has changed since last quarter? And if you've noted any difference in buying patterns post election, -- and then maybe also like do you guys usually see a budget flush at year-end and with the new agent vision, could you kind of tap into those Gen AI project dollars that maybe you weren't seeing before?

Question: Mike Richards - RBC Capital Markets - Analyst : Thanks, guys.

Question: Sanjit Singh - Morgan Stanley - Analyst : Ashim, thank you so much for providing at least some of that color on fiscal year '26. I'd love to get a better understanding of what you mean by stabilized when do you think of stabilizing on sort of a dollars added basis. I think you guys had it around $56 million in net new ARR this year. Are

Question: Sanjit Singh - Morgan Stanley - Analyst : Yes. And to that point on that better execution, it's two quarters in a row now where you've set guide and exceeded those targets. Not so much about like necessarily guidance. But with the improved execution, if you got, let's say, a better spending environment or to the extent that the REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 10:00PM, PATH.N - Q3 2025 UiPath Inc Earnings Call commercial market starts to come back online, -- how much of that -- how much do you think that would be a tailwind to your ARR growth overall? .

Question: Sanjit Singh - Morgan Stanley - Analyst : Understood. Very clear. Thank you, Ashim.

Question: Terry Tillman - Truist Securities - Analyst : It's one question. It's three parts. So SOLEX is not a common thing for ISV, so to capture that just suggests the closeness you have with the company and the opportunity. But I'm curious about SOLEX. First, in terms of the timing on how this could kind of go through their ecosystem? Because earlier I heard, I think, Ashim talked about sales enablement, there's going to be sales enablement around this. And I know you've been working with them. But SOLEX in terms of making its way through that very vast distribution channel. Second question I wanted to ask is with Test Suite. This is a multiyear kind of S/4HANA upgrade cycle. How impactful is that starting to be and predictable each quarter? And then the third thing, and I can repeat all these if you don't run them doubt, Solex deals, I assume though it's a little bit different on rev rec as opposed to if it was just on your paper. So anything you could share about how those deals would look?.

Question: Chirag Ved - EVERCORE ISI - Analyst : This is Chirag on for Kirk. So when you're thinking through your customer renewals and expansion over the last couple of quarters and looking ahead to next quarter, are there any recurring themes or products that you would highlight I think, greater traction and contributing to a greater part of our net new ARR recently that might be different from before?

Question: Chirag Ved - EVERCORE ISI - Analyst : Got it. And one more on the financial front. You delivered a strong margin beat this past quarter. You called out the restructuring, but what drove the beat? And do you believe these same factors could help drive upside in Q4, given that Q4 has historically been your strongest margin quarter.

Question: Chirag Ved - EVERCORE ISI - Analyst : All right. Thank you so much.

Question: Kingsley Crane - Canaccord Genuity - Analyst : So within your cloud business, could you provide a directional comments on the mix of hybrid cloud and pure SaaS?

Question: Kingsley Crane - Canaccord Genuity - Analyst : Great. And so just as a quick follow-up, I guess, like how are you thinking about the customer's ability to leverage some of these newer capabilities like Agent AI, depending if they're deployed Pure SaaS hybrid on-premise.

Question: Kingsley Crane - Canaccord Genuity - Analyst : Thanks. That's really helpful. Appreciate it.

Question: Brian Schwartz - Oppenheimer & Co., Inc. - Analyst : Daniel, I know it's real early in terms of the ASPs that you're getting for these agentic automation deals. And maybe it's even hard to parse out. But -- is it possible to compare the ASPs on these type of deals versus the other products in the suite? And I know it's early, but I'm trying to see if they -- when they scale, if they could end up being larger deals than the core products in the suite?