UiPath’s stock had an impressive takeoff on the market last Friday. After releasing the figures, the stock of the process automation specialist skyrocketed by 26%. This means that the stock has doubled in the current stock market year (+103%). However, the stocks are still miles away from their historic highs of $85, which the stock reached shortly after the IPO on May 24, 2021.

Leaders in Process Automation Although the company may not yet be a household name to the general investing public, UiPath is well known in industry circles. The company has developed a platform for so-called Robotic Process Automation (RPA or RPAAI) for business customers. In this process, processes are learned and automated by so-called software robots (bots). The company uses artificial intelligence to automate repetitive and routine back-office tasks.

These actions include logging into applications, extracting information from documents, moving folders, filling out forms, and updating fields of information and databases. Examples from practice during the coronavirus crisis are hospital registrations or processing loan applications.

Analysts expect high market growth This robotics segment is considered particularly exciting by experts. The company itself quantifies the potential market volume at over $61 billion, with a strong upward trend. With the additional growth potential, UiPath estimates the total addressable market at $93.2 billion.

UiPath with broad customer portfolio How strongly UiPath has been able to grow recently can be seen from a look at the current figures. Currently, 10,865 customers use the company’s software. Especially large customers are playing an increasingly important role: In the third quarter, the number of customers with an annual turnover of more than one million dollars increased year-on-year by 263 to 1,974. New Relic, Smile Doctors, Beacon Health System and MidWestOne Financial Group were recently able to be won as new customers.

Revenue climbs 24% – Growth dynamic picks up again In the third quarter, which ended in October 2023, UIPath generated revenue of $326 million. This was 24.1% higher than the previous year and $10.38 million above analysts‘ expectations (Source: Seekingalpha). This surpassed the growth dynamics of the previous quarters (Q2: +19%; Q1: +18%). The US automation software developer also increased its Annual Recurring Revenue (ARR) by around 24% to $1.378 billion in the reporting period.

Less loss than in the previous year In the end, the company remains in the red. The net result of the software specialist in the reporting period was minus $31.5 million, which was better than in the previous quarter (-$57.7 million). Adjusted, the company posted a profit of 12 cents per share, which was 5 cents above the expectations of Wall Street analysts. However, the company can certainly afford the losses. At the end of the quarter, UiPath still had a mountain of cash of $1.8 billion and no liabilities.

For the full year, UiPath expects revenue between $1.273 and $1.278 billion. The operating result (non-GAAP) is expected to be $188 million for the full year.

Analysts remain reserved The analysts, meanwhile, are divided. Of the 20 experts dealing with the stock, 9 recommend buying the shares. Eleven bankers recommend holding the position. The average price target of $23.76 (Source: marketwatch.com) was already reached after the stock explosion on Friday. Whether the bankers will adjust their forecasts upwards in the coming months will soon be seen.