UiPath 2026 Q3 Earnings 1966.2% Net Income Surge Marks Profitability Turnaround

UiPath (PATH) delivered a historic turnaround in Q3 2026, reporting $198.84 million in net income—a 1966.2% increase from a $10.65 million loss in the prior-year quarter. The stock surged 36.61% weekly, hitting a 19-month high, while revenue grew 15.9% to $411.11 million. CFO Ashim Gupta highlighted "solid results exceeding guidance" and a "first GAAP profitable third quarter," with annual recurring revenue (ARR) reaching $1.782 billion.

Revenue

UiPath’s Q3 2026 revenue of $411.11 million was driven by robust performance across all segments. Licenses contributed $150.04 million, while Subscription Services added $247.57 million, underscoring the company’s shift toward recurring revenue models. Professional Services and Other accounted for $13.50 million, rounding out the total. This 15.9% year-over-year growth reflects strong demand for automation solutions, with Subscription Services comprising 60.2% of total revenue.

Earnings/Net Income

UiPath’s profitability rebounded sharply, with EPS rising from a $0.02 loss in Q3 2025 to $0.37 in Q3 2026. Net income surged to $198.84 million, a 1966.2% improvement, as the company exited six years of quarterly losses. Operating efficiency and cost management initiatives appear to have reversed earlier financial challenges.

UiPath’s Q3 2026 results reflect a remarkable turnaround, with EPS surging 1950% and net income jumping 1966.2% to $198.84 million, marking a return to profitability after six years of losses.

Post-Earnings Price Action Review

The buy-the-dip strategy for PATH following the Q3 2026 earnings beat proved disastrous, with a 30-day total return of -41.50% versus a 53.21% benchmark. Despite a 0.00% maximum drawdown—suggesting no losses during the backtest—the approach failed to capture gains, yielding a CAGR of -12.20% and a Sharpe ratio of -0.18. This underperformance highlights market skepticism toward post-earnings momentum in automation stocks, even with strong fundamentals.

CEO Commentary

UiPath CEO Raja Koduri emphasized the company’s “operational rhythm and execution” as key drivers of the Q3 turnaround. He reiterated confidence in the platform’s scalability and market leadership, noting that the return to profitability validates long-term strategic investments. Koduri also highlighted the importance of balancing innovation with cost discipline to sustain momentum.

Guidance

UiPath provided forward-looking guidance, targeting Q4 2026 revenue of $462–$467 million and ARR of $1.844–$1.849 billion by year-end. The company expects to maintain its focus on subscription growth and margin expansion, with no material capital expenditures planned for the remainder of 2026.

Additional News

UiPath insiders executed large share sales in the week following the earnings report. Officer Brad Brubaker sold 27,580 shares ($511.7K) via a prearranged 10b5-1 plan, while Chairman Daniel Dines offloaded 45,000 shares ($864.6K). These moves, though routine for insider trading plans, raised questions about short-term sentiment. Separately, PATH shares climbed 35% to a record high on Q3 results, outperforming the broader automation sector as investors priced in improved margins and ARR growth.