Core Insights - BigBear.ai and UiPath represent two distinct investment opportunities in the AI market, with BigBear.ai focusing on data analysis through edge networks and UiPath specializing in automation via software robots [1] - Both companies have underperformed since their public offerings, with BigBear.ai trading below $7 from an initial $9.84 and UiPath at approximately $18 from an IPO price of $56 [2] BigBear.ai Overview - BigBear.ai develops three AI modules: Observe, Orient, and Dominate, which analyze data and predict outcomes [4] - The company is acquiring Ask Sage for $250 million to enhance its AI ecosystem, expected to close by late 2025 or early 2026 [5] - BigBear.ai's revenue growth has been sluggish, increasing from $146 million in 2021 to $158 million in 2024, hindered by the bankruptcy of its major client Virgin Orbit and competitive pressures [8] - For 2025, BigBear.ai anticipates a revenue decline of 11%-21% to $125-$140 million due to disruptions in government contracts [9] - Analysts project a revenue increase of 23% to $164 million in 2026, but a subsequent decline of 2% to $162 million in 2027, indicating ongoing challenges in core business growth [9] UiPath Overview - UiPath is the largest robotic process automation (RPA) company, automating repetitive tasks and expected to benefit from a projected CAGR of 43.9% in the RPA market from 2025 to 2030 [10] - From fiscal 2021 to fiscal 2025, UiPath's revenue grew from $608 million to $1.4 billion, but growth slowed to just 9% in the last fiscal year [12] - For fiscal 2026, UiPath expects revenue growth of 11%-12% to nearly $1.6 billion, indicating resilience against competition from generative AI platforms [14] - Analysts forecast revenue and adjusted EPS growth of 9% and 13%, respectively, for fiscal 2027, suggesting continued healthy growth despite a deceleration in high-growth rates [15] Investment Comparison - BigBear.ai has an enterprise value of $3.1 billion, trading at 19 times next year's sales, while UiPath, with an enterprise value of $8.4 billion, trades at just five times next year's sales [16] - UiPath's consistent organic growth, rising GAAP profits, and lower valuation position it as a more attractive investment compared to BigBear.ai [16]

Revenue Performance - Quarter-to-date revenue of $411.1 million increased 16% year-over-year[149] - Year-to-date revenue of $1,129.5 million increased 12% year-over-year[149] - Total revenue for the three months ended October 31, 2025, was $411.1 million, a 16% increase from $354.7 million in the same period of 2024, driven by a $40.7 million increase in subscription services revenue and a $12.9 million increase in licenses revenue[174] - Total revenue for the nine months ended October 31, 2025, was $1,129,465,000, an increase of $123,447,000, or 12%, from $1,006,018,000 in 2024, with subscription services revenue growing by $116,513,000, or 20%[184] Customer Metrics - The number of customers with ARR ≥ $1 million increased to 333 from 302 year-over-year[155] - Dollar-based net retention rate was 107% as of October 31, 2025, down from 113% in 2024[155] Profitability and Margins - Gross margin was 83% for the three and nine months ended October 31, 2025, compared to 82% for the same period in 2024[149] - Gross profit for the three months ended October 31, 2025, was $342.3 million, resulting in a gross margin of 83%, compared to 82% in the same period of 2024[176] - Total cost of revenue increased by $5.0 million, or 8%, to $68.8 million for the three months ended October 31, 2025, driven by a $9.4 million increase in costs associated with professional services[175] - Total cost of revenue increased by $14,641,000, or 8%, to $197,049,000 for the nine months ended October 31, 2025, compared to $182,408,000 in 2024, with a gross margin of 83%[185] Operating Expenses - Operating expenses decreased by $5.0 million, or 1.5%, to $329.2 million for the three months ended October 31, 2025, primarily due to a reduction in sales and marketing expenses[177] - Sales and marketing expenses decreased by $8.0 million, or 4%, to $179.2 million, representing 44% of total revenue, down from 53% in Q3 2024[178] - Sales and marketing expenses decreased by $56,507,000, or 10%, to $505,150,000 for the nine months ended October 31, 2025, compared to $561,657,000 in 2024, representing 45% of revenue[187] - Research and development expenses for the three months ended October 31, 2025, were $96,869,000, a slight decrease of $107, or 0%, compared to $96,976,000 in the same period of 2024, representing 23% of revenue[179] - Research and development expenses for the nine months ended October 31, 2025, were $281,012,000, an increase of $9,037,000, or 3%, from $290,049,000 in 2024, accounting for 26% of revenue[188] - General and administrative expenses increased by $3,085,000, or 6%, to $53,175,000 for the three months ended October 31, 2025, compared to $50,090,000 in 2024, accounting for 13% of revenue[180] - General and administrative expenses decreased by $16,376,000, or 9%, to $160,743,000 for the nine months ended October 31, 2025, compared to $177,119,000 in 2024, representing 14% of revenue[189] Net Income and Tax - The company reported a net income of $198.8 million for the three months ended October 31, 2025, compared to a net loss of $10.7 million in the same period of 2024[172] - Benefit from income taxes increased by $162.4 million for the nine months ended October 31, 2025, compared to the same period in 2024, primarily due to the release of valuation allowance associated with U.S. federal and New York City and State DTAs[193] - The effective tax rate was significantly impacted by a benefit from income taxes of $(174.2) million for the three months ended October 31, 2025, compared to $(14.8) million in Q3 2024[172] Cash Flow and Financial Position - Cash flow from operations was $188.9 million for the nine months ended October 31, 2025, compared to $174.5 million for the same period in 2024[149] - Cash and cash equivalents, restricted cash, and marketable securities were $1,520.2 million as of October 31, 2025, down from $1,724.1 million as of January 31, 2025[149] - As of October 31, 2025, the company had cash, cash equivalents, and marketable securities totaling $1,519.8 million, with an accumulated deficit of $1,810.0 million[194] - Net cash provided by operating activities for the nine months ended October 31, 2025, was approximately 1% lower than the $174.5 million reported for the same period in 2024[201] - Net cash provided by investing activities for the nine months ended October 31, 2025, was $20.2 million, driven by $585.1 million in maturities of marketable securities[203] - Net cash used in financing activities for the nine months ended October 31, 2025, was $358.0 million, primarily due to $329.1 million in repurchases of Class A common stock[205] Strategic Initiatives - The company completed a workforce restructuring to streamline operations and focus on AI and innovation[151] - The company expects operating expenses to decrease as a percentage of revenue over the long term[168] - The company anticipates a reasonable possibility of realizing a valuation allowance for U.S. state deferred tax assets within the next 12 months, which could result in an income tax benefit[171] - The company maintained a partial valuation allowance on U.S. state deferred tax assets and a full valuation allowance on Romania deferred tax assets as of October 31, 2025[171] - The company may require additional equity or debt financing in the future to support its operations and innovation efforts[196] Foreign Currency Impact - Approximately 51% of the company's revenues and 40% of its expenses for the nine months ended October 31, 2025, were denominated in non-U.S. dollar currencies, resulting in net foreign currency transaction losses of $6.5 million[215] - The estimated translation impact of a hypothetical 10% change in foreign currency exchange rates would amount to $34.0 million for the nine months ended October 31, 2025[215]

Company Performance - UiPath shares have increased by 30.6% over the past month and reached a new 52-week high of $18.98, with a year-to-date gain of 46.9% compared to 29% for the Zacks Computer and Technology sector and 9.6% for the Zacks Internet - Software industry [1] - The company has consistently exceeded earnings expectations, reporting EPS of $0.16 against a consensus estimate of $0.14 in its last earnings report [2] Earnings and Revenue Projections - For the current fiscal year, UiPath is projected to achieve earnings of $0.65 per share on revenues of $1.58 billion, reflecting a 22.64% increase in EPS and a 10.65% increase in revenues [3] - The next fiscal year forecasts earnings of $0.72 per share on revenues of $1.71 billion, indicating a year-over-year change of 10% in EPS and 8.16% in revenues [3] Valuation Metrics - UiPath has a Value Score of F, while its Growth and Momentum Scores are B and A, respectively, resulting in a VGM Score of B [6] - The stock trades at 28.7X current fiscal year EPS estimates, slightly below the peer industry average of 29.8X, and has a trailing cash flow multiple of 615.5X compared to the peer group's average of 24X [7] Zacks Rank - UiPath holds a Zacks Rank of 2 (Buy) due to favorable earnings estimate revisions, making it a suitable choice for investors looking for stocks with strong potential [8] Industry Comparison - The Internet - Software industry is positioned in the top 27% of all industries, suggesting favorable conditions for both UiPath and its peer, Five9, Inc. [11]

Core Insights - UiPath shares surged following strong fiscal third-quarter results and positive guidance, with a year-to-date increase of approximately 38% [2] - The company is transitioning from a robotic process automation (RPA) provider to an AI orchestration platform, focusing on managing both bots and AI agents [3] Financial Performance - For the fiscal third quarter, revenue increased by 16% year-over-year to $411 million, exceeding analyst expectations of $392.9 million [6] - The annualized renewal run rate (AAR) rose by 11% year-over-year to $1.78 billion, with an addition of $59 million in new ARR during the quarter [6] - Dollar-based net retention was reported at 107%, indicating growth within the existing customer base, alongside a gross retention rate of 98% [7] Customer Metrics - UiPath ended the quarter with 10,860 customers, an increase of 40 from the previous quarter and 70 year-over-year [8] - Customers generating $100,000 or more in ARR increased by 74 sequentially to 2,506, up from 2,235 a year ago [8] - Clients with $1 million or more in ARR rose to 333, compared to 320 in the previous quarter and 302 a year ago [8] Strategic Initiatives - The company is experiencing strong momentum in its AI agent orchestration strategy, with over 950 companies creating AI agents on its platform [4] - Recent innovations include integrations with major AI companies like Nvidia, Alphabet, and Microsoft, and the introduction of ScreenpPlay, which enhances automation by combining RPA with large language models [5] - The AI orchestration platform is witnessing revenue acceleration, although the company is still in the early stages of realizing its full potential [9]

Core Insights - UiPath and Palantir Technologies both exceeded Q3 earnings estimates, indicating strong performance in their respective sectors [1] Company Performance - UiPath reported robust growth driven by its automation solutions, reflecting a strong demand for AI-driven process automation [1] - Palantir Technologies showcased its data analytics capabilities, emphasizing its unique approach to AI and data integration [1] Business Models - The results from both companies highlight fundamentally different AI business models, with UiPath focusing on automation and Palantir on data analytics [1]

Group 1: Retail Investor Interest - Retail investors showed significant interest in five stocks: Meta Platforms Inc., Salesforce Inc., UiPath Inc., Netflix Inc., and Tesla Inc., driven by earnings reports, retail hype, AI developments, and corporate news [1] - The stocks represent diverse sectors including social networking, AI, software, robotics, streaming, and automotive [1] Group 2: Meta Platforms Inc. (META) - Meta Platforms is under an EU antitrust probe regarding its WhatsApp AI policies, which may restrict third-party AI competition and could result in substantial fines [5] - The company announced plans for up to 30% budget cuts to metaverse initiatives, shifting focus to AI, with projected capital expenditures of $72 billion for 2026 [5] - META stock had a 52-week range of $479.80 to $796.25, trading around $660 to $664 per share, up 10.39% year-to-date and 8.64% over the year [6] Group 3: Salesforce Inc. (CRM) - Salesforce reported third-quarter FY25 earnings of $9.44 billion in revenue and $2.41 per share, raising FY25 revenue guidance to $38 billion with a 20% operating margin [6] - The company is focusing on Agentforce AI, with 200 deals signed and plans to hire 1,400 AI-focused sales representatives [6] - CRM stock performance was positively received by retail investors following the earnings report [6] Group 4: UiPath Inc. (PATH) - UiPath reported third-quarter FY25 earnings of $355 million in revenue and a non-GAAP EPS of $0.11, with annual recurring revenue (ARR) growth to $1.61 billion and a 113% net retention rate [11] - The stock had a 52-week range of $9.38 to $18.74, trading around $18 to $20 per share, up 42.92% year-to-date and 23.61% over the year [10] - Investors reacted positively to PATH's innovative AI developments and partnerships [11] Group 5: Netflix Inc. (NFLX) - NFLX shares fell over 5% after co-founder Reed Hastings sold approximately 375,000 shares for about $40.7 million, raising insider selling concerns [16] - Despite the drop, strong demand for the final season of "Stranger Things" and exclusive negotiations for acquiring Warner Bros. Discovery's assets were notable developments [16] - NFLX stock had a 52-week range of $82.11 to $134.12, trading around $103 to $105 per share, up 16.41% year-to-date and 12.45% over the year [17] Group 6: Tesla Inc. (TSLA) - Tesla's November sales data showed a 10% year-on-year increase in China deliveries, while European sales declined significantly [17] - The stock had a 52-week range of $214.25 to $488.54, trading around $453 to $455 per share, up 19.83% year-to-date and 23.00% over the year [19] - Regulatory changes proposed by President Trump could ease EV mandates, potentially benefiting Tesla's inventory clearance [17]

We recently published 10 Stocks Sparking Massive Fortunes. UiPath Inc. (NYSE:PATH) is one of the best performers on Friday. UiPath soared 34.7 percent week-on-week to hit a 19-month high, as investors took heart from a stellar earnings performance in the third quarter of fiscal year 2026. In an updated report, UiPath Inc. (NYSE:PATH) said it swung to a net income of $198.8 million from a $10.6 million net loss in the same period last year. UiPath (PATH) Climbs 35% to New Record High on Stellar Q3 Reven ...

We recently published 10 Stocks With Effortless 14-25% Gains. UiPath Inc. (NYSE:PATH) is one of the best performers on Thursday. UiPath extended its winning streak to a fifth straight session on Thursday, to nearly hit its 52-week price, as investors took heart from an impressive earnings performance in the third quarter of fiscal year 2026. At intra-day trading, UiPath Inc. (NYSE:PATH) soared to its highest price of $18.70—just 4 cents shy of its 52-week high of $18.74 recorded on October 5. In an upda ...

Group 1: Meta's Strategic Shift - Meta plans to cut overall spending by approximately 30%, continuing its efficiency initiatives from the previous year [2] - The company intends to increase investment in AI wearables, indicating a strategic focus on on-device intelligence and next-generation hardware [2] - Core priorities now include AR glasses, multimodal AI assistants, and spatial computing experiences, suggesting a significant platform shift is anticipated [3] Group 2: UiPath's Strong Performance - UiPath experienced a surge of over 25% following a strong earnings report that exceeded expectations [4] - Revenue growth accelerated, and Annual Recurring Revenue (ARR) surpassed forecasts, with management noting a rapid increase in demand for AI agents and enterprise automation workflows [4] - The company has shown meaningful margin improvement, indicating a transition from early growth to a more sustainable, profitability-focused phase [6] Group 3: Economic Indicators - The Core PCE report, which is the Federal Reserve's preferred inflation metric, is expected to show continued cooling without entering contraction territory [7] - If the PCE data aligns with or is lower than expectations, it could bolster the case for potential rate cuts next year [9] - A hotter PCE reading could lead to increased volatility across equities, bonds, and cryptocurrencies as markets reassess the timing and magnitude of easing [9]

Core Thesis - UiPath Inc. is facing key-man risk following the appointment of Rob Enslin as co-CEO, which has led to concerns about the founder's focus and overall momentum [2] - Despite challenges, UiPath's market cap stands at $6 billion, trading at over 4x sales, with positive free cash flow per share and potential for strategic growth through agentic automation [2][5] Financial Performance - Revenue has increased by 30% since the initial bullish thesis, indicating strong fundamentals and customer retention [4] - Free cash flow generation has turned positive, reflecting improved operational efficiency [4] Strategic Developments - The launch of UiPath Maestro represents a significant strategic shift, combining AI, automation, and human oversight, which can reduce processing time by up to 75% and manual effort by 60% [4] - Complementary innovations like UiPath Data Fabric and IXP for semantic automation enhance the platform's capabilities [5] Market Position and Competitiveness - UiPath's growth has slowed compared to peers like Palantir, with its DBNR declining from 115% to 108% [3] - The company is not among the 30 most popular stocks among hedge funds, with 42 hedge fund portfolios holding PATH at the end of Q2, a slight increase from the previous quarter [7]