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PATH · Forward model · Professional services and other · Bear case

What has to happen in Professional services and other

Model as of

This page changes Professional services and other inside the complete PATH model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

PATH forward model
Horizon
Consolidated fair value $14.18 all other verticals held in this portfolio case
Final-quarter revenue $19M 3% of company revenue
Explicit segment contribution −$267M EBITDA less segment capex, before corporate items

Management guided its own next quarter DOWN in the release that printed the beat: $395m to $400m against the $418.4m just delivered, a 5.5% sequential decline and +10.4% year over year against the +17% just reported. It raised the full year by $22m, which is the $20.9m first-quarter beat passed through plus $1.1m - it did not raise the remaining three quarters at all. Underneath, the recurring machine is not accelerating: net new ARR of $49m in the basis quarter compares with $45.0m in the same quarter of fiscal 2024 on an ARR base 52% larger, and annual net new ARR has gone $260m, $202m, $186m over three years. This case takes revenue 0.6% a quarter below the base, cuts margins two points and exits at 3.0x, which is what a decelerating on-premise-heavy licence line has historically been worth. It lands at $14.18, 21.9% below the tape - close to where twenty analysts polled by S&P Global sit, at an average target of $13.44 against an $18.15 close.

Professional services and other

Basis quarter$16M
Final quarter$19M
Implied CAGR+3%
Final revenue mix3%

3.9% of revenue and a deliberate loss leader. UiPath booked $16.2m of professional services and other revenue in the basis quarter against $31.3m of cost of revenue on the same line - a gross margin of negative 93% before a dollar of operating expense. The line grew 46.5% year over year as delivery was staffed for the agentic product set and for the Peak AI and WorkFusion acquisitions. It sits explicitly outside the ARR definition, so it has no operational driver: no hours, no bill rate and no delivery headcount are disclosed at any frequency. A decaying growth rate is the only shape the disclosure supports, and its negative margin is the reason the platform line must carry 29.5% for the consolidated figure to land on the 24% operating margin UiPath guides.

Last four quarters
2026 Q2 $11M Reported
2026 Q3 $13M Reported
2026 Q4 $14M Reported
2027 Q1 $16M Reported
Professional services, training and other
Sequential growth +2.0%/qtr decaying toward +1.0% 2.0% a quarter, well below the 15.8% sequential and 46.5% year-over-year just printed. Delivery staffing cannot compound at that rate.
Professional services and other

Latest: $19M (2032Q1E)

Period Value
2024Q1 $9M
2024Q2 $8M
2024Q3 $10M
2024Q4 $9M
2025Q1 $10M
2025Q2 $9M
2025Q3 $11M
2025Q4 $11M
2026Q1 $11M
2026Q2 $11M
2026Q3 $13M
2026Q4 $14M
2027Q1 $16M
2027Q2E $16M
2027Q3E $17M
2027Q4E $17M
2028Q1E $17M
2028Q2E $17M
2028Q3E $17M
2028Q4E $17M
2029Q1E $18M
2029Q2E $18M
2029Q3E $18M
2029Q4E $18M
2030Q1E $18M
2030Q2E $18M
2030Q3E $18M
2030Q4E $19M
2031Q1E $19M
2031Q2E $19M
2031Q3E $19M
2031Q4E $19M
2032Q1E $19M

Assumptions & reasoning

  • Read straight off the Professional services and other line of the filed condensed consolidated statements of operations in each quarter's own 8-K exhibit 99.1. Nothing here is apportioned or estimated.
  • ASEASONAL by measurement, which is a finding rather than a gap. Ratio to a centred four-quarter moving average gives 1.0016 / 0.9393 / 1.0626 / 0.9965, a 12.3-point signal - but the October factor's own window-to-window spread is 8.7 points, 71% of the signal, and there is no recognition or delivery calendar to explain a shape. On a line that is 3.9% of revenue, encoding that would move consolidated revenue by less than half a point while asserting something the data does not support.
  • The negative EBITDA margin is not an artefact. Cost of professional services and other exceeded the revenue of that line in every quarter of the thirteen-quarter history: negative 93% in the basis quarter, negative 117% across fiscal 2026, negative 74% across fiscal 2025 and negative 100% across fiscal 2024.
  • Upside the model does not carry: if UiPath pushed delivery to partners the way Okta has, this line would shrink and the consolidated margin would improve faster than modelled. Nothing in the filings says it intends to.
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