UiPath (NYSE: PATH) stock plunged during intraday trading Thursday following an unexpected CEO shakeup and a lower-than-expected Q2 sales guidance.
UiPath, a leading automation software company, announced that CEO Rob Enslin will step down on June 1. Enslin’s departure comes amidst a period where UiPath shares have experienced a decline of approximately 20% since he assumed sole leadership.
Replacing Enslin is co-founder Daniel Dines, who previously served as co-CEO until his resignation on January 31. Dines, who co-founded UiPath in 2005 alongside Marius Tirca, expressed eagerness to reassume the CEO role, stating,
“With this change, I’m excited to step back into the CEO role, and I am looking forward to leading the company through our next phase of profitable growth and innovation.”
The leadership transition coincided with the release of UiPath’s quarterly results. The company reported earnings per share of 13 cents, beating analyst estimates of 12 cents. Revenue came in at $335.11 million, slightly above analyst estimates of $333.04 million.
However, the company’s guidance for the current quarter fell short of expectations. The company forecasts revenue to range between $300 million to $305 million, with the upper end of the forecast significantly lower than the $333 million expected by analysts.
Moreover, UiPath revised its full-year guidance downwards. The company now expects net sales for the year to range from $1.405 billion to $1.410 billion, compared to its earlier forecast of $1.555 billion to $1.560 billion.
CFO Ashim Gupta attributed these revisions to increased scrutiny and extended sales cycles for large multi-year deals observed in the first quarter. Gupta also cited the prevailing macroeconomic environment and the leadership transition as factors influencing the revised guidance for the remainder of the fiscal year.
UiPath (NYSE: PATH) Stock Price Action
On Thursday, PATH stock plummeted 34.04%, closing at $12.07, marking a 38.39% decrease for the week. The trading volume was 86,410,175 shares, significantly higher than the average daily volume of 8.80 million.
