Getting to the Bottom of Uipath’s Plunging Valuation

Getting to the Bottom of Uipath’s Plunging Valuation

UiPath was one of the most liked companies in the world little over a year ago. The business secured a large $750 million round in February, valued at a whopping $35 billion. The robotic process Automation Company, or RPA firm, was on fire. UiPath’s ultimate private pricing seemed a little, well, costly by the time it went public in April of last year. The unicorn’s early IPO price range was lower than its previous valuation, but after raising it and priced beyond it, the unicorn was still valued at a small discount to the $35 billion amount.

However, during its first day of trading, the business managed to surpass the price established by its three-quarters-of-a-billion-dollar round. For extra background, TechCrunch spoke with the company’s CFO about its technique of going public at the time, as well as the date of its launch; the executive lauded the traditional offering’s ability to attract new investors over the trendier direct listing alternative. According to YCharts statistics, UiPath’s value soared to as high as $90 per share, valuing the company at roughly $43 billion.

However, things haven’t gone well for UiPath since then, at least in terms of value, on Friday afternoon, the stock was down almost 3% to $18.29 per share, lowering its market capitalization below $10 billion. What went wrong with UiPath? From a red-hot unicorn to an inconsistent IPO, robust early trading, and a painful decline. TechCrunch proposes two theories: The first is that the firm was caught up in a broader repricing of technology revenues by public-market investors; this isn’t a new tale, and if it explains UiPath’s valuation falls, it would place the technology company in good company. There might, however, be a technological reason at work as well. Of course, both variables might be at work at the same time.

Let’s discuss numbers first, then riff on the tech side of the coin to figure out what happened with UiPath’s decreasing valuation! Is it possible that UiPath has been damaged by the market’s technology repricing? UiPath is still a growing firm. The RPA market leader announced overall sales of $289.7 million and quarterly annual recurring revenue (ARR) of $925.3 million in the fourth quarter of fiscal 2022 — in English, the three months ending January 31, 2022. You can observe how the public markets have altered their minds about the worth of software income based on those data points.