UiPath, Inc. 10-K

Item 8. Financial Statements and Supplementary Data INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm (PCAOB ID Number 185 ) 76 Consolidated Balance Sheets 78 Consolidated Statements of Operations 79 Consolidated Statements of Comprehensive Income (Loss) 80 Consolidated Statements of Stockholders' Equity 81 Consolidated Statements of Cash Flows 82 Notes to Consolidated Financial Statements 83 75 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors UiPath, Inc.: Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting We have audited the accompanying consolidated balance sheets of UiPath, Inc. and subsidiaries (the Company) as of January 31, 2026 and 2025, the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended January 31, 2026, and the related notes (collectively, the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 31, 2026 and 2025, and the results of its operations and its cash flows for each of the years in the three-year period ended January 31, 2026, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 31, 2026 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Basis for Opinions The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. 76 Table of Contents Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Revenue Recognition - Assessment of Terms and Conditions in Certain Contracts As discussed in Note 2 to the consolidated financial statements, the Company derives revenue primarily from term licenses, maintenance and support services, SaaS products, and professional services. For contracts with multiple performance obligations, management allocates the transaction price of the contract to each performance obligation and recognizes revenue when, or as, a performance obligation is satisfied. Management applies judgment in identifying and evaluating any terms and conditions in contracts that may impact revenue recognition. For the year ended January 31, 2026, the Company recorded revenue of $1.61 billion. We identified the assessment of terms and conditions in certain contracts as a critical audit matter. Specifically, complex auditor judgment was required in assessing the Company’s identification and evaluation of terms and conditions in certain contracts because of the complex accounting guidance, primarily related to the sale of term licenses. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls within the related revenue recognition process, including a control related to the identification and evaluation of terms and conditions in certain contracts that impact revenue recognition. For a selection of contracts, we assessed the terms and conditions in the contracts by examining the contracts and evaluating management’s determination of the impact of those terms and conditions on revenue recognition. For each of these contracts selected, we also assessed the impact of identified non-standard terms and conditions to recorded revenue by determining the revenue to be recorded in the current period using the terms and conditions in the underlying contract and comparing it to the Company’s recorded balances. /s/ KPMG LLP We have served as the Company’s auditor since 2022. New York, New York March 24, 2026 77 Table of Contents UiPath, Inc. Consolidated Balance Sheets Amounts in thousands except per share data As of January 31, 2026 2025 ASSETS Current assets Cash and cash equivalents $ 871,157 $ 879,196 Restricted cash 438 438 Marketable securities 601,329 750,322 Accounts receivable, net of allowance for credit losses of $ 5,222 and $ 1,642 , respectively 488,265 451,131 Contract assets 92,440 88,735 Deferred contract acquisition costs 84,739 82,461 Prepaid expenses and other current assets 105,577 86,276 Total current assets 2,243,945 2,338,559 Marketable securities, non-current 216,990 94,113 Contract assets, non-current 1,946 3,447 Deferred contract acquisition costs, non-current 153,708 139,341 Property and equipment, net 46,014 32,740 Operating lease right-of-use assets 64,472 66,500 Intangible assets, net 19,989 7,905 Goodwill 125,310 87,304 Deferred tax assets 233,401 27,963 Other assets, non-current 73,425 67,398 Total assets $ 3,179,200 $ 2,865,270 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable $ 10,161 $ 33,178 Accrued expenses and other current liabilities 170,496 83,923 Accrued compensation and employee benefits 121,029 112,355 Deferred revenue 603,737 569,464 Total current liabilities 905,423 798,920 Deferred revenue, non-current 103,568 135,843 Operating lease liabilities, non-current 70,940 74,230 Other liabilities, non-current 16,682 10,515 Total liabilities 1,096,613 1,019,508 Commitments and contingencies (Note 10) Stockholders’ equity: Preferred stock, $ 0.00001 par value per share, 20,000 shares authorized; none issued and outstanding — — Class A common stock, $ 0.00001 par value per share, 2,000,000 shares authorized; 540,898 and 508,680 shares issued, respectively; 472,346 and 471,059 shares outstanding, respectively 5 5 Class B common stock, $ 0.00001 par value per share, 115,741 shares authorized; 64,691 and 82,453 shares issued and outstanding, respectively 1 1 Treasury stock, at cost, 68,552 and 37,621 shares, respectively ( 833,905 ) ( 494,779 ) Additional paid-in capital 4,585,430 4,333,300 Accumulated other comprehensive income (loss) 36,601 ( 4,890 ) Accumulated deficit ( 1,705,545 ) ( 1,987,875 ) Total stockholders’ equity 2,082,587 1,845,762 Total liabilities and stockholders’ equity $ 3,179,200 $ 2,865,270 The accompanying notes are an integral part of these consolidated financial statements. 78 Table of Contents UiPath, Inc. Consolidated Statements of Operations Amounts in thousands except per share data Year Ended January 31, 2026 2025 2024 Revenue: Licenses $ 606,394 $ 587,162 $ 621,392 Subscription services 954,472 801,947 649,918 Professional services and other 49,706 40,555 36,762 Total revenue 1,610,572 1,429,664 1,308,072 Cost of revenue: Licenses 5,334 8,565 10,469 Subscription services 157,588 167,630 111,922 Professional services and other 108,062 70,747 73,533 Total cost of revenue 270,984 246,942 195,924 Gross profit 1,339,588 1,182,722 1,112,148 Operating expenses: Sales and marketing 683,329 738,493 713,130 Research and development 385,208 380,682 332,101 General and administrative 214,291 226,116 231,637 Total operating expenses 1,282,828 1,345,291 1,276,868 Operating income (loss) 56,760 ( 162,569 ) ( 164,720 ) Interest income 48,023 49,422 57,130 Other (expense) income, net ( 4,155 ) 35,047 31,775 Income (loss) before income taxes 100,628 ( 78,100 ) ( 75,815 ) (Benefit from) provision for income taxes ( 181,702 ) ( 4,406 ) 14,068 Net income (loss) $ 282,330 $ ( 73,694 ) $ ( 89,883 ) Net income (loss) per share, basic $ 0.52 $ ( 0.13 ) $ ( 0.16 ) Net income (loss) per share, diluted $ 0.52 $ ( 0.13 ) $ ( 0.16 ) Weighted-average shares used in computing net income (loss) per share, basic 538,125 559,933 563,855 Weighted-average shares used in computing net income (loss) per share, diluted 544,860 559,933 563,855 The accompanying notes are an integral part of these consolidated financial statements. 79 Table of Contents UiPath, Inc. Consolidated Statements of Comprehensive Income (Loss) Amounts in thousands Year Ended January 31, 2026 2025 2024 Net income (loss) $ 282,330 $ ( 73,694 ) $ ( 89,883 ) Other comprehensive income (loss), net of tax: Unrealized gain (loss) on available-for-sale marketable securities, net 717 ( 272 ) 519 Foreign currency translation adjustments, net 40,774 ( 13,443 ) 694 Other comprehensive income (loss), net 41,491 ( 13,715 ) 1,213 Comprehensive income (loss) $ 323,821 $ ( 87,409 ) $ ( 88,670 ) The accompanying notes are an integral part of these consolidated financial statements. 80 Table of Contents UiPath, Inc. Consolidated Statements of Stockholders’ Equity Amounts in thousands Common stock Treasury stock Additional paid-in capital Accumulated other comprehensive income (loss) Accumulated deficit Total stockholders’ equity Class A Class B Shares Amount Shares Amount Shares Amount Amount Amount Amount Amount Balance as of January 31, 2023 474,160 $ 5 82,453 $ 1 — $ — $ 3,736,838 $ 7,612 $ ( 1,824,298 ) $ 1,920,158 Issuance of common stock upon exercise of stock options 5,221 — — — — — 6,728 — — 6,728 Vesting of early exercised stock options — — — — — — 2 — — 2 Issuance of common stock upon settlement of restricted stock units 17,695 — — — — — — — — — Tax withholdings on settlement of restricted stock units ( 6,061 ) — — — — — ( 113,162 ) — — ( 113,162 ) Charitable donation of Class A common stock 281 — — — — — 4,215 — — 4,215 Repurchase of Class A common stock — — — — ( 5,840 ) ( 102,615 ) — — — ( 102,615 ) Issuance of common stock under employee stock purchase plan 1,364 — — — — — 17,313 — — 17,313 Stock-based compensation — — — — — — 372,145 — — 372,145 Other comprehensive income, net of tax — — — — — — — 1,213 — 1,213 Net loss — — — — — — — — ( 89,883 ) ( 89,883 ) Balance as of January 31, 2024 492,660 $ 5 82,453 $ 1 ( 5,840 ) $ ( 102,615 ) $ 4,024,079 $ 8,825 $ ( 1,914,181 ) $ 2,016,114 Issuance of common stock upon exercise of stock options 4,002 — — — — — 8,032 — — 8,032 Vesting of early exercised stock options — — — — — — 2 — — 2 Issuance of common stock upon settlement of restricted stock units 15,357 — — — — — — — — — Tax withholdings on settlement of restricted stock units ( 5,170 ) — — — — — ( 79,299 ) — — ( 79,299 ) Charitable donation of Class A common stock 281 — — — — — 6,564 — — 6,564 Repurchase of Class A common stock — — — — ( 31,781 ) ( 392,164 ) — — — ( 392,164 ) Issuance of common stock under employee stock purchase plan 1,550 — — — — — 15,708 — — 15,708 Stock-based compensation — — — — — — 358,214 — — 358,214 Other comprehensive loss, net of tax — — — — — — — ( 13,715 ) — ( 13,715 ) Net loss — — — — — — — — ( 73,694 ) ( 73,694 ) Balance as of January 31, 2025 508,680 $ 5 82,453 $ 1 ( 37,621 ) $ ( 494,779 ) $ 4,333,300 $ ( 4,890 ) $ ( 1,987,875 ) $ 1,845,762 Issuance of common stock upon exercise of stock options 3,697 — — — — — 1,056 — — 1,056 Conversion of Class B common stock into Class A common stock 17,762 — ( 17,762 ) — — — — — — — Issuance of common stock upon settlement of restricted stock units 13,575 — — — — — — — — — Tax withholdings on settlement of restricted stock units ( 4,468 ) — — — — — ( 59,081 ) — — ( 59,081 ) Charitable donation of Class A common stock 281 — — — — — 4,187 — — 4,187 Repurchase of Class A common stock — — — — ( 30,931 ) ( 339,126 ) — — — ( 339,126 ) Issuance of common stock under employee stock purchase plan 1,371 — — — — — 15,289 — — 15,289 Stock-based compensation — — — — — — 290,679 — — 290,679 Other comprehensive income, net of tax — — — — — — — 41,491 — 41,491 Net income — — — — — — — — 282,330 282,330 Balance as of January 31, 2026 540,898 $ 5 64,691 $ 1 ( 68,552 ) $ ( 833,905 ) $ 4,585,430 $ 36,601 $ ( 1,705,545 ) $ 2,082,587 The accompanying notes are an integral part of these consolidated financial statements. 81 Table of Contents UiPath, Inc. Consolidated Statements of Cash Flows Amounts in thousands Year Ended January 31, 2026 2025 2024 Cash flows from operating activities: Net income (loss) $ 282,330 $ ( 73,694 ) $ ( 89,883 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 16,969 17,232 22,597 Amortization of deferred contract acquisition costs 109,362 92,089 75,471 Net accretion on marketable securities ( 10,236 ) ( 31,778 ) ( 28,246 ) Stock-based compensation expense 290,676 358,151 371,955 Charitable donation of Class A common stock 4,187 6,564 4,215 Non-cash operating lease expense 16,976 15,899 13,047 (Benefit from) provision for deferred income taxes ( 202,682 ) ( 19,794 ) 554 Credit loss expense (benefit) (1) 5,735 1,979 ( 1,579 ) Other non-cash charges (credits), net 7,098 ( 4,311 ) ( 2,121 ) Changes in operating assets and liabilities: Accounts receivable ( 25,802 ) ( 22,173 ) ( 64,217 ) Contract assets 3,208 ( 3,991 ) ( 14,694 ) Deferred contract acquisition costs ( 116,202 ) ( 89,157 ) ( 118,833 ) Prepaid expenses and other assets ( 3,933 ) 7,065 4,222 Accounts payable ( 21,675 ) 27,856 ( 5,052 ) Accrued expenses and other liabilities 46,697 9,235 11,804 Accrued compensation and employee benefits 2,583 ( 23,428 ) ( 4,039 ) Operating lease liabilities, net ( 11,652 ) ( 15,527 ) ( 13,590 ) Deferred revenue ( 22,431 ) 68,348 137,471 Net cash provided by operating activities 371,208 320,565 299,082 Cash flows from investing activities: Purchases of marketable securities ( 772,491 ) ( 1,470,355 ) ( 1,485,965 ) Maturities of marketable securities 809,247 1,475,584 1,050,984 Purchases of property and equipment ( 19,048 ) ( 14,923 ) ( 7,342 ) Payments related to business acquisitions, net of cash acquired ( 24,821 ) — — Other investing, net (1) ( 15,353 ) ( 35,809 ) 2,754 Net cash used in investing activities ( 22,466 ) ( 45,503 ) ( 439,569 ) Cash flows from financing activities: Repurchases of Class A common stock ( 329,101 ) ( 390,751 ) ( 102,615 ) Proceeds from exercise of stock options 1,056 8,032 6,740 Payments of tax withholdings on net settlement of equity awards (1) ( 59,061 ) ( 77,831 ) ( 112,712 ) Proceeds from employee stock purchase plan contributions 14,859 15,605 17,555 Payments of deferred or contingent consideration related to business acquisitions ( 128 ) ( 5,570 ) ( 5,863 ) Net cash used in financing activities ( 372,375 ) ( 450,515 ) ( 196,895 ) Effect of exchange rate changes 15,594 ( 7,029 ) ( 2,621 ) Net decrease in cash, cash equivalents, and restricted cash ( 8,039 ) ( 182,482 ) ( 340,003 ) Cash, cash equivalents, and restricted cash at beginning of period 879,634 1,062,116 1,402,119 Cash, cash equivalents, and restricted cash at end of period $ 871,595 $ 879,634 $ 1,062,116 Supplemental disclosures of cash flow information: Cash paid for interest $ — $ 309 $ 563 Cash paid for income taxes, net 9,812 16,709 10,822 Supplemental disclosures of non-cash investing and financing activities: Deferred and contingent consideration recognized in connection with business acquisition $ 9,835 $ — $ — Tax withholdings on net settlement of restricted stock units, accrued but not yet paid 4,724 4,674 3,354 Property and equipment purchases included in accounts payable 58 2,897 511 Payable for repurchase of Class A common stock 10,015 — — (1) Prior period amounts have been expanded or aggregated to conform to current period presentation The accompanying notes are an integral part of these consolidated financial statements. 82 UiPath, Inc. Notes to Consolidated Financial Statements 01 Organization and Description of Business UiPath, Inc. (the “Company,” “we,” “us,” or “our”) was incorporated in Delaware in June 2015, is headquartered in New York, New York, and has legal prese nce in 30 countries, with principal operations in t he U.S., R omania, and Japan. The UiPath Platform™ uniquely combines controlled agency, developer flexibility, and seamless integration to help organizations scale agentic automation safely and confidently. Committed to security, governance, and interoperability, UiPath supports enterprises as they transition into a future where automation delivers on the full potential of AI to transform industries. Our platform empowers customers to combine automation, AI agents, and people, delivering end-to-end process orchestration that drives innovation. 02 Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP and include the financial statements of UiPath, Inc. and its subsidiaries in which we hold a controlling financial interest. Intercompany transactions and accounts have been eliminated in consolidation. Fiscal Year Our fiscal year ends on January 31. References to fiscal years 2026, 2025, and 2024 refer to the fiscal years ended January 31, 2026, 2025, and 2024, respectively. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities at the balance sheet date and the amounts of revenue and expenses reported during the period. We evaluate estimates based on historical and anticipated results, trends, and various other assumptions. Such estimates include, but are not limited to, certain aspects of revenue recognition, expected period of benefit for deferred contract acquisition costs, allowance for credit losses, fair value of financial assets and liabilities, fair value of acquired assets and assumed liabilities, useful lives of long-lived assets, capitalized software development and internal-use software costs, carrying value of operating lease ROU assets and operating lease liabilities, incremental borrowing rates for operating leases, amount of stock-based compensation expense, amount of self-insurance liability, timing and amount of contingencies, costs related to restructuring actions, uncertain tax positions, and valuation allowance for deferred income taxes. Actual results could differ from these estimates and assumptions. Foreign Currency The functional currency of our non-U.S. subsidiaries is the local currency. Asset and liability balances denominated in non-U.S. dollar currencies are translated into U.S. dollars using period-end exchange rates, while revenue and expenses are translated using the average monthly exchange rates. Differences are included in stockholders’ equity as a component of accumulated other comprehensive income (loss). Financial assets and liabilities denominated in currencies other than the functional currency are recorded at the exchange rate at the time of the transaction and subsequent gains and losses related to changes in the foreign currency are included in other income (loss), net in the consolidated statements of operations. For fiscal years 2026, 2025, and 2024, we recognized foreign currency transaction (losses) gains of $( 7.0 ) million, $ 6.9 million, and $ 0.3 million, respectively. 83 UiPath, Inc. Notes to Consolidated Financial Statements Derivative Financial Instruments From time to time, we may use derivative financial instruments, such as foreign currency forward contracts, to manage foreign currency exposures. Derivative instruments are accounted for as either assets or liabilities and carried at fair value. We did not have foreign currency forward contracts during fiscal year 2026, 2025, or 2024. Concentration of Risks Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents, marketable securities, and accounts receivable. We maintain our cash balance at financial institutions that management believes are high-credit, quality financial institutions, where deposits, at times, exceed FDIC limits. As of January 31, 2026 and 2025, 93 % and 86 %, respectively, of our cash and cash equivalents were concentrated in the U.S., EU countries, and Japan. The selection of investments in marketable securities is governed by our investment policy. The policy aims to emphasize principles of safety and liquidity, with the overall objective of earning an attractive rate of return while limiting exposure to risk of loss and avoiding inappropriate concentrations. We use this policy to guide our investment decisions as it stipulates, among other things, a list of eligible investment types, minimum ratings and other restrictions for each type, and overall portfolio composition constraints. With regard to accounts receivable, we extend differing levels of credit to customers based on creditworthiness, do not require collateral deposits, and when necessary maintain an allowance for potential credit losses based upon the expected collectability of accounts receivable. We manage credit risk related to our customers by performing periodic evaluations of creditworthiness and applying other credit risk monitoring procedures. Significant customers are those that represent 10% or more of our total revenue for the period or accounts receivable at the balance sheet date. For fiscal years 2026, 2025, and 2024, no single customer accounted for 10% or more of our total revenue. As of January 31, 2026 and 2025, no single customer accounted for 10% or more of our accounts receivable. Fair Value Measurement We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. We determine fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: Level 1—Quoted prices in active markets for identical assets or liabilities that we can access at the measurement date. Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, such as: • quoted prices for similar assets or liabilities in active markets; • quoted prices for identical or similar assets or liabilities in markets that are not active; or • inputs other than quoted prices that are observable or can be corroborated by observable market data. Level 2 inputs must be observable for substantially the full term of the asset or liability. Level 3—Unobservable inputs for the asset or liability that are supported by little or no market activity and that are significant to the fair value. Marketable securities and other investments and contingent consideration are measured at fair value. Cash equivalents, accounts receivable, and accounts payable are recognized at their carrying value, which approximates fair value due to the short time to the expected receipt or payment date. 84 UiPath, Inc. Notes to Consolidated Financial Statements Cash and Cash Equivalents We consider all highly liquid investments purchased with original maturity dates of three months or less to be cash equivalents. Marketable Securities Our marketable securities consist primarily of treasury bills and U.S. government securities, corporate bonds, and commercial paper with original maturity dates of more than three months from the date of purchase. We determine the appropriate classification of our marketable securities at the time of purchase and reevaluate such designation at each balance sheet date. We have classified and accounted for our marketable securities as available-for-sale securities based on our intentions with regard to these instruments, and we classify them as current or non-current assets in the consolidated balance sheets based on their stated maturity dates. The fair value of available-for-sale marketable securities is remeasured each reporting period. Any premium or discount is amortized or accreted over the life of the related available-for-sale security as an adjustment to yield. Interest income is recognized when earned. Unrealized gains and losses on marketable securities are reported as a separate component of accumulated other comprehensive income (loss) on the consolidated balance sheets until realized. We evaluate an available-for-sale debt security for impairment if the estimated fair value is below its amortized cost basis. We consider our intent to sell the security or whether it is more likely than not that we will be required to sell the security before recovery of its amortized basis. If either of these conditions exist, the debt security’s amortized cost basis is written down to fair value, with the change recognized in other (expense) income, net in the consolidated statements of operations. If neither of these conditions are present, we evaluate whether unrealized losses have resulted from a credit loss or other factors. To determine whether a decline in value is related to credit loss, we evaluate, among other factors, the extent to which the fair value is less than the amortized cost basis and any adverse conditions specifically related to an issuer of a security or its industry. Credit-related unrealized losses are recognized as an allowance on the consolidated balance sheets with a corresponding charge to other (expense) income, net in the consolidated statements of operations. As of January 31, 2026 and 2025 we had not recorded any allowance for credit losses related to our available-for-sale marketable securities, and we did not record any impairments related to these securities in fiscal year 2026, 2025, or 2024. Accounts Receivable and Allowance for Credit Losses Accounts receivable consist of amounts billed and currently due from customers, which are subject to collection risk. Our accounts receivable are reduced by an allowance for credit losses. This allowance contemplates estimated losses resulting from the inability of our customers to make required payments. It is an estimate and is regularly evaluated for adequacy by taking into consideration a combination of factors such as historical write-off experience, credit quality of the customer, age of the receivable balance, current economic conditions and forecasts of future economic conditions, and projections of future collections. We write off accounts receivable when they are determined to be uncollectible. The allowance for credit losses was $ 5.2 million and $ 1.6 million as of January 31, 2026 and 2025, respectively. Credit loss expense (recovery) was $ 5.7 million, $ 2.0 million, and $( 1.6 ) million for fiscal years 2026, 2025, and 2024, respectively. Property and Equipment, Net Property and equipment are recorded at historical cost, less accumulated depreciation. Property and equipment are depreciated on a straight-line basis over the estimated useful lives of the assets. Useful lives by asset category are as follows as of January 31, 2026: Asset Category Estimated Useful Life Computer and equipment 1 to 2 years Furniture and fixtures 2 to 10 years Leasehold improvements Shorter of remaining lease term or estimated useful life ( 1 to 12 years) 85 UiPath, Inc. Notes to Consolidated Financial Statements Internal-Use Software Pursuant to ASC 350-40, Internal Use Software , we capitalize costs incurred to implement cloud computing arrangements that are service contracts and costs incurred to develop internal-use software, which has historically included our SaaS products. ASC 350-40 prescribes capitalization of costs incurred during the application development stage, costs incurred to develop or obtain software that allows for access to or conversion of old data by new systems, and costs incurred in connection with upgrades and enhancements to internal-use software if it is probable that such expenditures will result in additional functionality. These capitalized costs exclude training costs, project management costs, and data migration costs. We evaluate our long-lived assets, including these capitalized costs, for indicators of possible impairment when events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. We have broadly marketed on-premises versions of certain of our SaaS products, thereby establishing a pattern of marketing internal-use software and a rebuttable presumption that we intend to market any SaaS products we develop. As a result, our ongoing and future SaaS projects are accounted for under ASC 985-20, Costs of Software to be Sold, Leased or Marketed, which is discussed below under "Software Development Costs." Costs previously capitalized under ASC 350-40 in connection with development of our SaaS products are amortized on a straight-line basis over the product’s estimated useful life of five years and such amortization is included in cost of subscription services revenue on the consolidated statements of operations. Capitalized costs include salaries, benefits, and stock-based compensation charges for employees that are directly involved in developing our SaaS products. These capitalized costs are included in other assets, non-current on the consolidated balance sheets. Gross capitalized internal-use software development costs were $ 7.6 million and $ 7.4 million as of January 31, 2026 and 2025, respectively. Amortization expense was $ 1.0 million, $ 1.3 million, and $ 1.3 million for fiscal years 2026, 2025, and 2024, respectively. Accumulated amortization was $ 6.7 million and $ 5.5 million as of January 31, 2026 and 2025, respectively. Capitalized costs related to the implementation of cloud computing arrangements that are service contracts are amortized on a straight-line basis over the terms of the associated hosting arrangements and such amortization is included in operating expenses in the same line item on the consolidated statements of operations as the associated hosting arrangement fees. These gross capitalized costs were $ 12.7 million and $ 12.1 million as of January 31, 2026 and 2025, respectively, and are recorded in other assets, non-current on our consolidated balance sheets. Related amortization expense was $ 1.6 million, $ 0.3 million, and none for fiscal years 2026, 2025, and 2024, respectively. Accumulated amortization was $ 4.2 million and $ 2.4 million as of January 31, 2026 and 2025, respectively. Software Development Costs We account for costs incurred to develop software to be licensed in accordance with ASC 985-20, Costs of Software to be Sold, Leased or Marketed. These costs include internal development costs and license fees paid to third parties for their software that is integrated into our products. Costs to establish technological feasibility are expensed as incurred. Technological feasibility is established when a working model is complete. Costs incurred subsequent to establishment of technological feasibility are capitalized until the product is available for general release to customers, at which point they are amortized on a product-by-product basis. Management evaluates the useful life of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact their recoverability. Our internal development costs are amortized over the estimated useful life of the software, which is five years , on a straight-line basis, and such amortization is included in cost of licenses revenue or cost of subscription services revenue in the consolidated statements of operations based on the nature of the underlying product. Capitalized costs include salaries, benefits, and stock-based compensation charges for employees that are directly involved in developing our products. Capitalized costs are included in other assets, non-current on the consolidated balance sheets and were immaterial as of January 31, 2026 and 2025. Capitalized license fees paid to third parties are amortized over the license term at the greater of a straight-line or a consumption basis and such amortization is included in cost of licenses revenue or cost of subscription services revenue in the consolidated statements of operations based on the nature of the underlying third-party product. Capitalized costs are included in prepaid expenses and other current assets and other assets, non-current on the consolidated balance sheets and were immaterial as of January 31, 2026 and 2025. 86 UiPath, Inc. Notes to Consolidated Financial Statements Leases We determine if an arrangement contains a lease at inception based on whether there is an identified asset and whether we control the use of the identified asset throughout the period of use. We classify leases as either financing or operating leases. We do not have any financing leases. Operating lease liabilities represent our obligation to make payments arising from a lease. Operating lease liabilities are recognized at the lease commencement date based on the present value of future lease payments over the lease term. The present value of lease payments is discounted based on our incremental borrowing rate unless the rate implicit in the lease is readily determinable, which generally is not the case. We estimate our incremental borrowing rate based on information available at the lease commencement date for collateralized borrowings with a similar term, amount, borrower creditworthiness, and economic environment. Operating lease ROU assets represent our right to use an underlying asset for the lease term. Our operating lease ROU assets are measured based on the corresponding operating lease liability adjusted for (1) payments made to the lessor at or before the commencement date, (2) initial direct costs incurred, and (3) tenant incentives under the lease. Options to renew or terminate the lease are recognized as part of our operating lease ROU assets and operating lease liabilities when it is reasonably certain the options will be exercised. We have elected to not separate lease and non-lease components for any leases within our existing classes of assets. Operating lease expense for fixed lease payments is recognized on a straight-line basis over the lease term. Variable lease payments for real estate taxes, insurance, maintenance, and utilities, which are generally based on our pro-rata share of the total property, are expensed as incurred and are not included in the measurement of the operating lease ROU assets or operating lease liabilities. In addition, we do not recognize ROU assets and lease liabilities for short-term leases which have a lease term of 12 months or less and do not include an option to purchase the underlying asset that we are reasonably certain to exercise. Lease cost for short-term leases is recognized on a straight-line basis over the lease term. Business Acquisitions Assets acquired and liabilities assumed in a business combination are recorded at their respective fair values at the date of the acquisition in accordance with ASC 805, Business Combinations (with the exception of contract assets and contract liabilities, which are measured according to ASC 606, Revenue from Contracts with Customers, discussed under the heading "Revenue Recognition," below). Determination of the fair value of assets acquired, liabilities assumed, and contingent consideration liabilities recognized relies on management judgments and often involves the use of estimates and assumptions, including but not limited to assumptions about future cash inflows and outflows, discount rates, and lives of intangible and other assets. Any excess of the purchase price over the fair value of the net assets acquired is recognized as goodwill. During the one-year measurement period following an acquisition, we may record adjustments to the fair value of the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, subsequent adjustments, if any, are recorded in our consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. Goodwill and Acquired Intangible Assets Goodwill represents the excess of the purchase price in a business acquisition over the fair value of the net assets acquired and is not amortized. We test goodwill for impairment at the reporting unit level at least annually in November and may test more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. At the time of testing, if we determine that it is more likely than not that the estimated fair value of our single reporting unit is less than its carrying value, a quantitative assessment is performed by comparing the fair value of the reporting unit with its carrying value. In order to make this determination, we may make an initial assessment of 87 UiPath, Inc. Notes to Consolidated Financial Statements qualitative factors, or may proceed directly to the quantitative impairment test. There were no impairment charges to goodwill during fiscal years 2026, 2025, and 2024. Acquired intangible assets consist primarily of developed technology and customer relationships resulting from our business acquisitions. Intangible assets are recorded at fair value on the date of acquisition and are amortized over their estimated useful lives. Impairment of Long-Lived Assets We evaluate our long-lived assets for indicators of possible impairment when events or changes in circumstances suggest that the carrying amount of an asset or asset group may not be recoverable. We assess recoverability by comparing the carrying amount of such asset or asset group to the net undiscounted future cash flows we expect the asset or asset group to generate. If the carrying amount of an asset or asset group exceeds the related undiscounted cash flows, it is considered to be impaired and an impairment charge is recognized for the amount by which the carrying value of the asset or asset group exceeds its fair value. There were no events or changes in circumstances during fiscal year 2026, 2025, or 2024 which indicated potential impairment of our long-lived assets. Revenue Recognition We derive revenue from the sale of: (1) software licenses for on-premises use of our proprietary software and related maintenance and support; (2) the right to access certain software products we host (i.e., SaaS); and (3) professional services. For many of our products that are available both on-premises and via SaaS, we sell a single offering that allows customers the choice of either on-premises or SaaS deployment throughout the term of the contract. These offerings are comprised of three types of performance obligations: term license, maintenance and support, and SaaS. In accordance with ASC 606, Revenue from Contracts with Customers , revenue is recognized when or as a customer obtains control of the distinct promised goods and services. The amount of revenue recognized reflects the consideration to which we expect to be entitled in exchange for those goods or services. To achieve the core principle of ASC 606, we apply the following five steps: 1. Identification of the contract, or contracts, with the customer; 2. Identification of the performance obligations in the contract; 3. Determination of the transaction price; 4. Allocation of the transaction price to the performance obligations in the contract; and 5. Recognition of the revenue when, or as, a performance obligation is satisfied. Our significant performance obligations and our application of ASC 606 to each of those performance obligations are discussed in further detail below. Payment terms and conditions vary by contract type, although terms generally require payment within 30 to 60 days of the invoice date. In certain arrangements, we receive payment from a customer either before or after the performance obligation has been satisfied; however, our contracts do not contain a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers or to provide customers with financing. We apply the practical expedient in ASC 606 and do not evaluate payment terms of one year or less for the existence of a significant financing component. Revenue is recorded net of sales tax. We generally do not offer a right of refund in our contracts. Licenses Our term licenses (typically sold as a portion of flexible deployment offerings), provide customers the right to use software for a specified period of time. Revenue for licenses is recognized at the point in time at which the customer is able to use and benefit from the software, which is generally upon delivery to the customer or upon commencement of the renewal term. For licenses revenue, we generally invoice when the license(s) are provided or annually at contract anniversary, which results in a contract asset at contract inception. 88 UiPath, Inc. Notes to Consolidated Financial Statements Subscription Services We generate subscription services revenue through the provision of: (1) maintenance and support, which include technical support and unspecified updates and upgrades on a when-and-if-available basis for our licenses, and (2) SaaS products (typically sold as a portion of flexible deployment offerings). Maintenance and support represent stand-ready obligations for which revenue is recognized ratably over the term of the arrangements. For maintenance and support, we generally invoice when the associated license(s) are provided or annually at contract anniversary, which results in a contract liability at contract inception. Customers do not have the contractual right to take possession of the software underlying our SaaS products. Therefore, SaaS products are stand-ready obligations to provide access to our products, and the related revenue is recognized ratably over the contractual term of the arrangement, as control of the services is transferred to the customer. We generally invoice for our SaaS products when the customer is provided access and may begin using the SaaS products or annually at contract anniversary. Professional Services and Other Professional services and other revenue consists of fees associated with professional services, including deployment of agentic automation, customer education, and training services. Our professional services contracts are structured on a time and materials or fixed price basis, and the related revenue is recognized as the services are rendered. We use a cost-based input method as the measure of progress toward satisfying the performance obligation. For professional services, we invoice as the services are provided, which results in either a contract asset or liability, depending on the timing of the services, or in advance, which results in a contract liability at contract inception. Contracts with Multiple Performance Obligations Most of our contracts with customers contain multiple performance obligations. The transaction price is allocated to the separate performance obligations on a relative SSP basis. Whenever possible, we allocate the transaction price based on observable SSP, which is the price of the same good or service in standalone sales to similar customers in similar circumstances. If observable SSP is not available, we estimate the SSP using data that may include historical prices, discounting practices, list prices, cost data, and other observable inputs. Our SSP reflects the amount we would charge for each performance obligation if it were sold separately in standalone sales to similar customers in similar circumstances in similar geographies. Consideration Payable to Customers From time to time, we enter into arrangements wherein we sell our products and services to a customer or partner while also making commitments to purchase products or services from that customer or partner or make investments to enable that customer or partner to create or enhance their automation practice. These commitments are treated as consideration payable to a customer, and therefore as a reduction to the transaction price, when it is determined that the payment is not in exchange for a distinct good or service that is priced at fair market value. If the consideration payable includes a variable amount, we estimate the transaction price, including assessing whether the estimate of variable consideration must be constrained. We have from time to time offered certain rebate incentives to our partners, which are treated as consideration payable to a customer and therefore accounted for as a reduction to the transaction price of the related revenue arrangements. Modifications We frequently modify contracts to offer customers additional products or services. The additional products and services are generally determined to be distinct from those products or services transferred to the customer before the modification. We evaluate whether the price for the additional products and services reflects the SSP in order to determine the appropriate modification model to apply. If the price reflects SSP, the purchase of additional products and services is accounted for as a separate contract. If the price does not reflect SSP, we account for the modification as the termination of the existing contract and the creation of a new contract. 89 UiPath, Inc. Notes to Consolidated Financial Statements Contract Balances Contract assets consist of unbilled accounts receivable related to goods or services that have been transferred to customers but whose payment is contingent upon future performance. Contract liabilities consist of deferred revenue. Revenue is deferred when we invoice in advance of performance under a contract. Often, certain performance obligations under a contract will be in a contract asset position while other performance obligations under the same contract are in a contract liability position. Contract assets and liabilities pertaining to the same contract are netted in the consolidated balance sheets. Deferred Contract Acquisition Costs We defer sales commissions that are incremental to the acquisition of customer contracts. These costs are recorded as deferred contract acquisition costs on the consolidated balance sheets. We determine whether costs should be deferred based on the terms of our sales compensation and partner incentive plans and whether the commissions are incremental to a customer contract (i.e. would not have occurred absent the customer contract). Under our current sales compensation and certain of our partner incentive plans, commissions for renewals of subscription contracts are not commensurate with the commissions paid on the initial contract. We allocate deferred contract acquisition costs to performance obligations in proportion to the transaction price allocated to each performance obligation and amortize the costs accordingly. Commissions associated with licenses and license renewals are expensed at the time the corresponding licenses revenue is recognized. Commissions associated with subscription services are capitalized and amortized on a straight-line basis over a period of five years for initial contracts, reflecting our estimate of the expected period that we will benefit from those commissions. We determine the period of benefit by taking into consideration the length of our customer contracts, retention rate, the technology lifecycle, and other factors. Commissions paid on renewal contracts that are associated with subscription services are capitalized and amortized over the renewal term. We apply the practical expedient in ASC 340-40, Other Assets and Deferred Costs to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been one year or less. We periodically review deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit. There were no impairment losses recorded for fiscal year 2026, 2025, or 2024. Cost of Revenue Licenses Cost of licenses revenue consists of all direct costs to deliver our licenses to customers, amortization of software development costs related to our licenses, and amortization of acquired developed technology. Subscription Services Cost of subscription services revenue consists of personnel-related expenses of our customer support and technical support teams, including salaries and bonuses, stock-based compensation expense, and employee benefit costs. Cost of subscription services revenue also includes third-party consulting services, hosting costs related to our SaaS products, amortization of acquired developed technology and capitalized development costs related to SaaS products, and allocated overhead. Overhead is allocated to cost of subscription services revenue based on applicable headcount. We recognize these expenses as they are incurred. Professional Services and Other Cost of professional services and other revenue primarily consists of personnel-related expenses of our professional services team, including salaries and bonuses, stock-based compensation expense, and employee benefit costs. Cost of professional services and other revenue also includes subcontracted third-party services and allocated overhead. We recognize these expenses as they are incurred. 90 UiPath, Inc. Notes to Consolidated Financial Statements Sales and Marketing Sales and marketing expenses consist primarily of personnel-related expenses associated with our sales and marketing employees and related sales support teams, including salaries and bonuses, stock-based compensation expense, employee benefit costs, sales and partner commissions, marketing events, advertising costs, travel, trade shows, other marketing materials, and allocated overhead. Advertising costs are expensed as incurred and are included in sales and marketing expenses. Such costs were $ 49.8 million, $ 45.9 million, and $ 44.3 million for fiscal years 2026, 2025, and 2024, respectively. Research and Development Research and development expenses consist primarily of personnel-related expenses, including salaries and bonuses, stock-based compensation expense, and employee benefit costs, for our research and development employees, and allocated overhead. Research and development expenditures are expensed as incurred. General and Administrative General and administrative expenses consist primarily of personnel-related expenses, including salaries and bonuses, stock-based compensation expense, and employee benefit costs, associated with our finance, legal, human resources, compliance, and other administrative employees, as well as accounting and legal professional services fees, other corporate-related expenses, and allocated overhead. Stock-Based Compensation We recognize stock-based compensation expense in accordance with the provisions of ASC 718, Compensation—Stock Compensation . ASC 718 requires the measurement and recognition of compensation expense for all stock-based awards made to employees, directors, and non-employees based on the grant date fair value of the awards. The fair value of each stock option is determined using the Black-Scholes pricing model. The fair value of RS Us and RSA s is determined based on the fair value of our Class A common stock on the grant date. The fair value of PSUs that are dependent on the satisfaction of a performance condition is also determined based on the fair value of our Class A common stock on the grant date. The fair value of ESPP awards is determined using the Black-Scholes pricing model. Stock-based compensation expense is included in cost of revenue and operating expenses within our consolidated statements of operations based on the expense classification of the individual earning the award. The fair value of awards with only service-based vesting conditions is recognized as expense over the requisite service period on a straight-line basis. For PSUs dependent on the satisfaction of a performance condition, compensation expense is recognized only when management believes it is probable that the performance condition will be achieved. The fair value of ESPP shares is recognized over the relevant offering period on a straight-line basis. With all award types, we account for forfeitures as they occur. Income Taxes Pursuant to ASC 740, Income Taxes , we account for income taxes using the asset and liability method, whereby DTAs and DTLs are recognized based on temporary differences between the bases used for financial reporting and income tax reporting purposes. Deferred income taxes are provided based on the enacted tax rates and laws that will be in effect at the time such temporary differences are expected to reverse. A valuation allowance is provided for DTAs if it is more likely than not that we will not realize those tax assets through future operations. ASC 740 prescribes a two-step approach to recognizing and measuring uncertain tax positions: (1) evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than 91 UiPath, Inc. Notes to Consolidated Financial Statements not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any; and (2) measure the tax benefit as the largest amount which is more likely than not of being realized and effectively settled. We consider many factors when evaluating and estimating tax positions and tax benefits, which may require periodic adjustments, and which may not accurately reflect actual outcomes. We recognize any interest and penalties related to uncertain tax positions as a component of (benefit from) provision for income taxes in the consolidated statements of operations. Net Income (Loss) Per Share In a period of net income, diluted net income per share is calculated by giving effect to all potentially dilutive securities outstanding for the period (including, but not limited to, unvested RSUs and unexercised stock options under our equity incentive plans, unvested PSUs, and outstanding purchase periods under our ESPP) using the treasury stock method. In a period of net loss, basic and diluted net loss per share is calculated by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is the same as basic net loss per share because potentially dilutive common stock equivalents are anti-dilutive when in a net loss position. All potentially dilutive common stock equivalents were anti-dilutive in fiscal years 2025 and 2024, as we were in a net loss position for these periods. The rights of the holders of our Class A and Class B common stock, including liquidation and dividend rights, are identical except with regard to voting and conversion rights. Accordingly, we present net income (loss) per share for Class A and Class B common stock together. Segment Information Our chief operating decision maker, or CODM , is our CEO. (From the second quarter of fiscal year 2023 through the second quarter of fiscal year 2025, our Co-CEOs acted together as CODM.) The CODM reviews financial information at the consolidated level and manages business activities as one operating and reportable segment. Because the assets of our single reportable segment are presented as total assets on our consolidated balance sheets, no other measure of segment assets is regularly provided to the CODM. Net income (loss), as reported on our consolidated statements of operations, is one of the measures of segment profit or loss used by our CODM to evaluate performance relative to plan, make resource allocation decisions, and monitor profitability trends. 92 UiPath, Inc. Notes to Consolidated Financial Statements Significant Segment Expenses Revenue (the sources of which are described under the heading "Revenue Recognition," above) is reduced by significant expenses regularly provided to the CODM, as well as other segment items, to arrive at net income (loss) for the periods presented as follows (in thousands): Year Ended January 31, 2026 2025 2024 Revenue $ 1,610,572 $ 1,429,664 $ 1,308,072 Significant segment expenses: Adjusted cost of licenses (1) 4,343 5,818 7,098 Adjusted cost of subscription services (1)(2)(3)(4) 139,545 142,654 94,265 Adjusted cost of professional services and other (2)(3)(4) 98,415 59,068 62,248 Adjusted sales and marketing (1)(2)(3)(4) 587,375 583,898 560,009 Adjusted research and development (2)(3)4) 250,012 242,679 210,722 Adjusted general and administrative (1)(2)(3)(4)(5)(6) 161,131 154,965 141,166 Other segment items (7) 308,955 361,393 356,909 Amortization of acquired intangible assets 8,191 6,711 8,600 Interest income ( 48,023 ) ( 49,422 ) ( 57,130 ) (Benefit from) provision for income taxes ( 181,702 ) ( 4,406 ) 14,068 Net income (loss) $ 282,330 $ ( 73,694 ) $ ( 89,883 ) (1) Excludes amortization of acquired intangible assets (2) Excludes stock-based-compensation (3) Excludes employer payroll tax on employee equity transactions (4) Excludes restructuring costs (5) Excludes charitable donation of Class A common stock (6) Excludes change in fair value of contingent consideration (7) Other segment items include stock-based compensation expense; employer payroll tax expense related to employee equity transactions; restructuring costs; Charitable donation of Class A common stock; change in fair value of contingent consideration; and other (expense) income, net. Entity-Wide Disclosures The following table presents our long-lived assets other than financial instruments, net of accumulated depreciation and amortization, by geographic region (in thousands): As of January 31, 2026 2025 U.S. $ 407,804 $ 183,244 U.K. 126,317 75,574 Romania 85,130 86,933 Netherlands 26,822 24,071 Rest of world 30,310 26,449 Total long-lived assets $ 676,383 $ 396,271 Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . ASU No. 2023-09 requires additional tax disclosures, predominantly related to the effective income tax rate reconciliation and income taxes paid. We adopted ASU No. 2023-09 as of January 31, 2026 on a prospective basis and have included the relevant disclosures in Note 1 3 , Income Taxes . Recently Issued Accounting Pronouncements In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures . ASU No. 2024-03 requires additional disclosure on specific expense categories included in the expense captions presented on the statements of operations, and may be applied prospectively or retrospectively. ASU No. 2024-03 is effective for annual reporting periods beginning after December 93 UiPath, Inc. Notes to Consolidated Financial Statements 15, 2026 and for interim reporting periods beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact of this ASU on our consolidated financial statements. In September 2025, the FASB issued ASU No. 2025-06, I ntangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. ASU No. 2025-06 amends certain aspects of the accounting for and disclosure of software costs under ASC 350-40, and is effective for annual reporting periods beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact of this ASU on our consolidated financial statements. 03 Revenue Recognition Disaggregation of Revenue The following table summarizes revenue by geographical region (dollars in thousands): Year Ended January 31, 2026 2025 2024 Amount Percentage of Revenue Amount Percentage of Revenue Amount Percentage of Revenue Americas (1) $ 798,566 50 % $ 695,053 49 % $ 631,923 48 % Europe, Middle East, and Africa 527,752 33 % 457,703 32 % 415,915 32 % Asia-Pacific 284,254 17 % 276,908 19 % 260,234 20 % Total revenue $ 1,610,572 100 % $ 1,429,664 100 % $ 1,308,072 100 % (1) Revenue from the U.S. represented 46 %, 44 %, and 43 % of our total revenues for fiscal years 2026, 2025, and 2024, respectively. Contract Balances Significant changes in our contract assets and deferred revenue balances during the periods presented were as follows (in thousands): Year Ended January 31, Contract Assets 2026 2025 Beginning balance $ 92,182 $ 90,411 Contract assets recognized during the year 89,981 88,862 Amounts transferred to accounts receivable from unbilled accounts receivable presented at the beginning of the year ( 88,735 ) ( 84,197 ) Translation adjustments 958 ( 2,894 ) Ending balance $ 94,386 $ 92,182 Contract assets, current 92,440 88,735 Contract assets, non-current 1,946 3,447 Total contract assets $ 94,386 $ 92,182 94 UiPath, Inc. Notes to Consolidated Financial Statements Year Ended January 31, Deferred Revenue 2026 2025 Beginning balance $ 705,307 $ 647,832 Additions to deferred revenue during the year 1,518,136 1,410,482 Additions to deferred revenue from business acquisitions 3,332 — Revenue recognized that was included in deferred revenue at the beginning of the period ( 569,464 ) ( 486,805 ) Revenue recognized that was not included in deferred revenue at the beginning of the period ( 954,541 ) ( 855,330 ) Translation adjustments 4,535 ( 10,872 ) Ending balance $ 707,305 $ 705,307 Deferred revenue, current 603,737 569,464 Deferred revenue, non-current 103,568 135,843 Total deferred revenue $ 707,305 $ 705,307 Remaining Performance Obligations Our remaining performance obligations are comprised of licenses, subscription services, and professional services not yet delivered. As of January 31, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was $ 1,474.8 million , which consists of $ 707.3 million of billed consideration and $ 767.5 million of unbilled consideration. We expect to recognize 62 % of our remaining performance obligations as revenue over the next twelve months , and the remainder thereafter. Deferred Contract Acquisition Costs Our deferred contract acquisition costs are comprised of sales commissions that represent incremental costs to obtain customer contracts, and are determined based on sales compensation plans. The following table represents a rollforward of our deferred contract acquisition costs (in thousands): Year Ended January 31, 2026 2025 Beginning balance $ 221,802 $ 228,995 Additions to deferred contract acquisition costs 116,202 89,124 Amortization of deferred contract acquisition costs ( 109,362 ) ( 92,089 ) Translation adjustments 9,805 ( 4,228 ) Ending balance $ 238,447 $ 221,802 Deferred contract acquisition costs, current 84,739 82,461 Deferred contract acquisition costs, non-current 153,708 139,341 Total deferred contract acquisition costs $ 238,447 $ 221,802 95 UiPath, Inc. Notes to Consolidated Financial Statements 04 Marketable Securities The following is a summary of our marketable securities (in thousands): As of January 31, 2026 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Treasury bills and U.S government securities (1) $ 619,831 $ 324 $ — $ 620,155 Corporate bonds 160,872 5 — 160,877 Commercial paper 34,373 17 — 34,390 Yankee bonds 2,899 — ( 2 ) 2,897 Total marketable securities $ 817,975 $ 346 $ ( 2 ) $ 818,319 (1) Additional treasury bills with both amortized cost and estimated fair value of $ 22.0 million are included in cash and cash equivalents due to their original maturities of three months or less. As of January 31, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Treasury bills and U.S government securities $ 703,740 $ — $ ( 421 ) $ 703,319 Corporate bonds 93,989 36 — 94,025 Commercial paper 42,371 20 — 42,391 Yankee bonds 4,707 — ( 7 ) 4,700 Total marketable securities $ 844,807 $ 56 $ ( 428 ) $ 844,435 As of January 31, 2026 and 2025, $ 217.0 million and $ 94.1 million, respectively, of our marketable securities had remaining contractual maturities of one year or more. As of January 31, 2026 and 2025, $ 10.1 million and $ 2.4 million, respectively, of interest receivable was included in prepaid expenses and other current assets on the consolidated balance sheets. We did not recognize an allowance for credit losses against interest receivable as of January 31, 2026 or 2025. Unrealized losses during the periods presented are a result of changes in market conditions. We do not believe that any unrealized losses are attributable to credit-related factors based on our evaluation of available evidence. To determine whether a decline in value is related to credit loss, we evaluate, among other factors, the extent to which the fair value is less than the amortized cost basis and any adverse conditions specifically related to an issuer of a security or its industry. 96 UiPath, Inc. Notes to Consolidated Financial Statements 05 Fair Value Measurement The following tables present our financial assets and liabilities measured at fair value on a recurring basis (in thousands): As of January 31, 2026 Level 1 Level 2 Level 3 Total Financial Assets: Money market funds $ 279,658 $ — $ — $ 279,658 Treasury bills 21,982 — — 21,982 Total cash equivalents 301,640 — — 301,640 Treasury bills & U.S. government securities 620,155 — — 620,155 Corporate bonds — 160,877 — 160,877 Commercial paper — 34,390 — 34,390 Yankee bonds — 2,897 — 2,897 Total marketable securities 620,155 198,164 — 818,319 Other investments carried at fair value — — 14,202 14,202 Total $ 921,795 $ 198,164 $ 14,202 $ 1,134,161 Financial Liabilities: Contingent consideration $ — $ — $ 1,532 $ 1,532 Total $ — $ — $ 1,532 $ 1,532 As of January 31, 2025 Level 1 Level 2 Level 3 Total Financial Assets: Money market funds $ 311,942 $ — $ — $ 311,942 Total cash equivalents 311,942 — — 311,942 Treasury bills and U.S. government securities 703,319 — — 703,319 Corporate bonds — 94,025 — 94,025 Commercial paper — 42,391 — 42,391 Yankee bonds — 4,700 — 4,700 Total marketable securities 703,319 141,116 — 844,435 Other investments carried at fair value — — 11,879 11,879 Total $ 1,015,261 $ 141,116 $ 11,879 $ 1,168,256 Our money market funds and treasury bills and U.S. government securities are classified within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. We classify corporate bonds, commercial paper, and Yankee bonds as Level 2 because they are valued using inputs other than quoted prices which are directly or indirectly observable in the market, including readily-available pricing sources for the identical underlying security which may not be actively traded. Other investments carried at fair value (which consist of convertible bonds of a private company, the H Company, purchased during fiscal year 2025) and contingent consideration liability associated with business acquisition are classified as Level 3 because their valuation relies on unobservable inputs. 97 UiPath, Inc. Notes to Consolidated Financial Statements 06 Business Acquisitions Peak AI Limited On March 7, 2025, we acquired all outstanding equity of Peak, a U.K.-based software company that provides pricing and inventory intelligence technology. With this acquisition, we gained an experienced team, established customer relationships in retail and manufacturing sectors, and technology that is optimized for industry-specific use cases. The total purchase consideration for the acquisition of Peak was $ 40.1 million, consisting of initial cash consideration of $ 30.3 million and deferred and contingent consideration with an aggregate acquisition-date fair value of $ 9.8 million. The Peak acquisition was accounted for as a business combination. The following table summarizes the allocation of purchase price to the assets acquired and liabilities assumed as of the acquisition date (in thousands): Intangible assets $ 16,181 Other net liabilities ( 5,421 ) Goodwill 29,330 Total $ 40,090 The following table sets forth the identifiable intangible assets acquired and their estimated useful lives as of the acquisition date: Fair Value (in thousands) Estimated Useful Life (in years) Customer relationships $ 9,228 3.0 Developed technology 6,447 5.0 Trade names and trademarks 506 3.0 Total $ 16,181 The acquisition of Peak generated goodwill of $ 29.3 million representing expected synergies and acquired skilled workforce. None of this goodwill is deductible for tax purposes. 07 Intangible Assets and Goodwill Intangible Assets, Net Intangible assets, net consisted of the following as of January 31, 2026 (dollars in thousands): Intangible Assets, Gross Accumulated Amortization Intangible Assets, Net Weighted-Average Remaining Useful Life (Years) Developed technology $ 37,716 $ ( 28,021 ) $ 9,695 3.1 Customer relationships 20,910 ( 11,546 ) 9,364 2.3 Trade names and trademarks 826 ( 430 ) 396 2.2 Other intangibles 1,231 ( 697 ) 534 5.7 Total $ 60,683 $ ( 40,694 ) $ 19,989 98 UiPath, Inc. Notes to Consolidated Financial Statements Intangible assets, net consisted of the following as of January 31, 2025 (dollars in thousands): Intangible Assets, Gross Accumulated Amortization Intangible Assets, Net Weighted-Average Remaining Useful Life (Years) Developed technology $ 28,130 $ ( 21,416 ) $ 6,714 2.2 Customer relationships 8,183 ( 7,648 ) 535 0.5 Trade names and trademarks 271 ( 271 ) — 0.0 Other intangibles 1,231 ( 575 ) 656 6.4 Total $ 37,815 $ ( 29,910 ) $ 7,905 We record amortization expense associated with acquired developed technology in cost of licenses revenue and cost of subscription services revenue, trade names and trademarks in sales and marketing expense, customer relationships in sales and marketing expense, and other intangibles in general and administrative expense in the consolidated statements of operations. Amortization of acquired intangible assets was $ 8.2 million , $ 6.7 million, and $ 8.6 million for fiscal years 2026, 2025, and 2024, respectively. Expected future amortization expense related to intangible assets was as follows as of January 31, 2026 (in thousands): Year Ended January 31, Amount 2027 $ 8,308 2028 7,128 2029 2,668 2030 1,458 2031 271 Thereafter 156 Total $ 19,989 Goodwill Changes in the carrying amount of goodwill were as follows during the periods presented (in thousands): Carrying Amount Balance as of January 31, 2024 $ 89,026 Effect of foreign currency translation ( 1,722 ) Balance as of January 31, 2025 87,304 Acquisition of Peak 29,330 Effect of foreign currency translation 8,676 Balance as of January 31, 2026 $ 125,310 08 Operating Leases Our operating leases consist of real estate and vehicles and have remaining lease terms of one year to 12 years. For purposes of calculating operating lease liabilities, lease terms may be deemed to include options to extend the lease when it is reasonably certain that we will exercise those options. Our operating lease arrangements do not contain any material restrictive covenants or residual value guarantees. 99 UiPath, Inc. Notes to Consolidated Financial Statements Lease costs are presented below (in thousands): Year Ended January 31, 2026 2025 2024 Operating lease cost $ 16,976 $ 15,899 $ 13,047 Short-term lease cost 2,709 3,722 4,965 Variable lease cost 3,479 2,065 2,142 Sublease income (1) — — ( 1,615 ) Total lease cost $ 23,164 $ 21,686 $ 18,539 (1) Included in other income, net in the consolidated statements of operations Supplemental balance sheet information related to leases is as follows (in thousands): As of January 31, 2026 2025 Assets: Operating lease right-of-use assets $ 64,472 $ 66,500 Liabilities: Operating lease liabilities, current (included in accrued expenses and other current liabilities) $ 10,306 $ 3,587 Operating lease liabilities, non-current 70,940 74,230 Total operating lease liabilities $ 81,246 $ 77,817 Supplemental cash flow information related to operating leases is as follows for the periods presented (in thousands): Year Ended January 31, 2026 2025 2024 Cash paid for amounts included in the measurement of operating lease liabilities $ 16,745 $ 16,758 $ 12,907 Operating lease ROU assets obtained in exchange for new operating lease liabilities $ 5,712 $ 21,242 $ 12,986 The following table represents the weighted-average remaining lease term and discount rate for the periods presented: As of January 31, 2026 2025 Weighted-average remaining lease term (years) 9.1 10.1 Weighted-average discount rate 7.2 % 7.2 % Future undiscounted lease payments for our operating lease liabilities as of January 31, 2026 were as follows (in thousands): Year Ended January 31, Amount 2027 $ 15,940 2028 15,194 2029 11,372 2030 10,069 2031 9,541 Thereafter 48,280 Total operating lease payments 110,396 Less: imputed interest ( 29,150 ) Total operating lease liabilities $ 81,246 100 UiPath, Inc. Notes to Consolidated Financial Statements As of January 31, 2026, we had non-cancellable commitments in the amount of $ 12.2 million related to operating leases of real estate facilities that have not yet commenced. 09 Balance Sheet Components Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): As of January 31, 2026 2025 Prepaid expenses and service credits $ 55,332 $ 65,334 Other current assets 50,245 20,942 Prepaid expenses and other current assets $ 105,577 $ 86,276 Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): As of January 31, 2026 2025 Computers and equipment $ 25,131 $ 23,677 Leasehold improvements 52,578 31,402 Furniture and fixtures 9,266 7,124 Construction in progress 4,103 9,562 Other 823 635 Property and equipment, gross 91,901 72,400 Less: accumulated depreciation ( 45,887 ) ( 39,660 ) Property and equipment, net $ 46,014 $ 32,740 Depreciation expense was $ 5.8 million , $ 8.1 million, and $ 11.1 million for fiscal years 2026, 2025, and 2024, respectively. Other Assets, Non-Current As of January 31, 2026 and January 31, 2025, other assets, non-current included $ 27.7 million and $ 24.4 million, respectively, related to equity investments in private companies without readily determinable fair values. As a measurement alternative, these investments are reported at cost and are assessed periodically to determine whether their carrying value must be adjusted for observable changes in price or indicators of impairment. As of January 31, 2026 and January 31, 2025, other assets, non-current also included $ 14.2 million and $ 11.9 million, respectively, related to private-company convertible bonds, which are carried at fair value. Refer to Note 5, Fair Value Measurement for further information. 101 UiPath, Inc. Notes to Consolidated Financial Statements Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): As of January 31, 2026 2025 Accrued expenses $ 35,657 $ 16,005 Accrued legal, accounting, and tax (1) 6,430 3,805 Withholding tax from employee equity transactions 4,763 4,699 Employee stock purchase plan withholdings 3,214 3,335 Payroll taxes and other benefits payable 9,288 8,258 Income tax payable 14,784 1,632 Value-added taxes payable 15,113 3,640 Operating lease liabilities, current 10,306 3,587 Deferred consideration for business acquisition 8,000 — Contingent consideration for business acquisition 1,532 — Accrued partner incentives 12,345 13,314 Cloud infrastructure liabilities 13,183 6,685 Other 35,881 18,963 Accrued expenses and other current liabilities $ 170,496 $ 83,923 (1) Prior period amounts have been expanded to conform to current period presentation 10 Commitments and Contingencies Letters of Credit We had a total of $ 3.0 million and $ 2.6 million in letters of credit outstanding predominantly in favor of certain landlords for office space as of January 31, 2026 and 2025, respectively. These letters of credit renew annually and expire on various dates through fiscal year 2030. Indemnification In the ordinary course of business, we may provide indemnification of varying scope and terms to customers, vendors, directors, and officers with respect to certain matters, including, but not limited to, losses arising out of our breach of agreements, services to be provided by us, or from intellectual property infringement claims made by third parties. These indemnification provisions may survive termination of the underlying agreement and the potential amount of future payments we could be required to make under these indemnification provisions may not be subject to maximum loss clauses. The maximum potential amount of future payments we could be required to make under these indemnification provisions is indeterminable. As of January 31, 2026 and 2025, we have not accrued a liability for these indemnification arrangements because the likelihood of incurring a payment obligation, if any, in connection with these indemnification arrangements was remote. Workforce Restructurings Our board of directors approved restructuring actions to manage our operating expenses by reducing our global workforce by approximately 5 % on June 24, 2022, and approved an additional reduction of 6 % on November 102 UiPath, Inc. Notes to Consolidated Financial Statements 10, 2022. This Fiscal Year 2023 Workforce Restructuring aimed to simplify our go-to-market approach and improve sales productivity and was completed during the second quarter of fiscal year 2024. On July 8, 2024, o ur board of directors approved the Fiscal Year 2025 Workforce Restructuring to re shape the organization by streamlining our structure, particularly in operational and corporate functions, to better prioritize our go-to-market investments and focus our research and development investments on AI and driving innovation across our platform. The Fiscal Year 2025 Workforce Restructuring was completed during the second quarter of fiscal year 2026. The following table presents total restructuring charges, consisting primarily of employee termination benefits, incurred for the periods presented by financial statement line item (in thousands): Year Ended January 31, 2026 2025 2024 Cost of subscription services revenue $ 585 $ 2,745 $ 114 Cost of professional services and other revenue 18 105 — Sales and marketing 2,524 15,452 1,376 Research and development ( 52 ) 3,058 387 General and administrative 1,332 3,366 749 Total $ 4,407 $ 24,726 $ 2,626 The following table presents changes in accrued restructuring costs, which are recorded in accrued compensation and employee benefits in the consolidated balance sheets, by restructuring plan (in thousands): Fiscal Year 2025 Workforce Restructuring Fiscal Year 2023 Workforce Restructuring Accrued restructuring costs as of January 31, 2024 $ — $ 335 Restructuring costs incurred during fiscal year 2025 24,726 — Amount paid during fiscal year 2025 ( 14,948 ) ( 335 ) Accrued restructuring costs as of January 31, 2025 $ 9,778 $ — Restructuring costs incurred during fiscal year 2026 4,407 — Amount paid during fiscal year 2026 ( 14,101 ) — Accrued restructuring costs as of January 31, 2026 $ 84 $ — Defined Contribution Plans We sponsor retirement plans for qualifying employees, including a 401(k) plan in the U.S. a nd defined contribution plans in certain other countries, to which we make matching contributions. Our total matching contributions to all defined contribution plans during fiscal years 2026, 2025, and 2024 were $ 15.8 million , $ 17.1 million, and $ 16.0 million, respectively. Litigation From time to time, we may be involved in lawsuits, claims, investigations, and proceedings, consisting of intellectual property, commercial, employment, and other matters which arise in the ordinary course of business. In accordance with ASC 450, Contingencies , we make a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. UiPath and certain of its officers are currently parties to the following litigation matters: On September 6, 2023, a putative class action lawsuit was filed in the United States District Court for the Southern District of New York against UiPath, then Co-CEO Daniel Dines ("Mr. Dines"), and then CFO Ashim Gupta ("Mr. Gupta"), captioned In re UiPath, Inc. Securities Litigation (the "2023 Securities Action"). The complaint in this action was amended multiple times and the substance of the allegations is that, in 2021 and 2022, defendants made material misstatements and omissions, including regarding UiPath’s competitive position and its financial results, in violation of Section 11 and 15 of the Securities Act and Section 10(b), Rule 10b-5, and Section 20(a) of 103 UiPath, Inc. Notes to Consolidated Financial Statements the Exchange Act. The lawsuit is purportedly brought on behalf of a putative class of persons who purchased or otherwise acquired UiPath common stock between April 21, 2021 and September 27, 2022, and seeks unspecified monetary damages, costs and attorneys’ fees, and other unspecified relief as the Court deems appropriate. On April 23, 2024, the defendants moved to dismiss the 2023 Securities Action, and on November 4, 2024, the Court dismissed all claims under the Securities Act, but allowed the case to proceed with respect to two statements relating to competition that the plaintiffs allege violated the Exchange Act. On June 9, 2025, the plaintiff filed a third amended complaint to include two additional statements made by the defendants during the same 2021 and 2022 period, which plaintiff alleges were materially misleading. On June 26, 2025, the defendants moved to dismiss the third amended complaint in its entirety, and on October 2, 2025, the Court granted the defendants' motion to dismiss. On February 9, 2026, the plaintiff filed an appeal with the United States Court of Appeals for the Second Circuit with respect to the dismissal. Starting on November 30, 2023, five purported shareholder derivative lawsuits were filed in various courts against UiPath, as a nominal defendant, Mr. Dines, Mr. Gupta, and several of UiPath’s current and former directors, alleging that the individual defendants breached their fiduciary duties and committed other alleged misconduct in connection with the statements at issue in the 2023 Securities Action and by causing UiPath to repurchase shares at allegedly inflated prices. As of February 5, 2025, all of these derivative lawsuits were voluntarily dismissed without prejudice. On July 18, 2025, a new shareholder derivative lawsuit was filed in the District of Delaware against the same defendants alleging substantially similar claims. This case is captioned Rudolph v. Dines et al. ("Rudolph") . On November 19, 2025, the defendants moved to dismiss the Rudolph case in its entirety. In response, on or about January 20, 2026, plaintiff filed an amended complaint, and on February 19, 2026, defendants again moved to dismiss the amended complaint in its entirety. On June 20, 2024, a putative class action lawsuit was commenced in the United States District Court for the Southern District of New York against UiPath and select executives asserting claims under Sections 10(b) and 20(a) of the Exchange Act on behalf of a putative class of persons who purchased or acquired UiPath common stock, and purchasers of UiPath call options and sellers of put options, between December 1, 2023 and May 29, 2024 (the "2024 Securities Action"). Plaintiffs alleged that the defendants made material misstatements and omissions, including regarding UiPath's AI-powered Business Automation Platform and UiPath's strategy for, the success of, and customer demand for the platform, and sought unspecified monetary damages, costs and attorneys' fees, and other unspecified relief. On January 21, 2025, the defendants moved to dismiss the amended complaint and on July 23, 2025, the Court granted the motion and dismissed the amended complaint in its entirety. On September 12, 2025, the plaintiffs filed a second amended complaint alleging that former CEO Robert Enslin and Mr. Gupta made material misstatements and omissions during the earnings calls and in company disclosures during a class period of December 1, 2023 to May 29, 2024, in violation of Section 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder. On October 27, 2025, defendants moved to dismiss the second amended complaint in its entirety. The two purported shareholder derivative lawsuits related to the 2024 Securities Action, filed in the United States District Court for the Southern District of New York on July 8, 2024 and April 27, 2025, respectively, are stayed pending further resolution of the 2024 Securities Action. We have not recorded any accrual related to the aforementioned litigation matters as of January 31, 2026, as we believe a loss in these matters is neither probable nor estimable at this time. Warranty We warrant to customers that our platform will operate substantially in accordance with its specifications. Historically, no significant costs have been incurred related to product warranties. Based on such historical experience, the probability of incurring such costs in the future is deemed remote. As such, no accruals for product warranty costs have been made. Other Matters Our indirect tax positions are subject to audit in multiple jurisdictions globally. Notably, our Romanian subsidiary was subjected to audits by the ANAF for VAT and corporate income tax for the periods from January 2020 through January 2022 and January 2018 through January 2022, respectively, which 104 UiPath, Inc. Notes to Consolidated Financial Statements were completed during the first quarter of fiscal year 2025. With regard to the VAT audit, an assessment of $ 14.3 million has been issued. While we paid this assessment during fiscal year 2025 , we disagree with the assessment and are in the process of appealing through litigation. The amount of the payment is included in other assets, non-current on our consolidated balance sheets as of January 31, 2026, and we have not recorded any estimated liability related to this litigation as of January 31, 2026, as we believe it is not probable that a material loss has been incurred. Additionally, our Romanian subsidiary was selected for VAT audit for the period from February 2022 through April 2024. The audit for the period from March 2024 through April 2024 has been finalized with $ 0.2 million refunded to us. The audit for the period from February 2022 through February 2024 is currently suspended until the appeal of the aforementioned prior period assessment is resolved in court. While the audit is ongoing and no official assessment has been issued, we estimate a possible loss of approximately $ 13.0 million. We have not recorded any estimated liability related to this audit as of January 31, 2026, as we believe it is not probable that a material loss has been incurred. Our Indian subsidiary is currently subject to GST inspection for the period from April 2021 through March 2024. A preliminary inquiry for certain transactions with a GST amount of $ 48.7 million has been raised. We have responded to all requests from the tax authority. The inspection for the period from April 2018 through March 2021 has been dropped as the statute of limitation has lapsed. We have not recorded any estimated tax liability related to this audit as of January 31, 2026, as we believe it is not probable that a material loss has been incurred. Additionally, our Indian subsidiary has an open advance pricing agreement request with the Indian taxing authorities. Although no formal assessment has been issued as of January 31, 2026, based on several discussions with the tax authorities, we recognized a reserve during fiscal year 2026 to reflect the exposure arising from the difference between the mark-ups currently applied and those expected to be proposed by the tax authorities. The resulting tax and interest impact of $ 5.2 million is included in the computation of benefit from income taxes for the period. Further, we are currently subject to various other audits, including sales and use tax audit of our U.S. entity in New York State for the periods from March 2019 through February 2022 and December 2022 through May 2025 and VAT audits in various foreign jurisdictions. We have not recorded any estimated tax liabilities related to these audits as of January 31, 2026, as we believe it is not probable that a material loss has been incurred. For additional information regarding corporate income tax audits, refer to Note 13. Income Taxes . Non-Cancelab le Purchase Obligations In the normal course of business, we enter into non-cancelable purchase commitments with various parties, mainly for hosting services, software products and services, and purchase of credits toward products and services from strategic alliance partners. As of January 31, 2026, we had outstanding non-cancelable purchase obligations with a term of 12 months or longer as follows (in thousands): Year Ended January 31, Amount 2027 $ 163,400 2028 115,188 2029 68,270 2030 3 2031 — Thereafter — Total $ 346,861 105 UiPath, Inc. Notes to Consolidated Financial Statements 11 Stockholders' Equity Common Stock Our amended and restated certificate of incorporation authorizes a total of 2.0 billion shares of Class A common stock and 115.7 million shares of Class B common stock. Each share of Class B common stock will convert automatically into Class A common stock, on a one -to-one basis, upon certain circumstances, including: (1) the sale or transfer of such share of Class B common stock (except under certain circumstances described in the amended and restated certificate of incorporation), (2) a date fixed by the board of directors that is no less than 120 days and no more than 180 days following the date that the number of shares of Class B common stock outstanding is less than 20 % of the number of shares of Class B common stock outstanding immediately prior to the completion of the IPO , or (3) six months after the death or incapacity of Daniel Dines. Class A common stock is entitled to one vote per share and Class B common stock is entitled to thirty-five votes per share. Stock Repurchases On September 1, 2023, our board of directors authorized a stock repurchase program, which authorized the repurchase from time to time of up to $ 500.0 million of our outstanding shares of Class A common stock. This authorization was scheduled to expire on March 1, 2025. On August 30, 2024, our board of directors authorized the repurchase of an additional $ 500.0 million of our Class A common stock. The current authorization may be suspended or discontinued at any time and does not have a specified expiration date. Repurchases under the program may be effected through open market purchases, privately-negotiated transactions, or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 trading plans and under Rule 10b-18 of the Exchange Act. The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions, and alternate uses of capital. We repurchased 30.9 million shares of our Class A common stock at an average price of $ 10.92 per share during fiscal year 2026 (inclusive of brokerage commission), and 31.8 million shares of our Class A common stock at an average price of $ 12.30 per share during fiscal year 2025 (inclusive of brokerage commission) . For fiscal year 2026 and 2025 , we accrued $ 1.4 million and $ 1.4 million, respectively, of related excise tax pursuant to the Inflation Reduction Act of 2022, which is included in the cost of treasury stock on our consolidated balance sheets. Subsequent to January 31, 2026, between February 1, 2026 and February 11, 2026, we repurchased an additional 14.1 million shares of our Class A common stock at an average price of $ 12.11 per share, fulfilling the current stock repurchase authorization. In March 2026, our board of directors authorized the repurchase of an additional $ 500.0 million of our Class A common stock. Charitable Donations of Class A Common Stock We have reserved 2.8 million shares of our Class A common stock to fund our social impact and ESG initiatives. We contributed 0.3 million shares of our Class A common stock during each of fiscal years 2026, 2025, and 2024 to a donor-advised fund in connection with our Pledge 1% commitment. The aggregate fair values of the shares on the respective contribution dates of $ 4.2 million, $ 6.6 million, and $ 4.2 million were recorded within general and administrative expense in the consolidated statements of operations for fiscal years 2026, 2025, and 2024, respectively. 106 UiPath, Inc. Notes to Consolidated Financial Statements Conversion of Class B Common Stock to Class A Common Stock During fiscal year 2026, 17.8 million shares of Class B common stock beneficially owned by CEO Daniel Dines were converted into Class A common stock in connection with a previously disclosed Rule 10b5-1 trading plan. All remaining outstanding shares of Class B common stock continue to be beneficially owned by Mr. Dines. Preferred Stock Our amended and restated certificate of incorporation authorizes a total of 20.0 million shares of preferred stock. Dividends Holders of common stock are entitled to receive dividends whenever funds are legally available and when declared by the board of directors, subject to the priority rights of holders of preferred stock. No dividends have been declared by the board of directors from inception through January 31, 2026. Accumulated Other Comprehensive Income (Loss) Changes in the components of accumulated other comprehensive income (loss) were as follows during the periods presented (in thousands): Foreign Currency Translation Adjustments Unrealized Gain (Loss) on Marketable Securities Accumulated Other Comprehensive Income (Loss) Balance as of January 31, 2024 $ 8,925 $ ( 100 ) $ 8,825 Other comprehensive loss ( 14,012 ) ( 272 ) ( 14,284 ) Tax benefit 569 — 569 Balance as of January 31, 2025 $ ( 4,518 ) $ ( 372 ) $ ( 4,890 ) Other comprehensive income 41,672 717 42,389 Tax expense ( 898 ) — ( 898 ) Balance as of January 31, 2026 $ 36,256 $ 345 $ 36,601 12 Equity Plans and Stock-Based Compensation 2021 Stock Plan In April 2021, prior to and in connection with the IPO, we adopted the 2021 Plan , which provides for grants of incentive stock options, nonstatutory stock options, stock appreciation rights, RSAs, RSUs, PSUs, and other forms of awards. As of January 31, 2026, w e have reserved 229.8 million shares of our Class A common stock to be issued under the 2021 Plan. The number of shares of our Class A common stock reserved for issuance under the 2021 Plan will automatically increase on February 1 of each year for a period of ten years , which began on February 1, 2022 and continues through February 1, 2031, in an amount equal to (1) 5 % of the total number of shares of our common stock (both Class A and Class B) outstanding on the preceding January 31, or (2) a lesser number of shares determined by our board of directors no later than the February 1 increase. Although certain stock options remain outstanding under our prior stock plans, the UiPath, Inc. 2018 Stock Plan and the UiPath, Inc. 2015 Stock Plan, no shares are available for issuance of new awards under these plans. 2021 Employee Stock Purchase Plan In April 2021, prior to and in connection with the IPO, we adopted the ESPP. As of January 31, 2026, t he ESPP authorizes the issuance of 32.7 million shares of our Class A common stock under purchase rights granted to 107 UiPath, Inc. Notes to Consolidated Financial Statements our employees. The number of shares of our Class A common stock reserved for issuance will automatically increase on February 1 of each year for a period of 10 years, which began on February 1, 2022 and continues through February 1, 2031, by the lesser of (1) 1 % of the total number of shares of our common stock (both Class A and Class B) outstanding on the preceding January 31; and (2) 15.5 million shares, except that before the date of any such increase, our board of directors may determine that such increase will be less than the amount set forth by (1) and (2) above. The ESPP allows participants to purchase shares at the lesser of (a) 85 % of the fair market value our Class A common stock as of the commencement of the offering period, and (b) 85 % of the fair market value of our Class A common stock on the corresponding purchase date. Outstanding Equity Awards Stock Options Stock options granted under the 2021 Plan generally vest over three to four years and are generally forfeited in case of termination of employment or service before the satisfaction of service-based vesting conditions. Vested stock options generally expire three months after termination of employment and ten years from the date of grant. Certain stock option holders have the right to exercise unvested options, subject to a repurchase right held by us at the original exercise price in the event of voluntary or involuntary termination of employment of the option holders, until the options are fully vested. Stock option activity during fiscal year 2026 was as follows: Stock Options (in thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Life (years) Aggregate Intrinsic Value (in thousands) Balance as of January 31, 2025 7,935 $ 0.60 7.5 $ 108,138 Granted 3,004 $ 0.10 Exercised ( 3,697 ) $ 0.30 Forfeited ( 452 ) $ 0.10 Expired — $ — Balance as of January 31, 2026 6,790 $ 0.57 7.5 $ 81,589 Vested and exercisable as of January 31, 2026 2,378 $ 1.45 5.4 $ 26,488 The weighted-average grant date fair value of stock options granted during fiscal years 2026, 2025, and 2024 was $ 10.90 , $ 18.00 and $ 16.84 per share, respectively. The intrinsic value of stock options exercised during fiscal years 2026, 2025, and 2024 was $ 48.3 million, $ 58.5 million, and $ 93.2 million, respectively. As of January 31, 2026, unrecognized compensation expense associated with unvested stock options granted and outstanding was $ 49.5 million, which is expected to be recognized over a weighted-average remaining period of 2.0 years. Fair value of each stock option grant was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions: Year Ended January 31, 2026 2025 2024 Expected term (years) 5.8 5.7 5.9 Expected volatility 63.7 % 64.2 % 65.2 % Risk-free interest rate 4.0 % 4.2 % 3.6 % Expected dividend yield 0.0 % 0.0 % 0.0 % Restricted Stock Units RSUs granted under th e 2021 Plan g enerally vest over three to four years and are generally forfeited in case of termination of employment or service before the satisfaction of service-based vesting conditions. 108 UiPath, Inc. Notes to Consolidated Financial Statements RSU activity during fiscal year 2026 was as follows: RSUs (in thousands) Weighted-Average Grant Date Fair Value Per Share Unvested as of January 31, 2025 22,449 $ 17.81 Granted 16,822 $ 11.36 Vested ( 13,575 ) $ 16.96 Forfeited ( 5,798 ) $ 15.67 Unvested as of January 31, 2026 19,898 $ 13.56 The intrinsic value of RSUs released during fiscal years 2026, 2025, and 2024 was $ 178.8 million , $ 234.6 million, and $ 329.6 million, respectively. As of January 31, 2026, unrecognized compensation expense associated with unvested RSUs was approximately $ 244.6 million, which is expected to be recognized over a weighted-average remaining period of 2.1 years. Performance Stock Units During fiscal year 2026 , we granted 0.7 million PSUs at a weighted-average grant date fair value of $ 11.23 . These PSUs are subject to performance conditions related to the achievement of certain Company targets for fiscal year 2026 , with a potential payout ranging from 0 % to 150 % of the base number of PSUs awarded (with some PSUs having a maximum payout of 150 % and others having a maximum payout of 125 %). To the extent that they are earned, these PSUs will vest over three years from the grant date. No PSUs were granted during fiscal year 2025. During fiscal year 2024, we granted 0.1 million PSUs at a weighted-average grant date fair value of $ 18.08 per share. These PSUs were subject to performance conditions related to the achievement of certain individual and company targets for fiscal year 2024, which were not met. As a result, the PSUs were cancelled and no expense was recognized. As of January 31, 2026 , total unrecognized compensation expense related to unvested PSUs expected to vest was approximately $ 5.6 million, which is expected to be recognized over a weighted-average remaining period of 2.2 years. Employee Stock Purchase Plan Awards The fair value of ESPP awards was estimated using the Black-Scholes option pricing model with the following weighted-average assumptions: Year Ended January 31, 2026 2025 2024 Expected term (years) 0.5 0.5 0.5 Expected volatility 50.0 % 63.0 % 67.4 % Risk-free interest rate 4.2 % 5.2 % 5.0 % Expected dividend yield 0.0 % 0.0 % 0.0 % During fiscal year 2026, 1.4 million shares were purchased under the ESPP at a weighted average purchase pri ce of $ 11.15 pe r share. As of January 31, 2026, total unrecognized compensation expense related to the ESPP was approximately $ 2.7 million, which is expected to be recognized over a weighted-average remaining period of 0.4 years. 109 UiPath, Inc. Notes to Consolidated Financial Statements Stock-Based Compensation Expense Stock-based compensation expense is classified in the consolidated statements of operations as follows (in thousands): Year Ended January 31, 2026 2025 2024 Cost of subscription services revenue $ 13,676 $ 19,401 $ 14,750 Cost of professional services and other revenue 9,484 11,386 10,958 Sales and marketing 87,746 134,646 144,863 Research and development 132,890 132,757 117,965 General and administrative 46,880 59,961 83,419 Total $ 290,676 $ 358,151 $ 371,955 13 Income Taxes The U.S. and foreign components of income (loss) before income taxes are as follows for the periods presented (in thousands): Year Ended January 31, 2026 2025 2024 U.S. $ 129,333 $ ( 136,507 ) $ ( 168,587 ) Foreign ( 28,705 ) 58,407 92,772 Income (loss) before income taxes $ 100,628 $ ( 78,100 ) $ ( 75,815 ) The components of the provision for income taxes are as follows for the periods presented (in thousands): Year Ended January 31, 2026 2025 2024 Current expense (benefit) Federal $ 70 $ — $ ( 106 ) State 344 586 ( 166 ) Foreign 20,566 14,802 13,786 Total current expense $ 20,980 $ 15,388 $ 13,514 Deferred (benefit) expense Federal ( 181,824 ) 593 — State ( 23,534 ) — — Foreign 2,676 ( 20,387 ) 554 Total deferred (benefit) expense $ ( 202,682 ) $ ( 19,794 ) $ 554 Total (benefit from) provision for income taxes $ ( 181,702 ) $ ( 4,406 ) $ 14,068 110 UiPath, Inc. Notes to Consolidated Financial Statements The following is a reconciliation of the statutory federal income tax rate to our effective tax rate for fiscal year 2026 (dollars in thousands): Year Ended January 31, 2026 Amount Rate U.S. Federal statutory income tax rate $ 21,132 21.0 % U.S. state and local income taxes, net of federal income tax effect (1) ( 18,320 ) ( 18.2 ) % Effect of cross-border tax laws: Global intangible low-taxed income 20,106 20.0 % Subpart F income 847 0.8 % Tax credits: Federal research credit ( 1,400 ) ( 1.4 ) % Change in valuation allowance ( 248,126 ) ( 246.6 ) % Nontaxable or non-deductible items: Non-deductible executive compensation 2,658 2.6 % Stock-based compensation 11,757 11.7 % Other 768 0.8 % Other adjustments 40 — % Foreign tax effects: Romania: Statutory income tax rate differential 5,573 5.5 % Nontaxable or non-deductible items: Transfer pricing adjustment 4,671 4.6 % Other 1,262 1.3 % Excess R&D deductions ( 4,978 ) ( 4.9 ) % Change in valuation allowance 10,668 10.6 % Other adjustments 49 — % India 1,159 1.2 % Japan 753 0.7 % Netherlands 1,380 1.4 % U.K. 2,187 2.2 % Other foreign jurisdictions 776 0.8 % Changes in unrecognized tax benefits 5,336 5.3 % (Benefit from) provision for income taxes $ ( 181,702 ) ( 180.6 ) % (1) New York State and New York City taxes constitute the majority of the tax effect in this category. The following is a reconciliation of the statutory federal income tax rate to our effective tax rate for fiscal years 2025 and 2024: Year Ended January 31, 2025 2024 Federal statutory income tax rate 21.0 % 21.0 % Foreign taxes ( 11.6 ) ( 2.0 ) Non-deductible expenses ( 9.5 ) ( 17.9 ) Stock-based compensation ( 25.0 ) ( 4.6 ) Valuation allowance 62.2 ( 5.7 ) Research and development credits 14.7 18.9 Cross border tax law ( 44.6 ) ( 27.4 ) Other, net ( 1.6 ) ( 0.9 ) Effective income tax rate 5.6 % ( 18.6 ) % 111 UiPath, Inc. Notes to Consolidated Financial Statements Significant components of DTAs and DTLs are as follows as of the periods presented (in thousands): As of January 31, 2026 2025 Deferred tax assets: Net operating loss carryforwards $ 325,465 $ 317,489 Accruals and reserves 10,640 12,643 Stock-based compensation 4,945 6,512 Deferred revenue 14,452 29,376 Research and development 50,417 90,110 Depreciation and amortization — 1,459 Lease liabilities 14,586 8,255 Other 11,405 6,428 Total deferred tax assets, gross 431,910 472,272 Less: valuation allowance ( 150,535 ) ( 406,251 ) Total deferred tax assets, net of valuation allowance 281,375 66,021 Deferred tax liabilities: Intangible assets ( 4,479 ) ( 1,431 ) Right-of-use assets ( 10,886 ) ( 5,728 ) Commissions ( 34,677 ) ( 30,871 ) Depreciation and amortization ( 2,902 ) — Other (1) ( 4,729 ) ( 3,825 ) Total deferred tax liabilities ( 57,673 ) ( 41,855 ) Net deferred tax assets $ 223,702 $ 24,166 Net deferred tax assets $ 233,401 $ 27,963 Net deferred tax liabilities (included in other liabilities, non-current) ( 9,699 ) ( 3,797 ) Net deferred tax assets $ 223,702 $ 24,166 (1) Prior period amounts have been aggregated to conform to current period presentation The table below details our DTA valuation allowances and the changes therein for the periods presented (in thousands): Beginning Balance Additions During the Period Reductions During the Period Ending Balance Year ended January 31, 2026 $ 406,251 $ 7,699 $ ( 263,415 ) $ 150,535 Year ended January 31, 2025 $ 470,040 $ 17,314 $ ( 81,103 ) $ 406,251 For fiscal year 2026, we recorded a net decrease in valuation allowance of $ 255.7 million, which consists of a valuation allowance release of $ 204.9 million related to our U.S. entity based on our reassessment of the amount of the U.S. DTAs that are more likely than not to be realized, a net decrease of $ 58.5 million related to a decrease in net DTAs associated with our U.S. and India entities, and a net increase of $ 7.7 million related to an increase in the net DTAs associated with our Romania and U.K. entities. For fiscal year 2025, we recorded a net decrease in valuation allowance of $ 63.8 million, driven by the release of the U.K. DTAs. The realization of tax benefits of net DTAs is dependent upon future levels of taxable income of an appropriate character in the periods the items are expected to be deductible or taxable. As of January 31, 2026, based on the available positive and negative evidence, including the amount of taxable income in the U.S. in recent 112 UiPath, Inc. Notes to Consolidated Financial Statements years and our expectations of future profits in the U.S., we now believe it is more likely than not that part of the U.S. DTA is realizable. Therefore, during fiscal year 2026, we released the $ 204.9 million valuation allowance associated with the U.S. DTA. We continue to maintain full valuation allowances against some U.S. state and Romania DTAs as of January 31, 2026, because we believe based on our current evaluations that it is more likely than not that these DTAs will not be realized. We intend to maintain each of these full valuation allowances until sufficient positive evidence exists to support a reversal of, or decrease in, each of the respective valuation allowances. However, we may release our U.S. state or Romania valuation allowances in future periods if objective negative evidence of cumulative losses is no longer present and positive evidence, such as projection of future growth, supports the realization of such DTAs. Release of all or a portion of these valuation allowances would result in a decrease in the provision for income taxes in the period of the release. As of January 31, 2026, we had U.S. federal NOLs of $ 662.4 million available to offset future taxable income, all of which can be carried forward indefinitely. As of January 31, 2025 we had U.S. federal NOLs of $ 645.8 million, all of which could be carried forward indefinitely. As of January 31, 2026 and 2025, we had state NOLs of $ 941.2 million and $ 834.6 million, respectively, which begin expiring in 2027. As of January 31, 2026 and 2025, we had Romania NOLs of $ 697.3 million and $ 658.2 million, respectively, which begin expiring in 2027. As of January 31, 2026 and 2025, we had Japan NOLs of none and $ 1.8 million, respectively, as all of the available NOLs have been used as of January 31, 2026. Additionally, as of January 31, 2026 and 2025, we had U.K. NOLs of $ 95.2 million and $ 101.7 million, respectively, which may be carried forward indefinitely. Pursuant to Section 382 of the IRC, annual use of our U.S. NOLs may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period. We determined that two such ownership changes have occurred. The first resulted in an annual limitation, independent of net unrealized built-in gains, of $ 0.1 million for our NOLs as of April 24, 2017 but did not result in permanent disallowance of any NOLs. The second resulted in an annual limitation, independent of net unrealized built-in gains, of $ 29.0 million for our NOLs as of July 9, 2020 but did not result in permanent disallowance of any NOLs. As of January 31, 2026, we have recorded a deferred tax liability of $ 4.7 million associated with the undistributed earnings of our foreign subsidiaries that we no longer intend to indefinitely reinvest. The table below details our cash paid for income taxes, net of refunds received, by jurisdiction for fiscal year 2026 (in thousands): Year Ended January 31, 2026 U.S. federal $ — U.S. state and local 120 Foreign: France 786 India 762 Japan 1,975 Netherlands ( 755 ) Singapore 1,511 U.K. 2,723 Other 2,690 Total foreign 9,692 Total cash paid for income taxes, net of refunds $ 9,812 113 UiPath, Inc. Notes to Consolidated Financial Statements The table below details our gross unrecognized tax benefits (excluding penalties and interest) and the changes therein for the periods presented (in thousands): Year Ended January 31, 2026 2025 Beginning unrecognized tax benefits $ 60,175 $ 504 Additions based on current year tax positions 3,335 — (Reductions) additions for tax positions related to prior years ( 34,289 ) 59,671 Ending unrecognized tax benefits $ 29,221 $ 60,175 As of January 31, 2026, we had a reserve for gross unrecognized tax benefits totaling $ 32.0 million (inclusive of penalties and interest) related to income taxes, of which $ 6.9 million would impact the effective tax rate if recognized. Of this amount, $ 4.2 million pertains to uncertain tax positions, and the remainder relates to interest and penalties, which are accounted for as a component of our income tax provision. The remainder of the unrecognized tax benefits, which primarily relate to the Romanian corporate income tax audit by ANAF and bilateral transfer pricing negotiations between the U.S. and Romania (described in further detail below), would not affect the effective tax rate because the unrecognized tax benefit is recorded as a reduction in our gross deferred assets, offset by a corresponding reduction in our valuation allowance. As of January 31, 2025, we had gross unrecognized tax benefits of $ 60.9 million (inclusive of penalties and interest) related to income taxes, of which $ 1.6 million would impact the effective tax rate if recognized. Of this amount, the total liability pertaining to uncertain tax positions was $ 0.9 million, excluding interest and penalties. Our policy is to recognize interest and penalties associated with tax matters as part of the income tax provision. During fiscal year 2026, the penalties and interest recorded related to uncertain tax positions was not material. Our tax positions are subject to income tax audits in multiple tax jurisdictions globally. Our estimate of the potential outcome of any uncertain tax position is subject to management's assessment of the relevant risks, facts, and circumstances existing at that time. We believe that we have provided adequate reserves for our income tax uncertainties in all open tax years. However, our future results may include adjustments to estimates in the period the audits are settled, which may impact our effective tax rate. Currently, our India subsidiary is appealing the corporate income tax assessment of $ 1.9 million for the audit period of April 2019 through March 2021. It also has an open corporate income tax audit for the period from January 2018 through March 2024. We expect that the advance pricing agreement with the Indian tax authorities will be finalized during fiscal year 2027 and as a result, all past tax disputes and litigation for the transfer pricing matters will be closed. During fiscal year 2025, the Romanian ANAF completed a corporate income tax audit for the period from January 2018 through January 2022. Certain deductions have been disallowed, resulting in a proposed reduction of NOLs of approximately $ 66.7 million. We are appealing $ 64.3 million of the disallowance through litigation, $ 25.4 million of which we believe more likely than not will not be sustained. In addition, during fiscal year 2026, the bilateral transfer pricing agreement between the U.S. and Romania has been finalized and signed, as the U.S. and Romania tax authorities have reached a mutual agreement on the transfer pricing methodology for the Cost Contribution Agreement between our U.S entity and our Romania entity for taxable years ending January 31, 2023 through January 31, 2028. The bilateral transfer pricing negotiations for our transfer pricing model between Japan and Romania are still underway, with the expectation of being finalized during the first half of fiscal year 2027, in line with the tax position we have adopted. We file income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions, and various international jurisdictions. Tax years 2022 and forward generally remain open for examination for federal and state tax purposes. Tax years 2019 and forward generally remain open for examination for foreign tax purposes. To the extent utilized in future years’ tax returns, NOLs at January 31, 2026 and 2025 will remain subject to examination until the respective tax year is closed. On December 20, 2021, the OECD published the Pillar Two Model Rules defining the global minimum tax, which calls for 15% global minimum tax for multinational enterprises with an annual revenue above €750.0 million. The OECD has since issued administrative guidance providing transition and safe harbor rules around the implementation of the Pillar Two global minimum tax. Various countries, including EU countries, U.K., Japan, and Australia, have implemented the Pillar Two rules to varying degrees. We assessed and concluded that the Pillar 114 UiPath, Inc. Notes to Consolidated Financial Statements Two Model Rules do not have a significant impact on our consolidated financial statements for fiscal year 2026. We will continue to monitor developments and evaluate potential impact on future periods. 14 Net Income (Loss) Per Share The following table sets forth the computation of basic and diluted net income (loss) per share for the periods presented (in thousands except per share amounts): Year Ended January 31, 2026 2025 2024 Numerator: (1) Net income (loss) $ 282,330 $ ( 73,694 ) $ ( 89,883 ) Denominator: (1) Weighted-average shares used in computing net income (loss) per share, basic 538,125 559,933 563,855 Dilutive potential common shares from outstanding equity awards 6,735 — — Weighted-average shares used in computing net income (loss) per share, diluted 544,860 559,933 563,855 Net income (loss) per share, basic $ 0.52 $ ( 0.13 ) $ ( 0.16 ) Net income (loss) per share, diluted $ 0.52 $ ( 0.13 ) $ ( 0.16 ) (1) Amounts presented under Class A and Class B columns in prior periods have been combined to conform with current year presentation. Anti-dilutive common stock equivalents excluded from the computation of diluted net income (loss) per share were as follows (in thousands): Year Ended January 31, 2026 2025 2024 Unvested RSUs 9,545 30,239 36,878 Outstanding stock options 1,918 10,171 13,247 Shares subject to repurchase from RSAs and early exercised stock options — 12 52 Shares issuable under ESPP 105 783 705 Returnable shares issued in connection with business acquisition — 204 349 Total 11,568 41,409 51,231 15 Related Party Transactions We have at times made use of an aircraft which is owned by Daniel Dines, our CEO, through a special purpose limited liability company and which is operated by a third-party aircraft management company. Mr. Dines, through this special purpose limited liability company, bears all associated operating, personnel, and maintenance costs. During fiscal year 2026, we incurred expenses of $ 2.6 million in connection with our business use of the aircraft. We did not incur any expenses related to the use of the aircraft in fiscal year 2025 or 2024. 115 UiPath, Inc. Notes to Consolidated Financial Statements 16 Subsequent Events On February 5, 2026, we acquired WorkFusion, Inc., a U.S.-based software company specializing in AI agents for financial crimes compliance. Consideration consists of initial cash payments totaling approximately $ 149 million, reduced for certain closing adjustments, plus additional cash payments contingent on future performance. This acquisition expands our portfolio of agentic AI-powered solutions for the financial services and banking industries. 116 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.