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Shares of the business automation software firm UiPath Inc. traded sharply higher today after it reported third-quarter earnings and revenue that topped Wall Street’s expectations.

The company reported earnings before certain costs such as stock compensation of 12 cents per share, beating Wall Street’s target of just seven cents per share. Revenue rose 24% from a year ago, to $326 million, above both the company’s own guidance range of $313 million to $318 million, and ahead of analysts’ consensus estimate of $316 million.

All told, UiPath delivered a net loss of $31.5 million, rising from a much wider loss of $57.7 million a year earlier. The company’s stock was up more than 12% in the extended trading session, having stayed flat earlier in the day. Update: Shares rose almost 27% in Friday’s trading.

UiPath co-Chief Executive Rob Enslin hailed the company’s “strong third quarter results” and highlighted its annual recurring revenue growth of 24% from a year earlier to $1387 billion.

The company is considered to be a leader in the robotic process automation market. Its software helps companies reduce costs and operational errors by automating many repetitive work-related tasks, such as data entry. The platform is powered by artificial intelligence models that learn how employees perform common tasks in their business applications. Those models then build software “robots” that can replicate those workflows, meaning they no longer need to be done manually.

For the final period of the fiscal 2023 year, UiPath is feeling optimistic about its prospects. The company is calling for sales of between $381 million and $386 million, the midpoint of that range coming in just ahead of Wall Street’s consensus estimate of $383 million. UiPath also sees ARR reaching between $1.45 billion and $1.455 billion, also just ahead of the Street’s forecast of $1.43 billion.

In a conference call with analysts, UiPath’s finance chief Ashim Gupta noted that the company leverages existing large language models within its Autopilot AI companion, as well as its own, internally developed models that are more targeted. The company has shown particular strength in the healthcare and financial services industries, he added.

Gupta was asked about the impact of macroeconomic issues on the company’s business and responded that “customers are still investing” where they see a return on their investments. “Ours is really tangible and quantifiable,” he said.

UiPath co-founder Daniel Dines (pictured), who serves as the company’s other co-CEO, revealed in July that he intends to step down from that role by early next year. He’ll instead take up a position as the company’s new chief innovation officer, where he will lead the company’s artificial intelligence initiatives and other research projects. With the move, he’s really taking on a more hands-on role at the company while leaving Enslin as the sole CEO.

Dines said in a statement that UiPath’s ongoing success is its unwavering commitment to understanding the needs of its customers. “In our most recent platform release, 2023.10, we delivered scores of new capabilities that seamlessly translate the potential of AI into tangible action, accelerate productivity, spark innovation and drive business outcomes for our customers,” he said.

Holger Mueller of Constellation Research Inc. said UiPath was already on a strong growth trajectory even prior to the buzz around AI that entered the limelight this year, saying it caters to the needs of enterprises that are seeking ways to streamline business processes. “The current AI hype has helped to accelerate UiPath further along that road and it is steadily growing its way towards profitability,” the analyst said. “Its revenue is growing faster than its cost base and if the management can keep doing that it could become profitable by the second quarter of the next fiscal year.”

During the quarter, UiPath hosted its annual user conference FORWARD VI, where it announced new generative AI capabilities in the shape of a new copilot tool, called Autopilot. The new bot is said to be so powerful that it will transform paper documents into business applications with a single click, while enabling users to build more efficient business automations using natural language commands.

Dines dropped by theCUBE, SiliconANGLE Media’s mobile livestreaming studio, during the FORWARD VI event in October to discuss the evolution of UiPath’s approach to integrated automation, and what the company’s thoughts are on what the next decade of AI systems and solutions will bring:

Photo: SiliconANGLE