According to UiPath’s regulatory filing, ‘This workforce reduction is aimed at further enhancing operational efficiency and customer centricity.’
About a month after changing CEOs, business automation platform provider UiPath revealed plans to cut 10 percent of its employee base â thatâs about 4,200 employees. The New York-based vendor said in a regulatory filing that most of the reductions should happen by the end of the first quarter of fiscal 2026 â in April 2025. UiPath is currently in the second quarter of its 2025 fiscal year.
According to a filing with the US Securities and Exchange Commission (SEC), “These workforce reductions are intended to further enhance operational efficiency and customer centricity.” “These changes reflect efforts to reshape the organization by streamlining the company’s structure, particularly in operational and corporate functions, better prioritizing our market investments and focusing our research and development investments on artificial intelligence and driving innovation across our platforms.”
[RELATED: UiPath CEO Resigns; Company Names Former CEO, Chief Innovation Officer To Top Spot]
UiPath Truncation
CRN has contacted UiPath for comment. UiPath makes an offer Partner Program For consultants, system integrators and other partner business models.
UiPath plans to spend $15 million to $20 million on employee termination benefits and $2 million to $5 million on lease termination and other contractual costs, according to the vendor.
The company expects to spend a total of between $17 million and $25 million by the first quarter of fiscal 2026, primarily in cash.
In a report published Tuesday, investment firm William Blair said the layoffs, “while unfortunate, may help reshape the organization and keep pace with the market,” after the company significantly lowered its growth forecast last quarter.
“We believe this announcement reflects UiPath’s objective to drive greater operational efficiency (removing some unnecessary operational layers from the organization) while maintaining top-line growth,” the report states. “Overall, we believe management’s commitment to focusing on profitability is a step in the right direction as the company adjusts to a more challenging environment.”
The firm maintained its “market perform” rating for the vendor, saying UiPath “requires greater visibility into large renewals and sales execution consistency” despite its “leadership position in the market for automation technology (which) will help the company deliver sustainable growth and expand margins over time.”
The layoffs come after UiPath co-founder and chief innovation officer Daniel Dines returned to the CEO position on June 1, replacing former CEO Rob Ensslin.
In UiPath’s most recent quarterly earnings call in May, Dines highlighted UiPath’s work with partners, particularly global systems integrators, according to the transcript.
Dines said, “Partners remain a key pillar of our go-to-market strategy, and GSI is building a long-term differentiated business with us.” He highlighted the company’s work with Accenture, No. 1 CRNâs 2024 Solution Provider 500 includes the expansion of UiPathâs role with an energy company and EYâs work on a digital transformation plan with an Ireland-based private health insurer.
“We have a lot to do on the partnership side of the business,” Dines said during the call, according to the transcript.
The UiPath opportunity in AI
A June report from William Blair, based on conversations with UiPath Chief Financial Officer Ashim Gupta, said the vendor had changed âsales rep compensation structuresâ and was removing unnecessary layers from its go-to-market pipeline to make the organization more agileâ due to ârecent execution issuesâ and âdeal misses and pressure on large deals during the first quarter.â
According to the report, “UiPath believes these changes can be implemented over the next several quarters (not years) and noted that the reduction in the number of sales representatives remains in line with historical trends.”
In the race for generative artificial intelligence (GenAI), UiPath has âseen an adoption rate of over 70 percent for autopilot expressions within its pilot groupâ and âbelieves that gen AI will have additional long-term benefits as business users will be able to create more complex automation and achieve higher ROI for the platform.â
Its intelligent document processing and test suite tools have made “solid progress,” according to the report.
UiPath competes with ServiceNow in about 1 percent of deals, and with Microsoft’s Power Automate offering in lower-complexity robotic process automation (RPA) use cases, William Blair reports, but “it does not believe the competitive environment is causing weakness in larger deals, as its win rate remains consistent with historical levels.”
According to the report, the economy has “impacted larger multi-year deals, as sales cycles have lengthened and clients are placing greater scrutiny on deals.”
Customers spending more than $100,000 on the platform âare using at least one solution outside of RPA,â and IDPs âare starting to bring larger deals to the platform.â
Still, according to the report, “UiPath highlighted that it is still primarily replacing point solution RPA solutions or converting greenfield opportunities while bringing new customers to the platform.”
UiPath is not alone in being one of the tech vendors reducing headcount in the middle of the calendar year. Layoff plans have also been reported Microsoft And OpenText,