UiPath Inc. (PATH) shares plummeted 5.49% in pre-market trading Thursday, extending losses from the previous session. The automation software company's stock is under pressure following the release of its quarterly financial results and forward-looking guidance.

While UiPath reported better-than-expected fourth-quarter revenue and earnings, investor sentiment turned negative due to the company's outlook. For the upcoming fiscal year 2027, UiPath projected revenue growth of approximately 9%, representing a slowdown from the 13% growth achieved in the previous full year. Furthermore, the company forecast a significant sequential decline in non-GAAP operating income for the first quarter.

The guidance has raised concerns among investors about a potential deceleration in growth amid a challenging environment for software stocks, with broader industry worries about the disruptive impact of artificial intelligence on traditional business models. Analyst firm TD Cowen also cut its price target on UiPath shares following the report.