Revenue Performance - Total revenue for the three months ended April 30, 2025, was $763.654 million, a 7.6% increase from $709.640 million in the same period of 2024[92] - Total revenue for the three months ended April 30, 2025, was $763.7 million, an increase of 8% compared to $709.6 million in the same period of 2024[116] - Subscription revenue accounted for 98% of total revenue in Q1 2025, compared to 97% in Q1 2024[87] - Subscription revenue increased by $54.7 million, or 8%, driven by expansion in commercial and enterprise accounts as well as the digital channel[116] - Non-GAAP billings for the same period were $739,612,000, compared to $709,538,000 in 2024, reflecting an increase in customer sales and renewals[156] Customer Growth - The number of customers with annualized contract values over $300,000 increased to 1,123 as of April 30, 2025, up from 1,059 a year earlier[91] - The number of total customers reached over 1.7 million as of April 30, 2025, an increase from over 1.5 million in the previous year[97] Profitability - Net income for the three months ended April 30, 2025, was $72.087 million, compared to $33.760 million in the same period of 2024[92] - For the three months ended April 30, 2025, Docusign reported a GAAP gross profit of $606,385,000, up from $560,194,000 in the same period of 2024, resulting in a GAAP gross margin of 79.4%[152] - Non-GAAP gross profit for the same period was $628,727,000, compared to $582,170,000 in 2024, with a non-GAAP gross margin of 82.3%[152] - GAAP net income for the three months ended April 30, 2025, was $72,087,000, an increase from $33,760,000 in 2024, while non-GAAP net income was $190,851,000, up from $172,843,000[154] - Free cash flow for the three months ended April 30, 2025, was $227,815,000, slightly down from $232,073,000 in 2024[155] Expenses and Investments - Operating expenses increased to $546.1 million, representing 71% of total revenue, compared to 76% in the same period of 2024[118] - Research and development expenses rose by $25.1 million, or 19%, primarily due to workforce investments to support product innovation[120] - The total stock-based compensation expense for Q1 2025 was $145.596 million, slightly up from $142.504 million in Q1 2024[92] Cash and Financing - Cash, cash equivalents, restricted cash, and investments totaled $1.1 billion as of April 30, 2025[92] - The company had $948.7 million in cash and cash equivalents as of April 30, 2025, along with $160.1 million in long-term investments[124] - Cash provided by operating activities was $251.4 million for the three months ended April 30, 2025, slightly down from $254.8 million in 2024[134] - Net cash used in financing activities was $223.5 million, primarily due to stock repurchases and tax withholding payments[138] - The stock repurchase program resulted in the repurchase of 2.3 million shares for $183.4 million during the three months ended April 30, 2025[131] - The company may seek additional equity or debt financing in the future to support growth and operational needs[128] Strategic Initiatives - The company plans to invest in product innovation and enhance its go-to-market strategies to support long-term growth[93][94] - The company aims to strengthen its omnichannel go-to-market approach by optimizing direct sales, partner-assisted sales, and digital self-service channels[94] International Revenue - International revenue grew by 10% year-over-year, representing 28% of total revenue for both Q1 2025 and Q1 2024[100] Tax and Financial Projections - The projected non-GAAP tax rate for fiscal 2025 and 2026 is set at 20%[148] - The company entered into a new secured revolving credit facility of $750 million in May 2025, which may be increased by an additional $250 million[159] - Docusign has not engaged in hedging foreign currency transactions to date, but may consider it in the future, with no material effect expected from a 10% change in the U.S. dollar's value against other currencies[160]

DocuSign (DOCU -18.76%) reported Q1 FY2026 results on June 5, with revenue totaling $764 million, up 8% year-over-year, and non-GAAP operating margin climbing to 29.5%. The quarter was defined by rapid adoption of its Intelligent Agreement Management (IAM) software, a shift in sales incentives leading to lower early renewals and billings timing, and the announcement of an additional $1 billion in share repurchase authorization. The following insights illustrate substantial progress on product innovation, go ...

Here's our initial take on DocuSign's (DOCU -18.78%) financial report.Key MetricsMetricQ1 FY25Q1 FY26Changevs. ExpectationsRevenue$709.6 million$763.7 million8%BeatEarnings per share (adjusted)$0.82$0.9010%BeatNon-GAAP billings$709.5 million$739.6 million4%n/aFree cash flow$232.1 million$227.8 million-2%n/aDocuSign Beats Estimates, but Leaves Investors Wanting MoreThere was a lot to like about DocuSign's latest quarter. Revenue and adjusted earnings per share were up 8% and 10%, respectively, topping Wall S ...

The Docusign Inc. application for download in the Apple App Store on a smartphone arranged in Dobbs Ferry, New York, U.S., on Thursday, April 1, 2021.Shares of DocuSign tanked 18% in trading on Friday, a day after the e-signature provider reported stronger-than-expected earnings but slashed its full-year billings outlook.Here's how the company performed in the fiscal first quarter, compared with estimates from analysts polled by LSEG:Earnings per share: 90 cents, adjusted, vs. 81 cents expectedRevenue: $764 ...

Core Insights - DocuSign Inc (NASDAQ:DOCU) stock has dropped 17.1% to $76.99 despite reporting fiscal first-quarter earnings of $0.90 per share and revenue of $763.7 million, surpassing estimates of $0.81 and $747 million respectively [1] - Billings of $739.6 million fell short of the consensus estimate of $746.2 million, raising concerns about slowing demand [1] - The company's 2026 billing guidance was disappointing, contributing to the stock's decline, which has erased its year-to-date gains, now down 13.8% in 2025 [1] Market Reaction - Bearish sentiment is increasing, with at least five analysts reducing their price targets, including UBS, which lowered its target from $85 to $80 [2] - Options trading volume is significantly high, with over 21,000 contracts exchanged, which is 30 times the average for the day, indicating strong interest in the weekly 6/6 80-strike put options expiring today [2]

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...

DocuSign (NASDAQ: DOCU ) managed to beat top and bottom-line estimates for its first fiscal quarter on Thursday, but nonetheless, shares of the e-Signature leader dropped 17% in after-hours trading, mainly because of lower billings. I believe the market is massively overreacting to DocuSign’s earnings reportAnalyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purch ...

Core Viewpoint - DocuSign reported strong fiscal Q1 results, exceeding Wall Street expectations, but faced a significant stock price decline due to concerns over slowing growth and high valuation multiples [2][3][4]. Financial Performance - For the fiscal first quarter ending April 2025, DocuSign reported earnings of $0.90 per share and revenues of $763.7 million, marking a 9.8% year-over-year increase in earnings and a 7.6% rise in sales, both surpassing expectations of $0.81 per share and $748.1 million [2]. - The company's Q2 sales outlook of $779 million also slightly exceeded street estimates [2]. Stock Performance and Valuation - Following the earnings announcement, DOCU stock experienced a 17% drop in after-hours trading, attributed to investor concerns about slowing growth [3]. - As of the last close at $93, DOCU was trading at 6.6 times trailing revenues and 26 times trailing adjusted earnings, significantly higher than the S&P 500's 3 times trailing revenues [4]. - DocuSign's operating margin stands at 8%, lower than the S&P 500's average of 13%, raising questions about the justification for its premium valuation [5]. Growth Prospects - Despite a historical average revenue growth rate of 12.3% over the past three years, current estimates suggest mid-single-digit sales growth for the next few years [3]. - The company is pursuing AI-driven innovations, including the integration of its DocuSign IAM platform into Salesforce, which may support future growth [3][7]. - DocuSign is expanding into broader agreement management, which could enhance its growth potential beyond just capturing signatures [7]. Market Challenges - The company faces increased competition, particularly from Adobe, and market maturation following rapid growth during the pandemic [7]. - Investors should consider the potential for mid to high single-digit sales growth, with a valuation of 4 times trailing revenues suggesting a potential decline in stock value to under $60, representing a more than 35% drop from its recent close [8].

Financial Data and Key Metrics Changes - Revenue for Q1 fiscal 2026 was $764 million, representing an 8% year-over-year growth, driven by increased IAM customers and self-serve digital revenue contributions [9][26] - Operating margins improved by 1% year-over-year to 29.5%, while free cash flow margin was strong at 30% [9][36] - Billings grew 4% year-over-year to $740 million, slightly below guidance due to lower early renewals [10][26] Business Line Data and Key Metrics Changes - Over 10,000 customers have purchased the DocuSign IAM platform, with significant engagement and usage growth, particularly in small and mid-market segments [11][30] - IAM sales exceeded expectations, with direct customer IAM deal volume increasing compared to Q4 [17][29] - Digital revenue continued to grow at more than double the rate of overall revenue, indicating strong performance in self-serve channels [19][32] Market Data and Key Metrics Changes - International revenue represented 28% of total revenue, growing 10% year-over-year, with IAM deal volume in international markets increasing over 50% from the previous quarter [33][34] - Customer growth was robust, with total customers increasing by 10% year-over-year, surpassing 1.7 million [30][31] Company Strategy and Development Direction - The company is focused on long-term transformation through the IAM platform, aiming for accelerated growth and innovation [8][24] - Strategic changes in the go-to-market approach were implemented to enhance sales efficiency and drive IAM adoption [20][72] - The company is committed to maintaining a strong balance sheet while returning capital to shareholders through share buybacks [36][37] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth trajectory despite short-term challenges related to early renewals [21][56] - The fundamentals of the core business are improving, with gross retention and dollar net retention rates showing positive trends [22][29] - The company is taking a cautious approach to forecasting due to the uncertain economic environment, but remains optimistic about future growth [40][62] Other Important Information - The company has authorized an additional $1 billion in share buybacks, bringing total repurchase authorization to $1.4 billion [37] - Non-GAAP diluted EPS for Q1 was $0.90, an improvement from $0.82 in the previous year [38] Q&A Session Summary Question: Can you elaborate on the go-to-market transition and the reasons for lower early renewals? - Management indicated that changes in compensation structures encouraged sales reps to close deals earlier, impacting early renewals [46][48] Question: How does the broader health of the business look, particularly regarding IAM upsell opportunities? - Management expressed confidence in the IAM upsell potential and noted improvements in retention and expansion metrics [53][56] Question: What are the assumptions for billings growth in the second half of the year? - Management expects a ramp in billings growth, driven by the scaling of the commercial business globally [60][61] Question: Are there any changes in customer behavior regarding contract envelopes due to the macro environment? - Management has not observed significant changes in customer behavior regarding contract envelopes, indicating stability in Q1 [64][66] Question: Can you discuss the role of GSI partners in driving new pipeline and enterprise growth? - Management acknowledged the growing interest from SIs and the potential for these partnerships to enhance enterprise engagement [91][94]

DocuSign (DOCU) Q1 2026 Earnings Call June 05, 2025 05:00 PM ET Speaker0 Good afternoon, ladies and gentlemen. Thank you for joining DocuSign's First Quarter Fiscal Year twenty six Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. As a reminder, this conference is being recorded and will be available for replay from the Investor Relations section of the website following the call. I'll now pass t ...