DocuSign posted better-than-expected financial results for its fiscal fourth quarter ended in January, while the company gets ready to launch a revamped AI-driven approach to managing corporate agreements.
In late trading, DocuSign shares are 9% higher, at $58.04.
The electronic signature and document management company posted revenue for the quarter of $712.4 million, up 8% from a year ago. That is ahead of both the company’s guidance range of $696 million to $700 million, and Street consensus as tracked by FactSet of $698 million. Profits on an adjusted basis were 76 cents a share, ahead of the Street consensus at 64 cents.
Billings were $833.1 million, up 13%, and well above the company’s forecast range of $756 million to $768 million. On an adjusted basis, gross margin was 82%, at the high of the company’s forecast range of 81% to 82%.
CEO Allan Thygesen said in an interview with Barron’s that DocuSign had “an excellent quarter, beating on every metric,” driven by strength in both enterprise and small business customers. He said the strong billings total in the quarter reflected the company pulling in some deals faster than expected.
Thygessen said he is seeing a “slightly better” IT spending environment than in recent quarters, with “very high close rates on larger deals.”
He also said DocuSign is getting a boost from its recent addition to the Microsoft Azure marketplace, giving the company a new avenue to reach enterprise customers. Thygessen noted that DocuSign closed one $1 million deal through the Azure marketplace toward the end of the quarter that it wouldn’t have had otherwise.
For the April quarter, DocuSign sees revenue of between $704 million and $708 million, with billings of between $685 million and $695 million. Street consensus estimates had called for revenue of $701 million and billings of $683 million.
For the January 2025 fiscal year, DocuSign is projecting revenue of between $2.915 billion and $2.927 billion, above the Street consensus forecast of $2.91 billion. Free cash flow was $248.6 million, up from $113 million in the same period a year earlier.
Thygessen also noted that the company will be making significant announcements at its user conference in April that will include considerable changes to its platform.
“We’ve long believed that there is an opportunity to reinvent the entire agreement journey,” he said, while adding that “there is some AI pixie dust involved.” Artificial intelligence, he added, offers “a significant unlock” for managing corporate agreements.
