DocuSign Inc (Nasdaq: ) just came in ahead of Street estimates for its first financial quarter. Shares of the software company are still slipping in extended hours.
DocuSign stock sinks on downbeat guidance
The stock is being hit primarily because the guidance did not particularly impress. DOCU now forecasts revenue to fall between $2.92 billion and $2.93 billion in fiscal 2025.Analysts, in comparison, were at $2.93 billion. Allan C. Thygesen – the chief executive of DocuSign said in a today:
Docusign is off to a strong start in fiscal 2025. We launched a significant expansion to our company strategy with our announcement of the Docusign Intelligent Agreement Management platform.
The Nasdaq listed firm improved its free cash flow by 8.0% to $232.1 million in Q1. is now down close to 20% versus its year-to-date high in January.
DocuSign Q1 earnings snapshot
DocuSign Inc. took a 50 basis points hit to its gross margin that came in at 78.9% in Q1. CEO Thygesen also said on Thursday:
In Q1, we continued to stabilize the business and improve profitability, allowing Docusign to continue investing for long term growth.
What else was noteworthy in DOCU’s Q1 report
DocuSign saw its subscription revenue pop 8.0% on a year-over-year basis in its first financial quarter that helped offset an 18% hit to professional services and other revenue.The eSignature company ended the quarter with $1.2 billion in cash including cash equivalents, restricted cash, and investments. It also announced a $1.0 billion increase to share buyback authorisation on Thursday.In May, DOCU spent $165 million on buying – a provider of AI-enabled agreement management software. At the time, its CEO Allan Thygesen said:
This acquisition underscores our commitment to providing our customers with Intelligent Agreement Management solutions that will transform agreement data into insights, accelerate contract reviews, and boost productivity to ultimately grow revenue faster.
Wall Street currently has a consensus “hold” rating on DocuSign stock.More By This Author:Canopy Growth Just Proposed Stock SaleIntel Announces New AI Chips To Rival Nvidia Bath & Body Works Q1 Earnings: Revenue Slides 0.9%
