TLDR
- DocuSign reported Q4 earnings of $0.86 per share, beating estimates of $0.84
- Revenue reached $776.25 million, surpassing expectations by 2.14%
- Stock jumped 10% in after-hours trading despite below-consensus forward guidance
- Billings increased 10% year-over-year to $923.2 million
- Company significantly increased stock buybacks to $683.5 million in 2024
DocuSign, the electronic signature technology provider, reported strong fourth-quarter results for fiscal year 2025, exceeding Wall Street expectations and sending its shares up 10% in after-hours trading despite providing guidance that fell short of analyst forecasts.
The San Francisco-based company posted earnings of $0.86 per share for the quarter ended January 2025, beating the Zacks Consensus Estimate of $0.84 per share. This represents a 2.38% earnings surprise.
This performance continues DocuSign’s trend of exceeding expectations. The company has now surpassed consensus EPS estimates in all four quarters of the fiscal year.
Revenue for the quarter reached $776.25 million, surpassing analysts’ expectations of $760.99 million. This marks a 2.14% revenue surprise and a solid increase from $712.39 million in the same quarter a year ago.
Subscription revenue, which makes up the bulk of DocuSign’s business, grew to $757.8 million. This represents a 9% increase from $695.7 million in the year-ago period.
The company reported billings of $923.2 million for the quarter. This exceeded management’s own forecast and represented a year-over-year growth of 10%.
DocuSign attributed this billing growth to successful international expansion and product diversification efforts. These initiatives appear to be paying off as the company works to broaden its market reach.
Despite the overall positive results, DocuSign’s professional services unit experienced a slight negative margin impact. This suggests the company still faces some challenges in certain segments of its business.
DocuSign ramped up its repurchase program
In a major capital allocation move, DocuSign significantly ramped up its stock repurchase program. The company bought back $683.5 million of its own stock during 2024, a substantial increase from the $145.5 million in repurchases made in 2023.
Looking ahead, DocuSign provided guidance that fell slightly below Wall Street expectations. For the current quarter, the company expects revenue between $745 million and $749 million, below the consensus forecast of $755.70 million.
For the full fiscal year, DocuSign anticipates revenue of $3.13 billion to $3.14 billion. This projection also falls short of analysts’ consensus target of $3.15 billion.
Despite this conservative outlook, investors appeared to focus more on the strong quarterly results. The 10% after-hours jump in share price indicates confidence in the company’s current performance.
DocuSign’s year-to-date stock performance has been challenging. Prior to this earnings release, shares had declined approximately 17% since the beginning of 2025, underperforming compared to the S&P 500’s decline of 4.8%.
The company is working to revitalize growth following a post-pandemic slowdown. After seeing surging demand during COVID-19 when remote work drove adoption of electronic signature solutions, DocuSign has faced the challenge of maintaining momentum.
Management has emphasized their focus on expanding the company’s product portfolio beyond its core electronic signature offerings. They aim to leverage innovation to drive both current and future growth.
Wall Street remains divided on the stock
Wall Street analysts remain divided on DocuSign’s prospects. The stock currently has a consensus “Moderate Buy” rating based on evaluations from six analysts, split evenly between three “Buy” and three “Hold” recommendations.
The average price target for DocuSign stock stands at $103.40, suggesting potential upside of 38.42% from current levels. These analyst ratings may shift following the company’s latest financial results.
DocuSign’s continued ability to exceed quarterly expectations could help rebuild investor confidence in the company’s long-term growth trajectory.
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