DocuSign stock falls despite better-than-expected earnings, guidance

DocuSign Inc (NASDAQ:DOCU) reported better-than-expected second-quarter earnings and revenue but saw its shares drop 6% in after-hours trading as the company's guidance failed to impress investors.

The e-signature and agreement cloud company posted adjusted earnings per share of $0.97, surpassing analyst estimates of $0.81. Revenue for the quarter reached $736 million, up 7% YoY and exceeding the consensus forecast of $727.2 million.

Despite the strong quarterly performance, DocuSign's forward guidance appeared to underwhelm the market. The company projected third-quarter revenue between $743 million and $747 million, slightly above the analyst consensus of $739.4 million.

For the full fiscal year 2025, DocuSign expects revenue in the range of $2.94 billion to $2.952 billion, marginally higher than the $2.93 billion consensus estimate.

CEO Allan Thygesen highlighted the company's progress, stating, "DocuSign continued its evolution with improved business stability and increased efficiency, resulting in record operating profit." He also noted the launch of the company's Intelligent Agreement Management platform, expressing optimism about early results and customer feedback.

The company's subscription revenue, which forms the bulk of its income, grew 7% YoY to $717.4 million. Billings, a key metric for future revenue, increased by 2% YoY to $724.5 million.

The company also reported strong cash flow, with net cash provided by operating activities reaching $220.2 million.