DOCU Stock Explodes as DocuSign Earnings Fall but Estimates Top Amid Lower Expectations

DocuSign (DOCU) reported July quarter earnings and revenue that beat estimates amid low expectations. The company’s outlook came in mixed, but DOCU’s stock rose after Friday’s news.


The San Francisco-based software maker reported earnings after the market closed Thursday. DocuSign’s fiscal second-quarter earnings were 44 cents per share, down 6% from a year earlier, but ahead of estimates of 42 cents.

Additionally, the electronic signature software maker said revenue rose 22% to $622.2 million. Analysts expected revenues to reach $602 million. A year ago, DocuSign earnings were 47 cents per share from $512 million in sales.

The Billings Index, a measure of sales growth, rose 9% to $647.7 million versus estimates of $601.8 million.

DOCU stock rose 10.5% to close at 64.04 in stock market today.

DOCU stock: More in-person meetings hit business

For the current quarter ending in October, DocuSign projected revenue of $626 million midway through its forecast and billing of $589 million. Analysts expected third-quarter revenue of $625 million and bills of $593.4 million.

The demand for DocuSign products surged during the early part of the coronavirus outbreak, but many companies are resuming face-to-face meetings. In addition to accommodating electronic signatures, the company’s software also automates the filing of contracts online.

DocuSign has an ongoing search for a new CEO. Board Chair Mary Wilderwater was appointed interim CEO on June 21.

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“We thought the quarter/guideline was better than fear, but we came out with less confidence in the timely transition to healthy growth and were kept in wait-and-see mode until a new CEO,” RBC Capital analyst Rishi Galoria said in a report. . DocuSign has indicated that the company is about to name a new CEO, indicating that mergers and acquisitions are not currently on the table.

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So far in 2022, DOCU’s stock is down 63% as the earnings report approaches. DocuSign holds a relative strength rating of only 5 out of the 99 best possible, according to IBD stock check.

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