DocuSign Shares Gain 22% After Posting Q3 Earnings & Revenue Beat

DocuSign, Inc. DOCU reported impressive third-quarter fiscal 2025 results, wherein earnings per share (EPS) and revenues outpaced the Zacks Consensus Estimate.See Zacks Earnings Calendar to stay ahead of market-making news.The earnings beat and the raised revenue guidance impressed the investors, as the stock has rallied 22.2% since the company released results on Dec. 5.For fiscal 2025, the company raised its revenue guidance to $2.95-$2.96 billion from the prior quarter’s view of $2.94-$2.95 billion. The current Zacks Consensus Estimate for revenues is pegged at $2.95 billion. The present estimate meets the lower end of the company’s raised guided range.DOCU’s EPS (excluding 60 cents from non-recurring items) was 90 cents, which surpassed the Zacks Consensus Estimate by 4.7% and increased 13.9% from the year-ago quarter. Total revenues of $754.8 million beat the consensus mark by 1.4% and gained 7.8% from third-quarter fiscal 2024.The company’s shares have gained 84.9% in the past three months compared with the 23.2% rise of the industry it belongs to and 10.5% growth of the Zacks S&P 500.Docusign Inc. Price, Consensus and EPS Surprise Docusign Inc. price-consensus-eps-surprise-chart | Docusign Inc. QuoteDOCU’s Segmental RevenuesSubscription revenues totaled $734.7 million, increasing 7.8% year over year. The figure beat our estimate of $722.1 million. Professional services and other revenues of $20.1 million gained 11.3% from the year-ago quarter, missing our expectation of $21.3 million. Billings amounted to $752.3 million, up 9% from the year-ago quarter. The figure surpassed our anticipation of $716.5 million.The non-GAAP gross margin was 82.5%, beating our estimate of 81.2%. The non-GAAP gross profit of $622.3 million grew 7% year over year and outpaced our expectation of $601.8 million. The non-GAAP operating margin was 29.6%, increasing by 280 basis points from the year-ago quarter. It beat our estimate of 28.5%.Balance Sheet & Cash Flow of DocuSignDocuSign exited third-quarter fiscal 2025 with cash and cash equivalents of $610.9 million compared with $619.1 million at the end of the fiscal second quarter. Net cash generated by operating activities was $234.3 million for the reported quarter. The free cash flow generated was $210.7 million.DOCU’s Q4 & FY25 GuidanceFor the fourth quarter of fiscal 2025, the company expects revenues between $758 and $762 million. This guided range is higher than the current consensus estimate of $755.4 million.DOCU anticipates subscription revenues in the range of $741-$745 million and billing revenues between $870 million and $880 million. The non-GAAP gross margin and the non-GAAP operating margin are expected to be 81-82% and 27.5-28.5%, respectively.For fiscal 2025, subscription revenue guidance was raised to $2.885-$2.889 billion from $2.86-$2.87 billion provided in the previous quarter. Billings’ guidance increased to $3.05-$3.06 billion from the preceding quarter’s view of $2.99-$3.03 billion. The non-GAAP gross margin and the non-GAAP operating margin are expected to be 81.9-82.1% and 29.5-29.5.7%, respectively.Currently, DocuSign carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Earnings Snapshot of DOCU’s PeersRepublic Services, Inc. RSG reported mixed third-quarter 2024 results.RSG’s EPS (excluding 1 cent from non-recurring items) of $1.8 outpaced the Zacks Consensus Estimate by 11.7% and grew 17.5% from the year-ago quarter. Revenues of $4.1 billion missed the consensus mark by a slight margin but increased 6.5% on a year-over-year basis.Corpay CPAY reported impressive third-quarter 2024 results.CPAY’s EPS of $5 beat the consensus estimate by a slight margin and increased 11.4% on a year-over-year basis. Total revenues of $1 billion outpaced the consensus estimate marginally and grew 6% from the year-ago quarter.Zacks Naming Top 10 Stocks for 2025Want to be tipped off early to our 10 top picks for the entirety of 2025?History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2024, the Zacks Top 10 Stocks gained +2,112.6%, more than QUADRUPLING the S&P 500’s +475.6%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2025. Don’t miss your chance to get in on these stocks when they’re released on January 2.Be First to New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Republic Services, Inc. (RSG): Free Stock Analysis Report Docusign Inc. (DOCU): Free Stock Analysis Report Corpay, Inc. (CPAY): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks