DocuSign Earnings: What To Look For From DOCU

E-signature company DocuSign (DOCU) will be reporting earnings tomorrow after market close. Here's what to expect.

Last quarter DocuSign reported revenues of $700.4 million, up 8.5% year on year, beating analyst revenue expectations by 1.5%. It was a solid quarter for the company, with billings and revenue exceeding expectations. Looking ahead, next quarter's revenue guidance came in higher than Wall Street's estimates. Profits were also better-than-expected in the quarter, showing not only topline momentum but expense efficiency and leverage. For the full year, guidance was raised across the board.

Is DocuSign buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting DocuSign's revenue to grow 6% year on year to $699.4 million, slowing down from the 13.6% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.65 per share.

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 2.5%.

Looking at DocuSign's peers in the productivity software segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. Box delivered top-line growth of 2.5% year on year, in line with analyst estimates and Dropbox reported revenues up 6% year on year, exceeding estimates by 0.5%. Box was up 5.1% on the results, and Dropbox was down 2%.

Read our full analysis of Box's results here and Dropbox's results here.

Investors in the productivity software segment have had steady hands going into the earnings, with the stocks down on average 1.2% over the last month. DocuSign is up 0.3% during the same time, and is heading into the earnings with analyst price target of $60, compared to share price of $52.3.

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