DocuSign, Inc. ($DOCU) Earnings (Q3 FY23)

DocuSign, Inc. ($DOCU) Earnings and Opinion:


DocuSign is a company in the Technology sector and operates in the Software-Application industry. The company provides electronic software in the United States and internationally. DocuSign was incorporated in 2003 and is currently headquartered in San Francisco, California. The company made its debut on the stock market in 2018. 

DocuSign Earnings Results:

  •  Revenues of $646M beating expectations of $627M
  • Gross Profit of $538M beating expectations of $506M
  • Operating Profit of $147M beating expectations of $108M
  • Adjusted EPS of $0.57 beating expectations of $0.43
Opinion:
DocuSign is moving a slight bit higher, after a solid earnings report was released. Not only was it a win for sales, it was a huge push for profitability. The beat was nice and the margins looked very solid. One thing that is striking is how large the gross profit margin is. They do not have a lot of costs that go into producing the revenue. This is essential, especially for a company that is looking to grow and marketing to grow its customer base. Subscription revenue grew 18% from a year ago. Professional Services revenue grew 27% from a year ago. The growth looks pretty good after some pretty rough recent quarters. With the economy turning the way it is, it will be vital to have profitability and limit borrowing. DocuSign looks to be improving in this area, and I expect the company to continue its growth, as it is the leader in eSignature. The thing I love about this company is its unique product. You do not see many other competitors and with the pandemic making paperwork and things of sort all online. This business came in and proved it could thrive. It has been shunned, as all other tech stocks have, with the interest rates increasing. I am pleased with what the new CEO has been able to accomplish in his short tenure. The company is looking up with him and I like the CEO background with marketing. The company definitely needs to market to grow its customer base, but it needs to maintain customer retention to continue sales. Overall, I could see some upside in the near term with a quarter like this. I expect some analysts to change their ratings on this stock and some momentum will follow. I am long DocuSign $DOCU.


*Information from Yahoo Finance, Consensus Gurus, and Seeking Alpha

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