Docusign (DOCU) Q2 2027 Financial Results Summary
QuoteReporter
Docusign, Inc. (DOCU) Q2 2027: Revenue Growth and Increased Guidance — Positive Outlook
Docusign, Inc. (NASDAQ: DOCU) reported its second fiscal quarter results for the period ending July 31, 2026, revealing a revenue of $875.7 million, which represents a $75.1 million or +9% increase year-over-year. This growth is notable as it includes a foreign exchange benefit of approximately 1.3%.
Overall, this quarter can be viewed positively for shareholders. The revenue growth, coupled with improvements in net income and cash flow metrics, indicates a strengthening business performance. The company also raised its fiscal year 2027 guidance, reflecting confidence in its growth trajectory.
Key Financial Metrics:
- Revenue: $875.7 million, up $75.1 million or +9% YoY
- GAAP Net Income:
- Basic EPS: $0.41 (up from $0.31 YoY)
- Diluted EPS: $0.40 (up from $0.30 YoY)
- Non-GAAP Net Income per Diluted Share: $1.16 (up from $0.92 YoY)
- Free Cash Flow: $295.8 million, or a 34% margin, compared to $217.6 million, or 27% margin, in the same period last year.
- Net Cash Provided by Operating Activities: $334.5 million, up from $246.1 million YoY.
- Repurchases of Common Stock: $306.5 million, compared to $201.5 million in the same period last year.
Business Highlights:
- Intelligent Agreement Management (IAM): Represented 15.1% of total Annual Recurring Revenue (ARR) as of July 31, 2026, up from 12.6% as of April 30, 2026.
- Gross Margin: GAAP gross margin was 79.7%, compared to 79.3% in the same period last year. Non-GAAP gross margin was 81.7%, down from 82.0% YoY.
Guidance Update:
Docusign has increased its fiscal year 2027 guidance:
- Revenue Guidance: $3,499 million to $3,507 million, reflecting a 9% year-over-year growth.
- Non-GAAP Gross Margin Guidance: 81.5% to 82.0%.
- Annual Recurring Revenue Growth Rate: Expected to be 8.50% to 9.00%.
Analyst Opinion:
This quarter's results are encouraging for shareholders, showcasing a solid revenue increase and improved profitability metrics. The increase in guidance suggests that Docusign is well-positioned to capitalize on the growing demand for its services, particularly in the realm of AI-driven solutions. The company's focus on enhancing its IAM capabilities and integrating AI into its offerings is likely to drive further growth.
Forward Catalyst:
Investors should closely monitor Docusign's performance in the upcoming quarter, particularly the adoption rates of its IAM solutions and the impact of AI on its business operations. Additionally, any updates on customer acquisition and retention strategies will be crucial as the company aims to expand its market share in the digital agreement space.
Here are the extracted tables:
Note: All amounts in the following tables are in thousands.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| Three Months Ended | Six Months Ended | |||
|---|---|---|---|---|
| July 31, 2026 | July 31, 2025 | July 31, 2026 | July 31, 2025 | |
| Revenue | $ 875,746 | $ 800,636 | $ 1,705,… | $ 1,564,2… |
| Cost of revenue | 177,872 | 165,463 | 349,142 | 322,732 |
| Gross profit | 697,874 | 635,173 | 1,356,… | 1,241,5… |
| Operating expenses | ||||
| Sales and marketing | 313,958 | 305,450 | 610,133 | 601,863 |
| Research and development | 163,582 | 169,630 | 323,168 | 329,077 |
| General and administrative | 102,713 | 94,866 | 194,608 | 185,136 |
| Total operating expenses | 580,253 | 569,946 | 1,127,… | 1,116,0… |
| Income from operations | 117,621 | 65,227 | 228,930 | 125,482 |
| Interest expense | -569 | -828 | -1,120 | -1,306 |
| Interest income and other income, net | 7,924 | 12,061 | 14,922 | 26,074 |
| Income before provision for income taxes | 124,976 | 76,460 | 242,732 | 150,250 |
| Provision for income taxes | 47,261 | 13,490 | 86,820 | 15,193 |
| Net income | $ 77,715 | $ 62,970 | $ 155,912 | $ 135,057 |
| Net income per share attributable to common stock: | ||||
| Basic | $ 0.41 | $ 0.31 | $ 0.81 | $ 0.67 |
| Diluted | $ 0.40 | $ 0.30 | $ 0.80 | $ 0.64 |
| Weighted-average shares used to compute net income per share: | ||||
| Basic | 191,252 | 202,644 | 193,336 | 202,957 |
| Diluted | 193,117 | 210,956 | 194,763 | 211,878 |
| Stock-based compensation expense included in costs and expenses | ||||
| Cost of revenue | $ 15,241 | $ 18,592 | $ 30,550 | $ 35,496 |
| Sales and marketing | 46,828 | 49,081 | 89,854 | 95,166 |
| Research and development | 55,502 | 61,865 | 109,978 | 116,296 |
| General and administrative | 31,033 | 31,000 | 59,599 | 59,176 |
CONDENSED CONSOLIDATED BALANCE SHEETS
| July 31, 2026 | January 31, 2026 | |
|---|---|---|
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | $ 528,161 | $ 602,442 |
| Investments—current | 249,516 | 264,084 |
| Accounts receivable, net | 370,531 | 516,429 |
| Contract assets—current | 7,552 | 10,782 |
| Prepaid expenses and other current assets | 113,132 | 97,101 |
| Total current assets | 1,268,892 | 1,490,838 |
| Investments—noncurrent | 195,398 | 208,393 |
| Property and equipment, net | 420,032 | 361,808 |
| Operating lease right-of-use assets | 155,101 | 165,578 |
| Goodwill | 458,365 | 458,446 |
| Intangible assets, net | 51,924 | 61,394 |
| Deferred contract acquisition costs—noncurrent | 468,812 | 474,628 |
| Deferred tax assets—noncurrent | 764,330 | 835,245 |
| Other assets—noncurrent | 177,936 | 173,220 |
| Total assets | $ 3,960,790 | $ 4,229,550 |
| Liabilities and Equity | ||
| Current liabilities | ||
| Accounts payable | $ 21,866 | $ 17,419 |
| Accrued expenses and other current liabilities | 121,046 | 113,358 |
| Accrued compensation | 239,042 | 260,840 |
| Contract liabilities—current | 1,575,565 | 1,631,168 |
| Operating lease liabilities—current | 15,516 | 16,623 |
| Total current liabilities | 1,973,035 | 2,039,408 |
| Contract liabilities—noncurrent | 28,824 | 29,956 |
| Operating lease liabilities—noncurrent | 167,582 | 168,496 |
| Deferred tax liability—noncurrent | 20,960 | 21,507 |
| Other liabilities—noncurrent | 51,869 | 52,363 |
| Total liabilities | 2,242,270 | 2,311,730 |
| Stockholders’ equity | ||
| Common stock | 19 | 20 |
| Additional paid-in capital | 4,052,431 | 3,777,995 |
| Accumulated other comprehensive loss | -7,843 | -3,712 |
| Accumulated deficit | -2,326,087 | -1,856,483 |
| Total stockholders’ equity | 1,718,520 | 1,917,820 |
| Total liabilities and equity | $ 3,960,790 | $ 4,229,550 |
Disclaimer
The content on MarketsFN.com is provided for educational and informational purposes only. It does not constitute financial advice, investment recommendations, or trading guidance. All investments carry risk and past performance does not guarantee future results. You are solely responsible for your investment decisions and should conduct independent research and consult a qualified financial advisor before acting. MarketsFN.com and its authors are not liable for any losses or damages arising from the use of this information.