DocuSign tanks 25% on Q1 results: ‘they’ll be impaired in long term’


DocuSign tanks 25% on Q1 results: ‘they’ll be impaired in long term’

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Wajeeh Khan

Jun 9, 2022

DocuSign Inc reports weaker-than-expected profit for its fiscal first quarter.

Trivariate’s Adam Parker discussed the earnings report on CNBC Closing Bell.

Shares of the company tanked nearly 20% in extended trading on Thursday.

DocuSign Inc (NASDAQ: DOCU) shares tanked nearly 25% in extended trading on weaker-than-expected earnings for its fiscal first quarter.

DocuSign Q1 financial highlights

Lost $27.4 million in Q1 versus the year-ago figure of $8.35 millionPer-share loss of 14 cents was much wider than last year’s 4 centsOn an adjusted basis, EPS stood at 38 cents in the recent fiscal quarterRevenue jumped 25% to $588.7 million, as per the earnings press releaseFactSet consensus was for 46 cents of adjusted EPS on $583 million in revenue

At $613.6 million, billings went up 16% on a year-over-year basis. Including after-hours price action, the stock is down more than 55% for the year.

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Future guidance and expert’s remarks

For the current financial quarter, DocuSign forecast its revenue to fall in the range of $600 million to $604 million. In comparison, experts had forecast $601 million. Discussing the earnings report on CNBC’s “Closing Bell”, Trivariate Research’s Adam Parker said:

We use Microsoft for everything. From Team, to Excel, to Azure. If they decided to put a docusign button on, I don’t see why you would ever use DocuSign. So, I don’t see the technological moat. That’s why, ultimately, they’ll be impaired in the long term.

DocuSign has more than 1.0 billion users worldwide, at present. It ended the quarter with $1.06 billion in cash, equivalents, restricted cash and investments.

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