DocuSign, Inc. (NASDAQ: DOCU), a leader in electronic signature technology and advanced agreement management solutions, recently unveiled its financial performance for the quarter ending October 31, 2023.
For the period, the company showed impressive growth. Its overall revenue totaled $700.4 million, which was a 9% increase from the previous year. The bulk of this, $682.4 million, came from their subscription services, also up by 9%. Despite these gains, the company saw a 16% drop in professional services and other revenues, which totaled $18.1 million.
Another positive, however, was that the business reported a positive net income of $0.19 per share, up from a loss of $0.15 in the same period a year ago. Free cash flow of $240.3 million also soared from just $36.1 million in the prior-year period.
DocuSign's stock has gone from boom to bust in recent years. A favorite during the pandemic, its value has dropped by over 78% since 2021. Despite this, the current financial outcomes might indicate a revival, showcasing the company’s enduring business strength.
The company’s forecast for the coming quarter is cautious, however, with anticipated revenue of $696 million to $700 million showing little change from this quarter. The projected annual revenue is about $2.75 billion, up 9% from last year. Investors are left to consider whether this is a sign of stable growth or a ceiling in the company’s expansion.
The stock is trading at 18 times its estimated future earnings and a PEG ratio slightly over 1, indicating potential value for investors. DocuSign could make for a good buy now that its earnings are better, but investors should be careful not to expect too much from the stock as its high growth days may be over.
