DocuSign Earnings: Focus Remains on Platform Innovation and International Opportunity

Narrow-moat DocuSign reported strong fiscal 2024 third-quarter results, with the top line and non-GAAP operating margin exceeding our expectations. Profitability was similarly strong, as disciplined investments are bearing fruit. DocuSign’s operating environment remains difficult as budgets continue to face high scrutiny, with significant headwinds in the financials and real estate verticals. We are encouraged by DocuSign’s focus on broadening platform capabilities through initiatives beyond its flagship eSignature offering, such as contract lifecycle management and a new WhatsApp integration, as well as international expansion efforts. We are maintaining our $74 fair value estimate. The stock appears attractive for long-term investors, but we prefer some of the wide-moat names we cover as macro uncertainty persists.