DocuSign Shares Decline After The Company Reports First Quarter Earnings Miss

Shares of electronic signature software company DocuSign were down as much as 24 percent in Thursday’s extended trading after the company reported first-quarter earnings that were lower than expectations.

For the quarter, the company reported earnings of 38 cents per share, below analysts’ expectation of 46 cents per share, according to Refinitiv. For the quarter, revenue came in at $588.7 million surpassing the $581.8 million that analysts had expected according to Refinitiv.

DocuSign also revealed in a statement that for the first quarter which ended on the 30^th of March, its revenue was up 25 percent from the same period a year ago. As investors start to look to profitability instead of a previous focus on growth, the gains it recorded with revenue were masked by its earnings miss. The company’s stock is down about 43 percent this year as of Thursday’s close.

The company also reported a net loss of $27.4 million compared to the $8.3 million it reported in the same period a year ago.

Like many other companies and businesses, DocuSign enjoyed a boom induced by the coronavirus pandemic as the increase in online transactions caused an increase in the need for its services. This boom has, however, slowed down in the recent quarter.

The company’s CEO Dan Springer, while on a conference call with analysts said that the company its now working to fix go-to-market challenges, just after it was beginning to adjust its sales approach to help increase demand.

The company, like many others, will be slowing down on hiring new talents. The company is also faced with macroeconomic challenges like many others. According to the company’s chief financial officer Cynthia Gaylor, the company’s expansion rate has slowed and the Russia-Ukraine war continues to pose a threat to growth.

For the second quarter, DocuSign says it expects revenue to come in between $600 million and $604 million. Analysts expect revenue to come at $601.7 million, according to Refinitiv. For the full year, the company envisages revenue of between $2.47 billion and $2.48 billion while analysts expect 42.479 billion, according to Refinitiv.