Docusign (NASDAQ:DOCU) delivered stronger-than-expected third-quarter results on Thursday, though its shares slipped more than 5% in Friday’s premarket session after the company issued revenue guidance that largely matched analysts’ forecasts.
The digital signature and identity management firm reported Q3 earnings of $1.01 per share, outperforming the consensus estimate of $0.91. Revenue came in at $818.4 million, ahead of the projected $807.09 million.
Billings also increased 10% year over year, coming in slightly above the 10% growth the Street had anticipated.
Jefferies analysts highlighted that “billings beat [expectations] again despite guided caution about early renewal headwinds.” They reiterated their view that DocuSign is positioned “as an attractive mid-cap reacceleration story and believe top-line growth could sustainably be high single digit over the medium term as IAM ramps and DOCU continues to upsell into their install base.”
CEO Allan Thygesen said performance was boosted by “growing customer investment into the IAM platform” as well as “continued strong execution and improved efficiency,” which combined to produce one of DocuSign’s strongest quarters for growth and profitability in the past two years.
For fiscal 2026, Docusign now expects revenue between $3.208 billion and $3.212 billion—an increase of roughly $15 million at the midpoint and essentially aligned with analyst expectations of $3.2 billion.
The company also lifted the midpoint of its billings forecast by $44 million. Beginning in fiscal 2027, however, Docusign will no longer report or guide billings, transitioning instead to annual recurring revenue (ARR) as its main performance metric. The IAM portion of ARR will be broken out regularly.
Jefferies analysts said the shift should “help reduce volatility caused by the billings metric,” noting that billing patterns are often skewed by early contract renewals and do not fully reflect the company’s operating priorities. “While any guidance metric change can be disconcerting to investors, we think this makes sense and aligns with how DOCU manages its business,” they wrote.