Docusign Announces Third Quarter Fiscal 2026 Financial Results

Rhea-AI Summary

Docusign (NASDAQ: DOCU) reported fiscal Q3 results for the quarter ended October 31, 2025, with revenue $818.4M (+8% YoY) and subscription revenue $801.0M (+9% YoY). Billings were $829.5M (+10% YoY). GAAP diluted EPS was $0.40 and non-GAAP diluted EPS was $1.01 (vs. $0.90 prior year). Operating cash flow was $290.3M and free cash flow was $262.9M. Cash and investments totaled $1.0B, and share repurchases were $215.1M for the quarter.

Business highlights: IAM platform surpassed 25,000 customers, Navigator holds ~150M opted-in agreements, new AI integrations and regional language expansion were announced. Fiscal Q4 and FY26 guidance projects ~7–8% revenue growth.

Positive

• Revenue +8% YoY to $818.4M
• Subscription revenue +9% YoY to $801.0M
• Billings +10% YoY to $829.5M
• Non-GAAP diluted EPS $1.01 (vs. $0.90 prior year)
• Operating cash flow $290.3M (+23.9% YoY)
• Share repurchases $215.1M in the quarter

Negative

• Professional services revenue down 14% YoY to $17.4M

Key Figures

Q3 total revenue $818.4M Quarter ended October 31, 2025; up 8% year-over-year

Q3 billings $829.5M Quarter ended October 31, 2025; up 10% year-over-year

GAAP EPS diluted $0.40 Q3 FY26; 208M diluted shares vs $0.30 last year

Non-GAAP EPS diluted $1.01 Q3 FY26; 208M diluted shares vs $0.90 last year

Free cash flow $262.9M Q3 FY26; up from $210.7M in prior-year quarter

Cash & investments $1.0B Balance at end of Q3 FY26

Q4 revenue guidance $825M–$829M Quarter ending January 31, 2026; 7% YoY midpoint change

FY26 revenue guidance $3,208M–$3,212M Year ending January 31, 2026; 8% YoY midpoint change

Market Reality Check

$70.62 Last Close

Volume Volume 2,249,500 vs 20-day avg 1,948,638 ahead of the earnings release. normal

Technical Shares at $70.62, trading below 200-day MA of $77.39 and 34.53% under 52-week high.

Peers on Argus

Sector peers were mixed: several application software names in the peer list showed modest gains while at least one declined, suggesting DOCU’s pre-news strength of 2.56% was more stock-specific than part of a broad sector move.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Nov 14	Industry recognition	Positive	+1.1%	Gartner named Docusign a CLM Leader for the sixth consecutive year.
Nov 13	Earnings timing	Neutral	+1.1%	Announcement of Q3 FY26 earnings release and conference call schedule.
Nov 13	Product launch	Positive	-3.4%	Launch of Docusign Template Gallery with 40 ready-to-use contract templates.
Nov 05	Industry award	Positive	+0.1%	Recognition as a 2025 Inc. Power Partner highlighting agreement AI capabilities.
Oct 30	AI integration	Positive	+3.8%	IAM platform announced as accessible inside ChatGPT via MCP integration.

Pattern Detected

Recent fundamentally positive news has usually seen positive 24h reactions, with only one notable divergence.

Recent Company History

Over the past six weeks, Docusign has released several positive updates. Recognition as a Leader in Gartner’s CLM Magic Quadrant and inclusion in Inc.’s Power Partner list highlighted its agreement-focused AI strategy. Product moves such as IAM access in ChatGPT and a free contract template gallery emphasized expanding use cases. These announcements generally saw modest positive price reactions, with one negative response to the template launch. Today’s Q3 FY26 earnings continue that theme of steady growth and expanding IAM capabilities.

Historical Comparison

earnings

+15.8 %

Average Historical Move

Historical Analysis

In the past year, DOCU’s three earnings releases saw an average move of 15.81%. Today’s Q3 FY26 report again shows high single-digit revenue growth and rising profitability, broadly consistent with that pattern.

Typical Pattern

Recent earnings show steady high single-digit revenue growth, rising diluted EPS, and continued expansion of the IAM platform with AI-focused features.

Regulatory & Risk Context

Short Interest

3.32%

0% 15% 30%+

low

Short interest is low at 3.32% of float with days to cover at 3.37, suggesting limited potential impact from short-covering dynamics around earnings catalysts.

Market Pulse Summary

This announcement details Q3 FY26 performance with total revenue of $818.4M, billings of $829.5M, and higher GAAP and non-GAAP EPS versus last year alongside free cash flow of $262.9M. Management also issued Q4 and full-year FY26 guidance implying continued high single-digit growth. Recent news flow shows consistent progress in AI-driven IAM capabilities and industry recognition. Investors may watch future billings trends, cash generation, and IAM adoption metrics against this guidance baseline.

Key Terms

Intelligent Agreement Management technical

"growing customer investment into the IAM platform, where we now have more than 25,000 customers"

Intelligent agreement management is the use of technology to create, track, and oversee contracts automatically and efficiently. It helps ensure that all parties follow the terms, deadlines, and conditions without manual effort, reducing errors and delays. For investors, it offers greater transparency and control over contractual commitments, making business dealings more reliable and streamlined.

IAM platform technical

"growing customer investment into the IAM platform, where we now have more than 25,000 customers"

An IAM platform, or Identity and Access Management platform, is a system that helps organizations securely control who can access their digital resources and what they can do with them. It functions like a digital gatekeeper, verifying identities and permissions to prevent unauthorized access. For investors, a reliable IAM platform enhances security and trust, reducing the risk of data breaches and ensuring smooth, safe operations.

billings financial

"Billings were $829.5 million, a 10% year-over-year increase"

Billings represent the total amount of money a company is expected to receive from customers for products or services delivered during a specific period. Think of it as the sales that have been agreed upon or scheduled, even if the cash hasn't been received yet. For investors, billings are an important indicator of future revenue and business growth, showing how well a company is selling its offerings.

non-GAAP gross margin financial

"Non-GAAP gross margin was 81.8% compared to 82.5% in the same period last year."

Non-GAAP gross margin is a measure of a company's profitability that shows how much money it makes from sales after subtracting the direct costs of producing its products or services, but without applying certain accounting adjustments required by standard rules. It helps investors understand the company's core earning ability by excluding items like one-time expenses or accounting changes. This metric provides a clearer picture of ongoing business performance beyond official financial reports.

free cash flow financial

"Free cash flow was $262.9 million compared to $210.7 million in the same period last year."

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

FedRAMP Moderate regulatory

"Docusign achieved FedRAMP Moderate and GovRAMP authorization"

"FedRAMP Moderate" is a security standard set by the U.S. government to ensure cloud services protect sensitive information. It requires organizations to implement robust safeguards, similar to a high-security lock on a safe, to prevent unauthorized access. For investors, it signals that a company handling government data meets strict security requirements, which can indicate reliability and trustworthy practices.

GovRAMP authorization regulatory

"Docusign achieved FedRAMP Moderate and GovRAMP authorization"

GovRAMP authorization is an official approval process that certifies cloud-based technology systems used by government agencies meet strict security standards. It is similar to a safety inspection that ensures sensitive information is protected from cyber threats. For investors, it signals that a technology provider has strong security measures in place, increasing confidence in its reliability and trustworthiness.

Model Context Protocol ("MCP") server technical

"beta release of its Docusign Model Context Protocol ("MCP") server."

A model context protocol ("MCP") server is a system that manages and shares information about different situations or environments within a larger technology network. It acts like a central coordinator, helping various programs understand the current setting so they can work together smoothly. For investors, this ensures that digital services operate reliably and efficiently, which can impact the stability and performance of financial platforms and data systems.

AI-generated analysis. Not financial advice.

SAN FRANCISCO, Dec. 4, 2025 /PRNewswire/ -- Docusign, Inc. (NASDAQ: DOCU) today announced results for its fiscal quarter ended October 31, 2025. Prepared remarks and the news release with the financial results will be accessible on Docusign's website at investor.docusign.com prior to its webcast.

"Q3 was a strong quarter with growing customer investment into the IAM platform, where we now have more than 25,000 customers," said Allan Thygesen, CEO of Docusign. "Continued strong execution and improved efficiency led to one of the most robust top line growth and profitability quarters over the past two years."

Third Quarter Financial Highlights

• Revenue was $818.4 million, a 8% year-over-year increase including approximately 0.5% positive impact from foreign exchange rates. Subscription revenue was $801.0 million, a 9% year-over-year increase. Professional services and other revenue was $17.4 million, a 14% year-over-year decrease.
• Billings were $829.5 million, a 10% year-over-year increase including approximately 0.5% positive impact of foreign currency exchange rates.
• GAAP gross margin was 79.2% compared to 79.3% in the same period last year. Non-GAAP gross margin was 81.8% compared to 82.5% in the same period last year.
• GAAP net income per basic share was $0.41 on 202 million shares outstanding compared to $0.31 on 204 million shares outstanding in the same period last year.
• GAAP net income per diluted share was $0.40 on 208 million shares outstanding compared to $0.30 on 209 million shares outstanding in the same period last year.
• Non-GAAP net income per diluted share was $1.01 on 208 million shares outstanding compared to $0.90 on 209 million shares outstanding in the same period last year.
• Net cash provided by operating activities was $290.3 million compared to $234.3 million in the same period last year.
• Free cash flow was $262.9 million compared to $210.7 million in the same period last year.
• Cash, cash equivalents, and investments were $1.0 billion at the end of the quarter.
• Repurchases of common stock were $215.1 million compared to $172.7 million in the same period last year.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures and Other Key Metrics."

Key Business Highlights 

Docusign Intelligent Agreement Management ("IAM") Platform Highlights:

• Docusign surpassed 25,000 customers on its AI-native IAM platform. Those customers have approximately 150 million opted-in agreements in the Docusign Navigator repository, with an average of over 5,000 contracts per customer.

New Capabilities within the IAM Platform:

• Docusign AI ecosystem integrations: At its October Docusign Discover'25 developer event, Docusign announced that IAM will be available in ChatGPT, and is now available in Anthropic Claude, Gemini Enterprise, GitHub Copilot, and Microsoft Copilot studio in a beta release of its Docusign Model Context Protocol ("MCP") server.
• Navigator API and Maestro API: Also launched at Discover, Docusign Navigator and Maestro APIs allow developers to connect third-party systems and proprietary internal apps to the industry-leading Navigator repository and Maestro workflow builder.
• Docusign for Agentforce: Announced during Salesforce's Dreamforce conference in October, Docusign for Agentforce integrates agreement generation, management, and AI-powered insights directly into Salesforce to accelerate deal cycles and boost sales team productivity.
• Enterprise Trust and Security: In Q3, Docusign achieved FedRAMP Moderate and GovRAMP authorization, while also expanding its identity portfolio by launching ID Verification with CLEAR and Risk-Based Verification.
• Docusign Navigator Language + Regional Expansion: Navigator is now available in two additional languages – Brazilian-Portuguese and Spanish – and in one additional region – Japan.

Industry Recognition:

• Gartner CLM Magic Quadrant 2025: Gartner named Docusign CLM as a Leader in its Magic Quadrant for Contract Lifecycle Management for the sixth year in a row.
• 2025 Fortune 50 List: In September, Docusign's AI innovation was recognized in the 2025 Fortune Future 50 list, which celebrates companies with the greatest long-term growth prospects.
• Inc. Power Partners Awards: In November, Docusign was named a 2025 Inc. Power Partner Award winner, which recognizes companies that have proven track records supporting entrepreneurs and helping startups grow.
• Salesforce Partner Innovation Award: During Dreamforce, Docusign received a Salesforce Partner Innovation Award in the tech category for the Docusign for Agentforce solution.

Guidance

The company currently expects the following guidance:

(in millions, except percentages)	Three Months Ended January 31, 2026				YoY Midpoint Change
Total revenue [1]	$825	to	$829		7 %
Subscription revenue	$808	to	$812		7 %
Billings [2]	$992	to	$1,002		8 %
Non-GAAP gross margin	80.8 %	to	81.2 %		NA
Non-GAAP operating margin	28.3 %	to	28.7 %		NA
Non-GAAP diluted weighted-average shares outstanding	203	to	208		NA
(in millions, except percentages)	Year Ended January 31, 2026				YoY Midpoint Change
Total revenue [1]	$3,208	to	$3,212		8 %
Subscription revenue	$3,140	to	$3,144		8 %
Billings [2]	$3,379	to	$3,389		9 %
Non-GAAP gross margin	81.7 %	to	81.8 %		NA
Non-GAAP operating margin	29.8 %	to	29.9 %		NA
Non-GAAP diluted weighted-average shares outstanding	208	to	211		NA

[1] Excluding the impact of foreign currency exchange rates on year-over-year guided revenue growth, revenue guidance range would be approximately 0.7% points lower for the quarter ending January 31, 2026 and approximately neutral for the fiscal year ending January 31, 2026.

[2] Excluding the impact of foreign currency exchange rates on year-over-year guided growth, billings guidance range would be approximately 1.6% points lower for the quarter ending January 31, 2026 and approximately 0.9% points lower for the fiscal year ending January 31, 2026.

A reconciliation of non-GAAP guidance measures to corresponding GAAP guidance measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future. Stock-based compensation-related charges, including employer payroll tax-related items on employee stock transactions, are impacted by many factors, including the timing of employee stock transactions, the future fair market value of our common stock, and our future hiring and retention needs, all of which are difficult to predict and subject to constant change. We have provided a reconciliation of GAAP to non-GAAP financial measures in the financial statement tables for our historical non-GAAP financial results included in this release.

Webcast Conference Call Information

The company will host a conference call on December 4, 2025 at 2:00 p.m. PST (5:00 p.m. EST) to discuss its financial results. A live webcast of the event will be available on the Docusign Investor Relations website at investor.docusign.com. Prepared remarks and the news release with the financial results will also be accessible on Docusign's website prior to the webcast. A live dial-in will be available domestically at 877-407-0784 or internationally at 201-689-8560. A replay will be available domestically at 844-512-2921 or internationally at 412-317-6671 until midnight (EST) December 18, 2025 using the passcode 13756132.

About Docusign

Docusign brings agreements to life. Nearly 1.8 million customers and more than a billion people in over 180 countries use Docusign solutions to accelerate the process of doing business and simplify people's lives. With intelligent agreement management, Docusign unleashes business critical data that is trapped inside of documents. Until now, these were disconnected from business systems of record, costing businesses time, money, and opportunity. Using Docusign's IAM platform, companies can create, commit, and manage agreements with solutions created by the #1 company in e-signature and CLM. Learn more at www.docusign.com.

Copyright 2025. Docusign, Inc. is the owner of DOCUSIGN® and all its other marks (www.docusign.com/IP).

Investor Relations:
Docusign Investor Relations
investors@docusign.com 

Media Relations:
Docusign Corporate Communications
media@docusign.com 

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are based on our management's beliefs and assumptions and on information currently available to management, and which statements involve substantial risk and uncertainties. All statements contained in this press release other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans, market growth and trends, objectives for future operations, and the impact of such assumptions on our financial condition and results of operations are forward-looking statements. Forward-looking statements in this press release also include, among other things, statements under "Guidance" above and any other statements about expected financial metrics, such as revenue, billings, free cash flow, non-GAAP gross margin, non-GAAP operating margin, non-GAAP operating expenses, and non-financial metrics, as well as statements related to our expectations regarding: the impact of foreign exchange rates; the timing and extent of customer renewals; the effectiveness of changes to our sales force and go-to-market strategy; the effects of seasonality; the timing and impact of our cloud migration transition; the benefits, the timing or rollout of future products and capabilities; customer demand and adoption of the Docusign IAM platform; and our utilization of our stock repurchase program, including the expected timing, duration, volume and nature of share repurchase under such program. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential," or "continue" or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions.

Forward-looking statements contained in this press release include, but are not limited to, statements about: our expectations regarding global macro-economic conditions, including the effects of inflation, volatile interest rates or foreign exchange rates, and market volatility on the global economy; our inability to accurately estimate our market opportunity; our ability to compete effectively in an evolving and competitive market; the impact of any interruptions or delays in performance of our technical infrastructure, or data breaches, cyberattacks or other fraudulent or malicious activity attempting to exploit our technology systems, platform or brand name; our ability to effectively sustain and manage our growth and future expenses and maintain or increase profitability; our ability to attract new customers and retain and expand our existing customer base, including our ability to attract large organizations as users; our ability to scale and update our platform to respond to customers' needs and rapid technological change, including our ability to successfully incorporate generative artificial intelligence into our existing and future products and to successfully deploy them; our ability to successfully develop, launch and sell IAM solutions; our ability to expand use cases within existing customers and vertical solutions; our ability to expand our operations and increase adoption of our platform internationally; our ability to strengthen and foster our relationships with developers; our ability to retain our direct sales force, customer success team and strategic partnerships around the world; our ability to identify targets for and execute potential acquisitions and to successfully integrate and realize the anticipated benefits of such acquisitions; our ability to maintain, protect and enhance our brand; the sufficiency of our cash, cash equivalents and capital resources to satisfy our liquidity needs; limitations on us due to obligations we have under our credit facility; our ability to realize the anticipated benefits of our stock repurchase program; our failure or the failure of our software to comply with applicable industry standards, laws and regulations; our ability to maintain, protect and enhance our intellectual property; our ability to successfully defend litigation against us; our ability to maintain our corporate culture; our ability to offer high-quality customer support; our ability to hire, retain and motivate qualified personnel, including executive level management; our ability to successfully manage and integrate executive management transitions; uncertainties regarding the impact of general economic and market conditions, including as a result of geopolitical conflict or changes in trade policies and practices; and our ability to maintain proper and effective internal controls.

Additional risks and uncertainties that could affect our financial results are included in the sections titled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our annual report on Form 10-K for the fiscal year ended January 31, 2025, filed on March 18, 2025, our quarterly report on Form 10-Q for the quarter ended October 31, 2025, which we expect to file on December 5, 2025 with the Securities and Exchange Commission (the "SEC"), and other filings that we make from time to time with the SEC. The forward-looking statements made in this press release relate only to events as of the date on which such statements are made. We undertake no obligation to update any forward-looking statements after the date of this press release or to conform such statements to actual results or revised expectations, except as required by law.

Non-GAAP Financial Measures and Other Key Metrics

To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use certain non-GAAP financial measures, as described below, to understand and evaluate our core operating performance. These non-GAAP financial measures, which may be different than similarly-titled measures used by other companies, are presented to enhance investors' overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance and future prospects, and allow for greater transparency with respect to important metrics used by our management for financial and operational decision-making. We present these non-GAAP measures to assist investors in seeing our financial performance using a management view, and because we believe that these measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry. However, these non-GAAP measures are not intended to be considered in isolation from, a substitute for, or superior to our GAAP results.

Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP income from operations, non-GAAP operating margin, non-GAAP net income and non-GAAP net income per share: We define these non-GAAP financial measures as the respective GAAP measures, excluding expenses related to stock-based compensation, employer payroll tax on employee stock transactions, amortization of acquisition-related intangibles, acquisition-related expenses, restructuring and other related charges, as these costs are not reflective of ongoing operations and, as applicable, other special items. The amount of employer payroll tax-related items on employee stock transactions is dependent on our stock price and other factors that are beyond our control and do not correlate to the operation of the business. When evaluating the performance of our business and making operating plans, we do not consider these items (for example, when considering the impact of equity award grants, we place a greater emphasis on overall stockholder dilution rather than the accounting charges associated with such grants). We believe it is useful to exclude these expenses in order to better understand the long-term performance of our core business and to facilitate comparison of our results to those of peer companies and over multiple periods. In addition to these exclusions, we subtract an assumed provision for income taxes to calculate non-GAAP net income. We utilize a fixed long-term projected tax rate in our computation of the non-GAAP income tax provision to provide better consistency across the reporting periods. We have determined the projected non-GAAP tax rate to be 20% for fiscal 2025 and 21% for fiscal 2026 due to the impact of the One Big Beautiful Bill Act.

Free cash flow: We define free cash flow as net cash provided by operating activities less purchases of property and equipment. We believe free cash flow is an important liquidity measure of the cash that is available (if any), after purchases of property and equipment, for operational expenses, investment in our business, and to make acquisitions. Free cash flow is useful to investors as a liquidity measure because it measures our ability to generate or use cash in excess of our capital investments in property and equipment. Once our business needs and obligations are met, cash can be used to maintain a strong balance sheet and invest in future growth.

Billings: We define billings as total revenues plus the change in our contract liabilities and refund liability less contract assets and unbilled accounts receivable in a given period. Billings reflects sales to new customers plus subscription renewals and additional sales to existing customers. Only amounts invoiced to a customer in a given period are included in billings. We believe billings can be used to measure our periodic performance, when taking into consideration the timing aspects of customer renewals, which represents a large component of our business. Given that most of our customers pay in annual installments one year in advance, but we typically recognize a majority of the related revenue ratably over time, we use billings to measure and monitor our ability to provide our business with the working capital generated by upfront payments from our customers.

For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure, please see "Reconciliation of GAAP to Non-GAAP Financial Measures" below.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands, except per share data)	2025		2024		2025		2024
Revenue:
Subscription	$    800,958		$    734,693		$ 2,331,548		$ 2,143,542
Professional services and other	17,392		20,127		51,092		56,945
Total revenue	818,350		754,820		2,382,640		2,200,487
Cost of revenue:
Subscription	150,372		134,587		431,812		393,561
Professional services and other	20,174		21,950		61,466		67,887
Total cost of revenue	170,546		156,537		493,278		461,448
Gross profit	647,804		598,283		1,889,362		1,739,039
Operating expenses:
Sales and marketing	296,516		290,597		898,379		859,705
Research and development	167,626		151,101		496,703		432,992
General and administrative	98,307		97,555		283,443		277,162
Restructuring and other related charges	—		—		—		29,721
Total operating expenses	562,449		539,253		1,678,525		1,599,580
Income from operations	85,355		59,030		210,837		139,459
Interest expense	(654)		(462)		(1,960)		(1,150)
Interest income and other income, net	10,828		13,006		36,902		41,745
Income before provision for (benefit from) income taxes	95,529		71,574		245,779		180,054
Provision for (benefit from) income taxes	11,804		9,151		26,997		(804,340)
Net income	$      83,725		$      62,423		$    218,782		$    984,394
Net income per share attributable to common stockholders:
Basic	$         0.41		$         0.31		$         1.08		$         4.81
Diluted	$         0.40		$         0.30		$         1.04		$         4.69
Weighted-average shares used in computing net income per share:
Basic	201,954		203,567		202,619		204,674
Diluted	208,069		208,706		210,605		209,755
Stock-based compensation expense included in costs and expenses:
Cost of revenue—subscription	$      15,018		$      14,862		$      42,439		$      44,636
Cost of revenue—professional services and other	3,992		4,765		12,067		14,465
Sales and marketing	48,018		49,347		143,184		154,396
Research and development	60,806		53,184		177,102		150,816
General and administrative	32,808		31,070		91,984		91,239
Restructuring and other related charges	—		—		—		4,836

 

CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)	October 31, 2025		January 31, 2025
Assets
Current assets
Cash and cash equivalents	$              583,291		$              648,623
Investments—current	256,580		314,924
Accounts receivable, net	354,978		429,582
Contract assets—current	8,978		13,764
Prepaid expenses and other current assets	103,328		82,368
Total current assets	1,307,155		1,489,261
Investments—noncurrent	208,529		134,105
Property and equipment, net	343,636		299,370
Operating lease right-of-use assets	133,183		109,630
Goodwill	457,247		454,477
Intangible assets, net	60,816		76,388
Deferred contract acquisition costs—noncurrent	462,552		467,201
Deferred tax assets—noncurrent	838,694		840,470
Other assets—noncurrent	170,227		141,803
Total assets	$           3,982,039		$           4,012,705
Liabilities and Equity
Current liabilities
Accounts payable	$                22,482		$                30,697
Accrued expenses and other current liabilities	119,841		99,579
Accrued compensation	180,982		227,115
Contract liabilities—current	1,444,599		1,455,442
Operating lease liabilities—current	15,840		19,077
Total current liabilities	1,783,744		1,831,910
Contract liabilities—noncurrent	28,027		21,523
Operating lease liabilities—noncurrent	134,533		105,350
Deferred tax liability—noncurrent	18,497		20,596
Other liabilities—noncurrent	35,717		30,634
Total liabilities	2,000,518		2,010,013
Stockholders' equity
Common stock	20		20
Treasury stock	(3,387)		(2,871)
Additional paid-in capital	3,665,653		3,321,242
Accumulated other comprehensive loss	(12,045)		(28,376)
Accumulated deficit	(1,668,720)		(1,287,323)
Total stockholders' equity	1,981,521		2,002,692
Total liabilities and equity	$           3,982,039		$           4,012,705

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands)	2025		2024		2025		2024
Cash flows from operating activities:
Net income	$   83,725		$   62,423		$ 218,782		$  984,394
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	30,399		27,569		89,648		79,097
Amortization of deferred contract acquisition and fulfillment costs	68,374		61,264		203,510		172,731
Amortization of debt discount and transaction costs	167		138		607		415
Non-cash operating lease costs	4,804		4,601		14,168		14,463
Stock-based compensation expense	160,642		153,228		466,776		460,388
Deferred income taxes	(2,347)		6,675		(815)		(817,886)
Other	634		1,149		2,139		6,472
Changes in operating assets and liabilities:
Accounts receivable	707		7,120		71,036		130,691
Prepaid expenses and other current assets	2,928		8,767		(20,079)		(8,300)
Deferred contract acquisition and fulfillment costs	(67,266)		(83,293)		(195,254)		(214,548)
Other assets	1,034		(1,060)		(301)		(16,118)
Accounts payable	12,477		10,061		(8,317)		(1,514)
Accrued expenses and other liabilities	19,178		1,014		23,978		(7,146)
Accrued compensation	(28,772)		(21,226)		(53,009)		(41,128)
Contract liabilities	8,610		95		(9,664)		(16,431)
Operating lease liabilities	(5,020)		(4,199)		(15,419)		(16,220)
Net cash provided by operating activities	290,274		234,326		787,786		709,360
Cash flows from investing activities:
Cash paid for acquisition, net of acquired cash	—		—		—		(143,611)
Purchases of marketable securities	(109,398)		(110,296)		(321,598)		(333,537)
Maturities of marketable securities	99,486		90,211		308,458		265,834
Purchases of strategic and other investments	(462)		—		(562)		(625)
Purchases of property and equipment	(27,374)		(23,613)		(79,423)		(68,646)
Net cash used in investing activities	(37,748)		(43,698)		(93,125)		(280,585)
Cash flows from financing activities:
Payment of revolving credit facility costs	—		—		(3,133)		—
Repurchases of common stock	(215,057)		(172,665)		(600,002)		(521,803)
Payment of tax withholding obligation on net RSU settlement and ESPP purchase	(74,254)		(51,051)		(206,211)		(132,134)
Proceeds from exercise of stock options	80		10,257		1,250		11,346
Proceeds from employee stock purchase plan	18,770		15,124		40,780		35,314
Net cash used in financing activities	(270,461)		(198,335)		(767,316)		(607,277)
Effect of foreign exchange on cash, cash equivalents and restricted cash	1,922		438		13,374		(2,239)
Net decrease in cash, cash equivalents and restricted cash	(16,013)		(7,269)		(59,281)		(180,741)
Cash, cash equivalents and restricted cash at beginning of period (1)	616,286		628,027		659,554		801,499
Cash, cash equivalents and restricted cash at end of period (1)	$ 600,273		$ 620,758		$ 600,273		$  620,758

(1) Cash, cash equivalents and restricted cash included restricted cash of $17.0 million and $10.9 million at October 31, 2025 and January 31, 2025.

 

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Unaudited)
Reconciliation of gross profit (loss) and gross margin:
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands)	2025		2024		2025		2024
GAAP gross profit	$   647,804		$   598,283		$  1,889,362		$  1,739,039
Add: Stock-based compensation	19,010		19,627		54,506		59,101
Add: Employer payroll tax on employee stock transactions	1,180		894		4,628		2,733
Add: Amortization of acquisition-related intangibles	1,495		3,566		6,622		8,703
Non-GAAP gross profit	$   669,489		$   622,370		$  1,955,118		$  1,809,576
GAAP gross margin	79.2 %		79.3 %		79.3 %		79.0 %
Non-GAAP adjustments	2.6 %		3.2 %		2.8 %		3.2 %
Non-GAAP gross margin	81.8 %		82.5 %		82.1 %		82.2 %
GAAP subscription gross profit	$   650,586		$   600,106		$  1,899,736		$  1,749,981
Add: Stock-based compensation	15,018		14,862		42,439		44,636
Add: Employer payroll tax on employee stock transactions	889		574		3,554		1,961
Add: Amortization of acquisition-related intangibles	1,495		3,566		6,622		8,703
Non-GAAP subscription gross profit	$   667,988		$   619,108		$  1,952,351		$  1,805,281
GAAP subscription gross margin	81.2 %		81.7 %		81.5 %		81.6 %
Non-GAAP adjustments	2.2 %		2.6 %		2.2 %		2.6 %
Non-GAAP subscription gross margin	83.4 %		84.3 %		83.7 %		84.2 %
GAAP professional services and other gross loss	$     (2,782)		$     (1,823)		$      (10,374)		$      (10,942)
Add: Stock-based compensation	3,992		4,765		12,067		14,465
Add: Employer payroll tax on employee stock transactions	291		320		1,074		772
Non-GAAP professional services and other gross profit	$       1,501		$       3,262		$         2,767		$         4,295
GAAP professional services and other gross margin	(16.0) %		(9.1) %		(20.3) %		(19.2) %
Non-GAAP adjustments	24.6 %		25.3 %		25.7 %		26.7 %
Non-GAAP professional services and other gross margin	8.6 %		16.2 %		5.4 %		7.5 %
Reconciliation of operating expenses:
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands)	2025		2024		2025		2024
GAAP sales and marketing	$   296,516		$   290,597		$   898,379		$   859,705
Less: Stock-based compensation	(48,018)		(49,347)		(143,184)		(154,396)
Less: Employer payroll tax on employee stock transactions	(2,356)		(1,618)		(9,258)		(5,351)
Less: Amortization of acquisition-related intangibles	(3,378)		(3,354)		(10,086)		(9,096)
Non-GAAP sales and marketing	$   242,764		$   236,278		$   735,851		$   690,862
GAAP sales and marketing as a percentage of revenue	36.2 %		38.4 %		37.7 %		39.1 %
Non-GAAP sales and marketing as a percentage of revenue	29.7 %		31.3 %		30.9 %		31.4 %
GAAP research and development	$   167,626		$   151,101		$   496,703		$   432,992
Less: Stock-based compensation	(60,806)		(53,184)		(177,102)		(150,816)
Less: Employer payroll tax on employee stock transactions	(1,918)		(1,273)		(9,599)		(5,592)
Non-GAAP research and development	$   104,902		$     96,644		$   310,002		$   276,584
GAAP research and development as a percentage of revenue	20.5 %		20.0 %		20.9 %		19.7 %
Non-GAAP research and development as a percentage of revenue	12.8 %		12.8 %		13.0 %		12.6 %
GAAP general and administrative	$     98,307		$     97,555		$   283,443		$   277,162
Less: Stock-based compensation	(32,808)		(31,070)		(91,984)		(91,239)
Less: Employer payroll tax on employee stock transactions	(728)		(489)		(3,004)		(1,774)
Less: Acquisition-related expenses	—		376		—		(4,340)
Non-GAAP general and administrative	$     64,771		$     66,372		$   188,455		$   179,809
GAAP general and administrative as a percentage of revenue	12.1 %		12.9 %		11.9 %		12.6 %
Non-GAAP general and administrative as a percentage of revenue	7.9 %		8.8 %		7.9 %		8.1 %
Reconciliation of income from operations and operating margin:
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands)	2025		2024		2025		2024
GAAP income from operations	$     85,355		$     59,030		$   210,837		$   139,459
Add: Stock-based compensation	160,642		153,228		466,776		455,552
Add: Employer payroll tax on employee stock transactions	6,182		4,274		26,489		15,450
Add: Amortization of acquisition-related intangibles	4,873		6,920		16,708		17,799
Add: Acquisition-related expenses	—		(376)		—		4,340
Add: Restructuring and other related charges	—		—		—		29,721
Non-GAAP income from operations	$   257,052		$   223,076		$   720,810		$   662,321
GAAP operating margin	10.4 %		7.8 %		8.8 %		6.3 %
Non-GAAP adjustments	21.0 %		21.8 %		21.5 %		23.8 %
Non-GAAP operating margin	31.4 %		29.6 %		30.3 %		30.1 %
Reconciliation of net income and net income per share, basic and diluted:
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands, except per share data)	2025		2024		2025		2024
GAAP net income	$      83,725		$      62,423		$    218,782		$    984,394
Add: Stock-based compensation	160,642		153,228		466,776		455,552
Add: Employer payroll tax on employee stock transactions	6,182		4,274		26,489		15,450
Add: Amortization of acquisition-related intangibles	4,873		6,920		16,708		17,799
Add: Acquisition-related expenses	—		(376)		—		4,340
Add: Restructuring and other related charges	—		—		—		29,721
Add: Income tax and other tax adjustments	(44,313)		(37,973)		(131,711)		(944,923)
Non-GAAP net income attributable to common stockholders	$    211,109		$    188,496		$    597,044		$    562,333
Numerator:
Non-GAAP net income attributable to common stockholders	$    211,109		$    188,496		$    597,044		$    562,333
Denominator:
Weighted-average common shares outstanding, basic	201,954		203,567		202,619		204,674
Effect of dilutive securities	6,115		5,139		7,986		5,081
Non-GAAP weighted-average common shares outstanding, diluted	208,069		208,706		210,605		209,755
GAAP net income per share, basic	$         0.41		$         0.31		$         1.08		$         4.81
GAAP net income per share, diluted	$         0.40		$         0.30		$         1.04		$         4.69
Non-GAAP net income per share, basic	$         1.05		$         0.93		$         2.95		$         2.75
Non-GAAP net income per share, diluted	$         1.01		$         0.90		$         2.83		$         2.68
Computation of free cash flow:
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands)	2025		2024		2025		2024
Net cash provided by operating activities	$    290,274		$    234,326		$    787,786		$    709,360
Less: Purchases of property and equipment	(27,374)		(23,613)		(79,423)		(68,646)
Non-GAAP free cash flow	$    262,900		$    210,713		$    708,363		$    640,714
Net cash used in investing activities	$     (37,748)		$     (43,698)		$     (93,125)		$   (280,585)
Net cash used in financing activities	$   (270,461)		$   (198,335)		$   (767,316)		$   (607,277)
Computation of billings:
	Three Months Ended October 31,				Nine Months Ended October 31,
(in thousands)	2025		2024		2025		2024
Revenue	$    818,350		$    754,820		$ 2,382,640		$ 2,200,487
Add: Contract liabilities and refund liability, end of period	1,479,491		1,332,828		1,479,491		1,332,828
Less: Contract liabilities and refund liability, beginning of period	(1,468,618)		(1,334,461)		(1,479,266)		(1,343,792)
Add: Contract assets and unbilled accounts receivable, beginning of period	13,824		17,461		17,825		20,189
Less: Contract assets and unbilled accounts receivable, end of period	(13,588)		(18,341)		(13,588)		(18,341)
Add: Contract assets and unbilled accounts receivable by acquisitions	—		—		—		53
Less: Contract liabilities and refund liability contributed by acquisitions	—		—		—		(5,071)
Non-GAAP billings	$    829,459		$    752,307		$ 2,387,102		$ 2,186,353

   

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SOURCE Docusign, Inc.

FAQ

What were Docusign (DOCU) Q3 fiscal 2026 total revenue and subscription revenue on Dec 4, 2025?

Total revenue was $818.4M and subscription revenue was $801.0M for Q3 fiscal 2026.

How much did Docusign (DOCU) bill in Q3 fiscal 2026 and what was the YoY change?

Billings were $829.5M, a 10% year-over-year increase.

What guidance did Docusign (DOCU) give for revenue for the quarter ending Jan 31, 2026?

The company guided $825M–$829M total revenue for the quarter ending Jan 31, 2026 (about 7% YoY at midpoint).

How did Docusign (DOCU) perform on cash generation in Q3 fiscal 2026?

Net cash from operations was $290.3M and free cash flow was $262.9M for the quarter.

What investor actions did Docusign (DOCU) take in Q3 fiscal 2026 related to buybacks?

Docusign repurchased $215.1M of common stock during the quarter.

What IAM platform milestones did Docusign (DOCU) announce in Q3 fiscal 2026?

IAM surpassed 25,000 customers and the Navigator repository contains ~150M opted-in agreements.