DocuSign (DOCU) Stock Forecast & Price Target

DocuSign reported a 9.0% year-over-year increase in total revenue, driven by an 8.9% growth in subscription revenue, signaling strong demand for its Agreement Cloud platform. Operating cash flows improved, reaching $307.9 million with a notable margin of 39.7%, demonstrating efficient financial management and operational effectiveness. Despite mixed guidance for future performance, the company's ability to exceed consensus expectations in recent revenue figures positions it favorably for continued growth in a competitive market.

Docusign's recent quarterly performance indicates stagnation, with customer additions remaining flat at 30K and a year-over-year growth rate of only 9.9%, down from 40K in the previous year. The company's outlook includes weaker margin guidance for FY26, with expected gross margins of 80.5% to 81.5% and operating margins of 27.8% to 28.8%, both slightly below market expectations, primarily due to costs associated with cloud migration and strategic investments. Additionally, Docusign faces challenges in customer growth, with a significant deceleration to 7.4% year-over-year and a reliance on its core e-signature revenue, which could falter if adoption continues to decline in a highly competitive and evolving market.