Docusign's revenue increases by 9% in the second fiscal quarter

Docusign (NASDAQ:DOCU), a prominent player in digital agreements and electronic signatures, reported its financial results for the second fiscal quarter of 2026 on September 4, 2025. The details of the report suggest that Docusign had one of its strongest quarters in recent years. Second-quarter revenues reached $800.6 million, exceeding the company's guidance of between $777 and $781 million, while billings amounted to $818 million, compared to the $757-767 million forecasted. The adjusted earnings per share were $0.92, slightly down from $0.97 the previous year.

Overall, the performance of this quarter reflected a renewed momentum in sales, a strong reception from customers, and the initial results of recent product innovations and changes in marketing strategy.

About Docusign: Its Activity and Focus

Docusign makes it easy to sign documents electronically, manage contracts digitally, and automate workflows for organizations of all sizes. Its main offerings include the eSignature platform, a widely used tool for signing documents electronically, along with the contract lifecycle management software (CLM) that allows clients to create, negotiate, and store agreements in a secure cloud environment. Docusign also offers Intelligent Agreement Management (IAM), a new generation of software that uses artificial intelligence to streamline and analyze agreements at scale.

Recently, the company has focused its strategy on accelerating product innovation (especially the AI features in IAM and CLM), perfecting its omnichannel sales approach, and improving operational efficiency through technological investments and changes in marketing. Key factors for business success include expanding subscription-based recurring revenue, ensuring ongoing adoption of its new platforms, and maintaining efficiency in the delivery and support of these digital solutions.

Quarterly Review: Developments and Key Factors

Revenue increased by 9% year-over-year in the second quarter. Billing, an indicator of future revenue, grew by 13%. Management attributes these advances to a combination of product launches, especially in AI-driven smart deal management, and improvements in the execution of its marketing strategy, when complexity in renewal times and internal changes in sales temporarily affected revenue growth in the first quarter of fiscal year 2026.

Subscription revenue, which now accounts for 98% of total revenue, increased by 9% year-over-year according to generally accepted accounting principles (GAAP). On the other hand, revenue from professional services and others fell by 13% to $16.2 million. This segment continues to struggle with negative margins, Docusign's non-GAAP gross margin decreased by 0.2 percentage points to 82.0%, reflecting some ongoing challenges arising from investments in cloud migration.

Docusign highlighted several product launches and features during the period. Its AI-based agreement management suite added new capabilities, such as tools that automatically detect the type of contract, generate templates, and extract key information at scale through “Navigator” ( an AI-powered agreement insights tool ). Features such as identity verification with CLEAR ( a digital identity verification platform ) and new workflow automations with Master templates were introduced as ways to enhance efficiency and customer compliance. Management also noted third-party recognition for these advancements, including being named a leader in the IDC MarketScape 2025 for CLM applications on the buy side with AI.

Regarding marketing, changes such as the segmentation of the sales force and the expansion of self-service channels and partner-assisted channels seem to be yielding results. Increased efficiency in sales and marketing, combined with a higher free cash flow (non GAAP), which increased by 10.0% year-over-year in the second quarter of fiscal year 2026, underscores the improvement in operational execution. The company continues to repurchase shares at a steady pace, with $201.5 million in the second quarter of fiscal year 2026.

Looking Ahead: Forecasts and Important Signals

For the third quarter of fiscal year 2026, Docusign forecasts revenues between 804 and 808 million dollars. This represents a year-over-year increase of 7% at the midpoint for the three months ending October 31, 2025. The billing forecast is 785 to 795 million dollars in the third quarter of fiscal year 2026, 5% higher than a year ago. For fiscal year 2026, the total revenue forecast (GAAP) has been raised to between 3.189 and 3.201 million dollars. This is approximately 38 million dollars above the midpoint of its previous forecast for the fiscal year ending January 31, 2026. The company anticipates continued margin resilience, with a non-GAAP operating margin forecast between 28.6% and 29.6% for fiscal year 2026. In the coming quarters, investors are likely to focus on the adoption of new product features in an increasingly AI-intensive deal landscape.