By Mackenzie Tatananni

Docusign stock was rising in premarket trading Friday after the software company reported third-quarter earnings that beat analysts' expectations.

Docusign reported adjusted earnings per share of 90 cents from revenue of $754.8 million, surpassing Wall Street's estimate of 87 cents on revenue of $745.3. Subscription revenue rose 8% from a year earlier, while billings increased 9%.

Shares of the California-based e-signature company climbed 13% to $94.19.

Docusign also raised its fiscal-year revenue outlook to $2.96 billion from a previous forecast of between $2.94 billion and $2.95 billion.

"We continued to drive improvement in our core business with strong revenue growth and operating profit," CEO Allan Thygesen said.

Needham analysts pointed to the increase in billings, writing that it "stole the show."

"Docusign posted a surprisingly strong quarter with revenue and EPS above the Street while solidly raising its full year guidance," the analysts continued. The firm maintained a Hold rating for the stock.

William Blair analysts attributed much of the company's momentum to its Intelligent Agreement Management platform, which launched in April and continuously receives updates. Last month, the company unveiled Docusign for Developers, a suite of tools allowing businesses to build on the IAM platform.

"Moving forward, we believe IAM will help DocuSign drive greater adoption of new features, provide a meaningful upsell opportunity, and ultimately drive stickier customer relationships," the analysts wrote. William Blair rates the stock at Market Perform.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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December 06, 2024 08:16 ET (13:16 GMT)

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