E-signature and cloud-based document company DocuSign (NASDAQ: DOCU) reported its second-quarter results for its fiscal 2019 after the market closed on Wednesday. After the company went public this spring, this report marked DocuSign's second quarterly update as a publicly traded company.
The quarter was solid, featuring more strong revenue growth, a non-GAAP profit, and improving free cash flow. Here's an overview of the results.
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DocuSign's second-quarter results: The raw numbers
- Revenue of $167 million was above management's forecast for $157 million to $160 million
- DocuSign's 33% year-over-year revenue growth in Q2 was slower than its 37% growth in its prior quarter
- Non-GAAP gross margin was 81%, up from 79% in the year-ago period.
- DocuSign's net loss widened from a loss of $12 million in the year-ago quarter to a loss of $36.7 million.
- On a non-GAAP basis, DocuSign swung from a loss of $1.2 million in the year-ago quarter to a profit of $5.2 million.
- Billings increased 32% year over year to $172.2 million.
- Free cash flow during the quarter was $18.4 million, up from $7.8 million in the year-ago period.
What management had to say
DocuSign CEO Dan Springer said during the company's second-quarter earnings release that the quarter was strong, citing a 35% year-over-year increase in subscription revenue as a key catalyst for the quarter. Springer also said DocuSign added more than 25,000 customers during the period, bringing total customers to nearly 430,000.
Springer also commented on the company's Sept. 4 closing of its acquisition of SpringCM -- a cloud-based document and contract management company. "With SpringCM, we have a broader set of products to sell, additional technologies to commercialize, and a team whose experience complements ours almost perfectly," Springer said.
With such a strong quarter behind it, DocuSign lifted its full-year outlook for revenue and billings. Management now expects full-year fiscal 2019 revenue to be between $683 million an $688 million. Previously, DocuSign forecast full-year revenue between $652 million and $658 million. For billings in fiscal 2019, management expects $732 million to $752 million -- up from a previous forecast for $680 million to $700 million.
For DocuSign's third quarter of fiscal 2019, management said it expects revenue to be between $172 million and $175 million, implying a sequential jump from DocuSign's $167 million of revenue in Q2.
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