DOCU - Earnings call transcript Q1 2022

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Operator

Good afternoon, ladies and gentlemen. Thank you for joining DocuSign’s First Quarter Fiscal 2022 Earnings Conference Call.

As a reminder, this call is being recorded and will be available for replay from the Investor Relations section of the website following the call. [Operator Instructions] I will now pass the call over to Annie Leschin, Head of Investor Relations. Please go ahead.

Annie Leschin

operator. you, Thank everyone. Good afternoon, DocuSign’s first earnings to fiscal quarter call. conference Welcome XXXX

quarter DocuSign’s today, press Springer; first Relations earlier website, call slides. our the our posted CEO, and release was is today we our along The On Investor Gaylor. have Dan on issued Cynthia and announcing quarterly with results CFO,

We are remarks prepared site this planning on to post quarter. beginning next

Evercore’s to to TMT participate Bank XXXX started, Global get and Conference else everyone XX. Services we events. X, remind These on on Baird’s & I’d upcoming Conference like includes, in June of virtually Global we on Before a Tech XXXX few plan June June Tech that America’s Consumer, Conference X,

events we’ll As come make up, announcements. other additional

we obligation assumptions our no future on as to law, information. best subject on our expectations or are filings actual to assumptions of date, by they expectations Any unknown on let expectations pandemic believe may this based our are risks SEC to at together therefore We related effects business, are in new the today’s with to and our call are are based subsiding, and particular, Now, are everyone subject our on statements remind the forward-looking potential pandemic me risk factors and our update reasonable, and and including of be assume forward-looking. that In forward-looking content that events to these our the statements results effects call. this time some read these known Please our uncertainties regarding but the or to light statements except required to COVID-XX change. estimates the of statements in different. and performance cause of the of materially with the

financial from notes, discount stock amortization financial and on acquisition-related issuance During costs as acquired applicable, measures. we’ll exclude amortization compensation, items. employer non-GAAP tax other our transactions, and assets, of and this measures debt employee payroll special stock-based Non-GAAP of present GAAP call, intangible expenses

information regarding you we all not In addition, when isolation encourage provide billings. and flows to intended non-GAAP-weighted We non-GAAP consider or from analyzing are considered our or for, cash These free results. GAAP be to our in to measures performance. count and share a substitute superior average measures

For to quantitative investor.docusign.com. the directly at today’s information can non-GAAP our regarding please most figures, GAAP the on financial refer be release, comparable press and of information, earnings measures those reconciliation a found which website

Dan. Now, I’d like to to over turn call Dan? the

Dan Springer

fiscal afternoon, welcome our Thanks, everyone. XXXX. call Annie. And to for Good quarter first earnings

And my a have key I’d today. focus to four like comments lot to cover We on areas.

this businesses usually processes, go emerge. businesses only another as agreement once they economy of many trend their Our to key I the the strong in our the get We simply XXXX now see Put has to has share our more and other lending as has of need and and a on DocuSign observations investments and strategic overall. into that as services But many indispensable result, But financials, we evolving, want around an of some results, world. an business accelerate this into transformed education, began small QX the Since customer to government, urgent before year healthcare, journey, part continues fiscal organizations’ made landscape, markets processes. transform international back. people technology way we insight pandemic the how helped don’t access a we DocuSign business start breadth finally, accelerate priority, believe quarter. in to the anywhere become will

few a were weeks excited fact, millionth one DocuSign’s to In platform. ago, we welcome customer the just to

saw year growth strong a a all DocuSign. at and start We great has for the Now to scale. balanced profitability fronts, digital this in move on manifested performance itself to delivering

From our of of exceptional over with of for results outpaced our engagement million grew and home. a growth, growth we expansion XXX%. are am continued XX% any particularly Non-GAAP cases. milestone net working revenue all revenue strong top-line the point customer operating despite the reflect year-over-year margin record our advantage base investments. across are X,XXX workforce seeing during the execute to $XXX strong at all-time in Our as customers that ability from team reached demand XX% I high use dollar vast these retention quarter. high DocuSign’s $XXX the still industries proud And from the million majority reached to quarter. across International existing our

we As is eSignature for companies. both said, consistently, DocuSign on-ramp to

customers volumes and increasing record expand exception cases no significant. with existing was as saw quarter at use we rates and This adopt envelope new and

capture, me structures reporting, create eSignature a service new benefit hundreds and Insight delivery and monitor, helped you future and and its PowerForm solution new DocuSign the for an provider the leverage examples. just provided give saved to of This of needed on report for large processing team workers. Analytics few Let streamlined We process. A growth. to management created accurate an entirely it and manual extensible efficient hours and

way as to restaurant and worked with We reopen. agreement industry needed generation automate to them their productivity. their to and One turnaround sales and began a our customers of increase improve service streamline time signing processes

defined agreement was templates million one over domestic, complete paper to this workflows several multinational Africa. of media of as production contract. archive impact. largest response number across customers a and ago, be U.S. increase grow business their API, business biggest customers North huge month They And the validation a like XX% and new example. paper for reduce Importantly, took to outside And now digitally qualified company to driver as total than a our the in sense Today, the of and an started Sub-Saharan international as customers process, of This in us industry the the users has are of regulated three XXX,XXX This way our Europe internal pieces international the deployed and it for a continues American decreased two and standard, processes external and takes for the growing dramatically were growth just the of their countries eSignatures grocery our way. one eSignature will similar where pandemic, the just only quickly environmental future QX circulation, required. of contracting sheets a now time using our well. out expanding part that contributed years the business their more to solution leverage revenue. In they can other DocuSign weeks customer from that days. verification, to but leading manufacturing printing TAM. with to telecom this advanced, our units expansion now technology. and of automatic looking pharmaceutical an the in transform and Using much Take not part looks a

a new Our users XX% teams completed users, more XXX% they increase onboard And Amid dropped weeks. work faster. them in from together themselves. sent envelopes the the for XXX% results new three speak and and to time

also in early we’re of April, virtual traction doors strategic driving In we’re there we customers late online. our LATAM. variety excited to to Speaking a We initiatives in service by And officially ability increase Spanish the internationally. are Mexico seeing opened our

now products transaction. is now property focus just witness grounded further electronically makes began executed the value volume, privacy, DocuSign This high electronic DocuSign our their witnesses ever Registry enabling when and upping the we’re agreement. class like country’s first that products high regional accepting an Land security, on increasingly with new eWitness data can important signatures reliability, product only in UK. enhancement done availability, take as deed Land of agreements they for we electronically. on are that compliance, UK a one are the identify are trust, And This also be product possible step it in regulatory Registration in submitted can We Authority offering [ph]. but signing paper. high the to

committed whole fiscal of for as and important anywhere to which year the our vision ahead looking Cloud, highlight that Agreement to of remain both want you for So, to Either of our platform, platform, the a are software beyond, key in economy. product, today. the for as company couple we and and investments DocuSign pillar I the XXXX the some rest

also host compliments helps a to solutions, the action, of idea, and Clause’s connect has smart a close and of acquisition running companies Clause’s innovative, and the DocuSign our contracts built checks, insurance, agreement developing the how and experience systems mark technology The for team cloud technology and sending drive ours, like want Clause. is to has to of the partner compliance their enables way sending our status a from the and healthcare these first platform been we agreement and architect agreement Clause future. financial customer code, of many services, The notification, run specific third-party the updates, computer as

Dan, to excited the DocuSign. really We’re welcome team Peter, whole and to

team of at the highlight DocuSign. continued our is leadership Second, expansion executive

infrastructure we of That’s as it’s thrilled Iyer, grow technology why that we vital that the welcome CIO. scale, supports that evolution. right and important As oversee drive in the leaders the [indiscernible]. our we processes I’m our in Equally evolving need today rapidly to place have and optimize to Shanthi new and systems,

Salesforce, QX, our former we’re all Data Chief expanding those efforts former and ensure continue bench local international and Dan Also, thrilled will we’re areas our that to to we her lead DocuSign Bognar, the regional regional the world-class is and we In have help in As board. at on our leadership APJ. of in too. Officer appointed regional Cisco, growth Shanthi

over help Before year our around Q&A. it talking I reiterate all now the optimistic customers value I over to to you And to during about forward and transformation our to agreement I with am offer and Cynthia, look of the process you ahead. hand is our world. The doing everything partner I to Cynthia. team the our want that we

Cynthia Gaylor

afternoon, followed fiscal execution. in good with driven impressive XXXX and to XXXX fiscal an Dan, up Thanks We start exceptional an by everyone. year strong

in This another quarter. grew million remained growth installed Customer for healthy the our the to to revenue a XXX,XXX million QX, strength model grew XX% to In XX,XXX in renewals total climbing customers in as demand XX% and our record than This of early digitize our million. over bringing international increase We customers of Billings XX% $XXX time. to threshold Elevated to eSignature annual expansions top-line brings of EMEA customer than customers trail reach demand year-over-year an levels aided this strength leverage continue crossed and in margin outside In to revenue an We adding the flow customer increase compared to trend of customers the our winds $X.X to particular and quarter, of second a international with the as greater notable revenue million. year-over-year We drive of Total operating million XX% year-over-year a quarter. grow XXX,XXX, at customers new $XXX customers benefited subscription worldwide growth secular as QX, record more our in first customers with billion. to existing customer above the in significant year-over-year XX% in increased ago. led XX% for total, business year-over-year U.S. demonstrated saw revenue QX. continue an the offerings spend XX,XXX of direct investments year-over-year. by the to quarter, Continued first $XXX by XX businesses. also to with direct XX% traction. gain includes total $XXX $XXX,XXX consumption the XXX exceptional cash base with from end base of our year quarter saw growth addition the their for scale. total $XXX customers

non-GAAP led Continued ago. for the gross was for retention QX, year over the a margin net past XX% year with expansions gross XX% with to compared XXX% ago, seen pandemic subscription we’ve while XX% year a margin strong economics the rate highlighting since of compared upsells quarter Total dollar expansion with the XX% began. and a

on our $XX Non-GAAP at year. demonstrated first As of or for reached the top-line, the XX% leverage. operating million last range or margin, model first outperformance saw million compared a with our result X% we quarter of in operating time the target $XX

million for of We R&D, quarter plan X,XXX QX and million year. ended innings flow prior over also the compared the quarter year. the We of in This in XX% We $XXX quarter year. $XXX capacity, net Free continue Operating early or to a an the million marketing, with equivalents, with top-line our or was compares for large margin Cash collections. compared restricted at due performance the million investing of the opportunity. in and the cash flow $XX cash, XX% $XX long-term to to We income flow cash last XX% or sales XX% million growth, are outperformed. a first strong $XX $XX investments. with with in exited or scaling million particularly cash same in operations. in Non-GAAP margin million of $XXX in in XX% year market and with came QX employees quarter cash increase still ago. last

let Now, turn me to guidance.

For subscription to $XXX XX% anticipate year-over-year. Of to XXXX revenue to fiscal we year XX% of XX% billion revenue XX% of or million year-over-year. or XXXX year-over-year growth billion or growth in $X.XXX $XXX fiscal $X.XXX in growth $XXX this, or growth we total XX% to to fiscal and for to $XXX QX QX billion for the XXXX expect and of second of quarter million and million of of million $X.XXX year-over-year, to billion XX% XX% $X.XXX

year-over-year QX billion billion growth XXXX growth or $XXX XX% to million and For fiscal XX% of XX% for billings, $X.XXX year-over-year. $XXX million we XX% $X.XXX to in to expect or to

gross be for both to and to XX% XXXX. expect XX% fiscal We margin non-GAAP QX

to XX% We expect fiscal to XX% QX non-GAAP operating margin be and for XXXX.

see to in expect de minimis We amount income. a of other interest

We $XX to $XX also a for approximately of fiscal expect XXXX. million million provision tax

shares $XXX we the More closing, to and are enabling our of for are incredibly million pleased XXXX. outstanding $XXX We both around with businesses diluted weighted In fully performance. we QX expect million QX ever, than world. fiscal average

and economy joining remain DocuSign grow, to the develop today. our part evolution. As customers’ Thanks an continues digital integral anywhere of us for will

We it Q&A. call for up open will now Operator? the

Operator

Thank Instructions] you. Thank [Operator you.

with JPMorgan. your proceed comes from with question. Our first question Auty Sterling Please

Sterling Auty

Thanks. Yes.

of some leadership Europe on U.S. the helping in are in you’ve you in the apply the what growth to that able takeaways learned you been front, rollout the your international under So, there? accelerate that Mike’s that’s

Dan Springer

growth you back the if We years dimensions, talked Sterling, been the businesses they quite looked of sorts business, scale, to size amazingly alike, the that few when all have bit about fact rates a the go international a the similar. of U.S.

the of internationally adoption success think the tees the focus you think as quality before, when helping for we the adoption. we’ve core is on piece. model, I things right our point really to good in is a the a up customer at done And And land really really it’s success that I first organization would as sure we’ve get talked and SaaS model. drives about a foundation expand job

versus really we are install are that the our So, way think I sales we those base to would say sale. between those just is have two we’ve that that the that driven selling our We talked expansion about resources second tremendous that, piece those success. allocated pieces same to doing what I are NewCo followed model. And

Now, if in don’t growth, for into U.S. us recall you XXs talk having I about that the those the the ever numbers

master taught some I goes that ways has internationally on. focus be would so we’ve I in So, we themes guess would those the the analogy standpoint. exceeded that so from ourselves student exceeded, that But that over the well

Sterling Auty

bit Dan, rollout I during the Yes, the hear a little of exactly. give any sense. Can an update on up there? just broke the solution. us prepared update follow-up, your didn’t one me makes on of quick kind That notary call you And remarks,

Dan Springer

yes. Absolutely,

notary, we’re We’re first we’ve and And first member and excited going the thrilled of our now financial really really focused business customers, And our that sort is they their and institutions, occur. been the that’s we’ve released had use rollout to notary, that because that after that’s what bigger notaries, see opportunity that et a their we’re which we’re cetera, that’s own to that. in first. transactions have able embedded primarily existing piece on party large

rest this the where availability And that’s So the that notary. sort their the need And notarize individual, someone working we then that institution is comes, them be over just that very notary neither of or two on an second piece third-party year but early, we’ll is the market. of for transaction, have people third-party that now model has would large own. to a have a of

we’re progress the pleased. really that’s So

Sterling Auty

you. Thank Got it.

Operator

you. Thank

question UBS. with next question. Our Please from Keirstead comes with proceed your Karl

Karl Keirstead

for ask you seasonality Cynthia, XXXX. love maybe just one I the this fiscal you, you. billings’ to Thank about this

of which early forward the by first full as than then on QX. the mention consumption, way XQ other expansions guide a But bit sounds renewals is blush result super you strong, into a at little pull did your QX. year the raised a elevated like and hand, more You

throughout you year. So, signaling it sounds strength like the are

So, just I’m wondering as you comment seasonality if on it a could the and result changed of whether performance. QX

Cynthia Gaylor

we they the for did mainly around a haven’t in seen big that shift Sure. using Yes, Thanks We customer are on you seasonality. seasonality, how I that so the think products. due than stronger expected consumption see mentioned, and question. to QX things a

So, the well looking that that product at, we customers were cases the we’re metrics for. as our use by as using both really encouraged consumption are

that’s but the And guide. forward reflected the the also quarter, for so in both performance

Karl Keirstead

Got it.

these by on Congrats great. the Okay, numbers way.

Dan Springer

you. Thank

Operator

you. Thank

question comes Zukin from Wolfe with with proceed next Our Alex Please Research. your question.

Alex Zukin

forget people one COVID seeing for Dan, start like model. Hey are I And going or last previous rates, start the people year it to are thanks a that a decelerating that. stock, just are you you you which above these added if you capacity-based net I with cohorts guys, are as fears, have therefore, seeing grow dollar-based But you expansion. that historically on is of expanding it’s the DocuSign that some comps. seems had think, these think at tough you

better very the this on You’re through and side. to positioned other positioned right be well actually, even grow

your cohorts quarter kind growth through those saw and of So, just rate the talk this how forward? position around that, what of you going

Dan Springer

how don’t missing are it. point, your know to people Alex, Yes, I

it you point, appreciate every I I which that make the about see write You way. report by in

nailed to think more listen your people you But hopefully start insight. to So it. will I

that’s we’re seeing. exactly think what I

so see why Cynthia customer from to you we for why the to from a think And such the not we underlying last really the demand what a phenomenon strong talked achieved that standpoint of call. talk because had revenue question high. I and standpoint, is key rate see net was able the billing you previously the retention seen customers. strong the growth It’s at that that guide rates it’s to is COVID, is so the strong at a it have we about about for seeing We’re of Karl, beginning

with to digital phenomenon an that once of cloud see So, the back. their benefits grow the business around the the opportunity don’t from they particularly, people, go agreement they having transformation, us,

to look they expand. additional fact, In for opportunities

talk the past. some it pull of it QX an really about we amounts have like don’t you Paul. And so, that increasing in I as and back goes at I demand, forward about the think takes Peter, look forward pull from it’s don’t We just it as was fixed talked and and paid

we’re the still days, in very strong business, ocean from our So, TAM, pulling is which we eSignature it’s of early but even a forward just with the that so very, penetration are low, customer demand. continued large

at we So that’s how look it.

fairly it’s think straightforward. I

Alex Zukin

And the new we awesome. any in again to new range XXX%. normal, just maybe to of call Cynthia, ticked it? but or be hesitant to by one, And for a one it takes starting know you mostly any about is That’s think then how the is or I for puts that up have driven CLM adoption, been dollar-based case? figure, guys use on a still and net past core quick expansion a that should

Cynthia Gaylor

opportunity but Remember there, around I case, still use say contribution agreement excited about the it’s perspective. the mainly small the core from very a it’s so we’re cloud Yes, right. very dollar would

expanding the continued product the not economics the many call cohort the expand just they then existing the of of but over that of in the was cohorts their customer lot net around months, just the expansion kind the first of last around really economics who strengthened usage XX the have over to that time. number question range. And how on right, the retention part is and cohort the came ways, retention what of and I of a are base So,

historically. the we maintain been would to as at last which or XXX% this end expect, high throughout historical XXX% range, said the quarter we So, to above year had

kind of going we’re but expect be not going retain guiding to through would metric we to year, net to high or specifically. the maintain retention So, that rates to

Alex Zukin

guys a on Congrats Perfect. great quarter.

Cynthia Gaylor

you. Thank

Operator

Thank you.

your Our next with Citi. proceed Please question Radke comes with from question. Tyler

Tyler Radke

the specifically, get behind taking overseas. most for the question. you’re customers are just thanks starting you evolution high pipeline? that of things are you What And see the curious transactions, I’m Hey, terms the in do level U.S. impacts are my as back just that pursuing to COVID to larger in strategic find shortly more looking here seeing a maybe now and them. normal at of at transactions hopefully of

Just you Thank seeing evolves? curious pipeline how you. are the

Dan Springer

Yes, I’d of say tale of it’s sort a Tyler. products two

versus don’t about that frankly, think seen the different. CLM the think change. COVID, you think quite Cloud, Agreement right. you the primarily they during we’ve the signature the of the of first business were if If we rest And core of about nature different, to didn’t fast, anything fundamentally just I part see no transactions signature

quarters And acceleration again rounding ways, will think, move new I the and normal into whatever starting saw that Cynthia those be. so, many to occur. kind we as pointed in of out, as And we’re

rate our about same We’re incremental transactions how land think here. are occurring still the it. about customer across I course, And wouldn’t happen still are the maybe expansions With of That’s increments, was in they size. different, of seeing the dramatically businesses say each just it of same think size CLM, them of I think the more demand. of I we I time the right. at But bigger, that accelerated

partners. integrator strategic it working starting by the build really the way more nice what complex remotely. focus more people whether ROI. to sort People down, during said more would order pandemic. bigger. do I Those is size slowed usually on deal are transactions. enabling wonderful work little those, with of definition, require and They And substantive And SI the are, one we this of fast services, is to Those a our right. a to pandemic, density I of demand again need think was the and statement work systems we So, some really before was and say right

Now, we to see those come back. starting

And as more pipeline to in actually so, there. aggressively we see the starting build, did we starting QX, started

coming I So separate over least But back. will between that would sites. we don’t think look at larger need And deal they two to those demonstrably those them signature be sizes at are see. in cross you

Tyler Radke

follow-up a Cynthia. just And Thanks. for quick

here margins of on driving were about a really the operating strong saw curious or in other the the quarter. how expense some was year? things, front bit you the you of upside, if So, related of kind Obviously, kind one-offs quite you. of hiring thinking revenue the the pace hiring just there but any of strength in throughout rest just are Thank

Cynthia Gaylor

invest Yes, quickly to the liked just difficult we quarter. It’s pretty In operating growth margin very was down and would ways be to do at in XX%. bring that have to able that into phenomenal some more number.

So, at year invest embedded for looking to we’re guide in the continue as well. ways growth. through to really that’s the And

pretty outperformance the nothing would the but than us. top-line, margin for other I one-off which we to growth quarter, particular to opportunity drops in look say continued invest and the there was of large immediately of the in ahead will aggressively So, operating

Tyler Radke

Thanks.

Operator

Thank you.

comes Morgan proceed your question. question next Zlotsky Our from with Please Stanley. with Stan

Stan Zlotsky

up agreement wanted cloud mentioned is broader the thinking material [indiscernible] and numbers bit Hey could guys, a for How as follow-up guys retention right. that you this It’s which to my drive question. taking really thank small you guys afternoon. that now even net something on you it’s material just the recording revenue to good enough ticking when about as in big are really far not that seeing become the And SpringCM, enough maybe still driving now? you nicely. I little ago, and growth are as

Cynthia Gaylor

talking the Agreement opportunities. just it’s there’s in about Dan we’re of pretty say, early Cloud. would And the innings, ton was but I So, a also market, across nascent as a greenfield

in heavily in also around our just So, the product innovation. that but we’re and go-to-market strategy on customer success, investing both

piece, the few to be kind contributor. a few we expect results last by given have on driven for the it’s really scale So, growth a it’s if and when of years about that I while quarters, a to the of you be quickly growing meaningful they kind before posted just are Agreement take think to a core would a eSignature. And the even meaningful really And rate top-line it’s it primarily Cloud, perspective. the within contributor from going

Stan Zlotsky

it. Got we to understand want you not the would to for it. you not quarters? similar it seeing follow-up range that is which – about consistency normally just guys you What number range, x it you’re in on what take also, And to for revenue of really earlier, on to is start up the moving I fashion, are intention. I net talk but out question for you Got a Alex’s plus moving this yet up that that of XXX-ish move will to have think as range? milestone about,

Cynthia Gaylor

quarters, these historical they we they how and of more trends. and are It’s the are a kind then consuming metric consumption of kind new and And how and that the talked the few at we about watch customers looking existing very given last closely, just expanding as cohorts cohorts.

expect I for said, for top a above closely. year as the end the net XXX. the which it of historical would wouldn’t So, we’re watching guiding that retention we was I remain range, range remainder but the to anticipate to

Just seeing, end given range. high the we we’re be consumption expect trends the above of would to it that

Stan Zlotsky

you Thank it. so Got much.

Operator

Thank you.

your proceed question with Our Needham Scott from Please & comes Berg Company. question. with next

Scott Berg

everyone thanks a fantastic two. questions. taking guess I for my congrats on Hi, quarter. I have And

standpoint, obviously well-known? not you a maybe for, in new I know of you’ve know if probably, like is first think, – on I’ll brought mean, from one as the based new new? has it obviously businesses rush over what e-signature seen that is business call we cases use activity But somewhere back pandemic. you just as I an types and look we is you or year last didn’t a seeing that The all generic into any

Dan Springer

anything were banks. little supporting there’s that you are a right. built substantial. cottage There things loans, new, industry think small that think got don’t PPP a There’s I the couple of in Yes, the like, about

that’s But that So, by small exist would since that new. really what definition, we was didn’t piece do. of before

company have to at about, industry got I hit we customers. We’ve actually this think about a customer. it way We’ve there. haven’t started I millionth because that that and And to there’s lot serve way think every we to just out every the areas as one coverage company that’s breadth. internal that. big Silicon customers, it we look of just than a journey. we talk the companies cases. you use sometimes say, lot and operation particular them other the has mapped every of and of we right. do a our much been have we we’ve office I think Valley has where the kind few believe potentially I front don’t And think way customers. say, industries of don’t sort of But business able should I that the DocuSign. use you’ve guess everyone find a pretty look has back-office that, employees an not at about to And But sort got eventually

feels expansion But into new that sure. I else it that from and anywhere to going a for we sort a are thing vertical we standpoint, so, And there haven’t we’re to phenomenon a COVID, or the everywhere that really standpoint open change There’s at of up anything just be anything think, or everywhere new international economy. And with as been seen from going look areas. I geographies, in introduce hasn’t fundamentally new forward.

Cynthia Gaylor

business in we the add There cases would this verticals, kind and use PPP of whether one on, strengths have example And industries COVID-specific our so it’s different and that again, seen throughout last the into new not be just loans. it’s that A that diversified been we sizes. one verticals seen to or use customer cases, year and across that’s of is also few Both saw there’s thing spot quite verticals markets. I hasn’t year, it’s would other that we’ve a good of translate some the year and loans. of

be of cases. of other turning Some into forgiveness we’ll FinTech loan, that used sort or

also new seen as off seeing example. an have some we into we’re of so, And backs consumption that, that the cases use of but

Scott Berg

very and used there are cycles, good more a ago, versus and to level customer your even the recent what very it. year quarter, from anniversary you was metrics compared this Got customers they maybe as you. seeing or the that’s most speed cycles And helpful. how to elevated up use a today to I seeing, pre-pandemic process are perspective, show year rush normalized and level, sign product, today ago? still but you’re it are then follow-up little? brief was Thank your But sales a sales the obviously a we guess a through still Obviously,

Dan Springer

Yes, it’s actually something funny.

pricing a And give and able every about and the of just when time team like much has about has that in with like We that haven’t this call earnings talking get spent each Before we of as tenor greatest. the but I the been sort we people do pretty for change you, been and way, talking it quarter you lot since pricing the Cynthia we’re public, to there. we in latest market. the good with boring questions so seen went a

the on shortened were height of cycle saw the some people the especially times where terms were deal In side. pandemic at we who there us up, the NewCo calling of time, cycle definitely

have didn’t we a a people, relationship previous and hurry. really in So, were they

way. of on we that of deployed well be to that go implementation quarter, business base say you might’ve the amount dramatic have that time quick they cycle in coming definitely play of normal. see obviously versus was as urgency sense use were is say didn’t very because in new have was reduce I’d existing we there. portion any time. new NewCo of from to that some you that it to a So, probably And from the a relatively reverted for time, And back revenue At more our this cases, wouldn’t requirements change our significant don’t sort I the in had. that as small. remember, don’t that of given kind NSA some cycle DocuSign customers out and companies that, point comes contracting

but significant, that to from there, think reverted it’s it would wouldn’t before say has a it been what cycle have there’s time. I So, something I

Scott Berg

Congrats. again. And thanks

Operator

you. Thank

Jaluria Rishi with proceed question Our RBC. your next with from question. Please comes

Rishi Jaluria

so that Cynthia, are lot surprised I Hey, you post-pandemic But of us a this you pleasantly has give what of go the customer continuing us impressive something on question is I self-serve customers. Because the lot spite it see channels function to a certain a future. urgency Dan, like, the could a of to record, and before, or into got much even down little quarter. the mobile head to of wanted a taking to that of Annie is And side, us thanks really bit Maybe a for you’re in that, large a of think maybe especially it record that customer mobile adds. questions. died investments the adds previous on sense we had a back as hit since would looks the that’s on my follow-up driving motion fact assume then in I’ve making else? a

Dan Springer

hit some dimension, you strength. think we’re on as pleased that perhaps said it I you Yes, Yes, obviously really by unexpected that there strength was well.

that that allowed we On that the we’ve reach driven things million this team. that a primarily there’s to by and hitting set goal web several and mobile grow, think, side, us that’s I customers two done years and well, ago,

that’s our number exists. So largest where of the customers

The first at better we’re thing I our better and advertising. think, getting is, online

And I that’s I as our long-term that of think to part built a key think huge a that. discipline been we driving success.

software. process. flow. it most an and our They is, ad they And trial customer, digital they’ve overall make process become that We continuing a easier through them a that them online common and after to put do innovate we to thing which hit the the on through, easier digital by see Second our and around quality take experience that people way. of come generally we’re for a trial

is work that but One starting is part ton ad, that. people XX look have better I last add just what’s really lot off in become thing of think and net pay effort of a for that net to out we We of at mobile at the direct I’ll a team. customers. is to some can that their driven understand And made be important shout of web has that upgrade, that, the think it’s we still last out months I there. of

actually successful, business. their put them. their them and We some take customers our into almost we we most most them of take all direct successful So, of

grow a advanced and with that And what the use take out faster of so from even our churn have to and churn fact we on businesses more group has up fulsome make of we more that’s that and rate replenish them to call direct constantly expand them the functionality. platform and web into to and positive We mobile churn.

And you so, think out, standpoint that glad it for us. I from far that do has group, that pointed been really

Rishi Jaluria

and you ads XXX,XXX to really it, Got impressive quarter helpful. as it Cloud that you again, record just this usage see driving a what’s that’s expand at And customers or are on some Thanks. to of it Can customer level? actually direct really this color that going entire existing then hit is just give that the landing new generally well. the Agreement logos

Dan Springer

Yes.

and expand trying just there, way had to not business. the vast go fantastic but model success, out some both small, of we’ve customer that the never to is really As our giant growth that don’t customer start that for as believe business build is are doing success the we up and Cloud value, our to orientation, and and because that, to the the are start Agreement grow the tremendous case plans model, opposed long-term really complex. fits use and land It’s prior someone deliver vast, of not find customers, really XXX,XXX get the out to go I new. find net the ROI, we’re cases, best that’s great think trying out, majority

other is terms XXX. definitely net When case. you retention through. with and a grew, in see means bunch high that rate, the I mean, there, correlated it the it’s think Cynthia the key them at of now that of walking that’s they’re XXX, strength So highly were a the And really I companies metrics that

things. puts So, might there. go takes land be continued a that quarters back accounts some are just It’s adding number a there when, has know We way there’s the over individual that not and for any times particular the is the look and because they and surprise volatility. and of step it any expand

to one-time time Sometimes the someone one-time XXX the use does quarter. add and might then case had, over in below a do pop-down that pop-up might’ve next that they they

will I time that over continue we customer we quarter. see important particularly. reasons at to the think keep look you’re it’s to But we while to So, same number over time think as to going any do delivering one opposed that scale that fantastic see success, for

Rishi Jaluria

so Thank All right. you much. Wonderful.

Operator

Thank you.

question. Our Please Materne from comes next with your Evercore proceed question with Kirk ISI.

Kirk Materne

TAM quarter. are get a tipping think to making about about be regions are just certain there sort growth terms would trying your certain all. of in to your All you sense I you circle in the might thinking faster Dan, of hit you right. the of Thanks. thinking or hurdles rate is just to that bets it’s back than on, where a you for and adoption you say think in sort then And the it, this to the regions? Are that about of putting Thanks U.S. I I’m investments are that where others? you’re on then global And anything any echo huge and Obviously, want very as and opportunity, for in I’ll technological much. more international. of a given kind placing under there about congrats investments how certain of how sort markets sort get guys regulatory a guess where there your guys something you you to are is of bigger? just clear in you perhaps a bets or point places? And to governor are on markets sort need

Dan Springer

Yes, absolutely.

So, you. couple of for thoughts

at countries, of the legal we we deal mean, frameworks, important a we are really concept differences technological I There lot the but the of versus level, of is, talk would with there. point much the these investments civil that first I the to civil to. that are pretty about The I mass countries out majority frameworks. there’s which law, made enable legal common law the don’t sort believe the think in anything law

consider think we’ve don’t a I government sort component. institutions we sort that feel of say, national data the There institutions certain extent regulated any see financial clients it that governor there. ago. years or made if heavily And that do data we investments we be really is with speak, you our want that that technical good industries. those about but residency And most so feel sometimes done to the issue, to want let you some geographies, large way, could several like leave a So, of what to to of wall

there have enable sometimes testing public that. in to sort and we’ve complexity there, to really, leveraging faster. why cloud so is been maintaining And those us to determine Trying that is and the Azure both Canada grow Australia and of that’s working

that testing it’s for there. of area there’s the sort turbocharge of countries. States. an and most the point United strengths massive awareness, in it I do think estate because we growth. is there’s of either like on an more think working in the I framework. of would important yes, continue legal to and we in a area household wouldn’t don’t I We But or particularly, be became continued in a real from technological I found market That’s name only to a a things on. DocuSign our obviously, investment say, things early think have I

I I us think So to we order the local. in for in more operate we big countries. we a way house get of that’s that other still sort we big there’s work And on. feel have opportunity of think other component. to our But that things certain need And

be that’s LATAM focus, a areas say UK, talked been are And sort always just of Zealand Americas, thinking the Mexico eight heavily focus talk talking as Ireland, of a we terms the focused Australia, few second original ground, terms focus in then European we’re France U.S., your Brazil, entirety focus regional, we’ve Germany, countries eight Southern Europe, the to think then one later we’ve but call I you’re there’s on I’d our seen of call call so then more question, we’ve building much areas I that I a really about terms that and invest Japan eight, sort itself, the about, area think in in. Europe. finally of thinking business which of that’s the Mexico primary about increase see those several that’s the positive really the opportunity last exactly investment in another the in the and New and sort think, of said our Wouldn’t of From started in we’re on. about. although years there has speaking And standpoint, in of and decided itself. in We of Netherlands. our we months we’ve Mexico us dramatically because markets, lot in seen country. one our investment response in countries now it the half Nordics, we that Canada, the see are to Spanish in going a would that LATAM, And technological, in over

each more I ground see do you presence very then will it know And there, on there’s are Southeast of in small Japan, And of what opportunities we’re those going got with Asia-Pac think we’ve Asia area. starting to a feet areas. those that investment us at there. massive but we’re AMZ overall, the in be don’t geographies to sort in in [ph] in look Singapore. pleased key as really I

leveraging really are investment that could core think growth DocuSign. small fit be that think Southeast to after opportunity. in that countries this Asia for were attractive across thinking we we what about In I about morning have should fact, Mike and what we literally But those about talking water about well there thinking Thailand, small, Philippine, that’s go market the a thinking in toe and

about So that’s we’re footprint. geographic how thinking the

Kirk Materne

That’s you all. super helpful. Thank

Operator

you. Thank you. [Operator Instructions] Thank

question. Please Our Securities. comes Sills Bank of with your Brad America question next from proceed with

Brad Sills

growth. and are earlier those you great. Hey, nice cases future how quarter. around Insight you congrats Is I and Oh, extensible ask we think that the feel thanks kind an wanted on to about Dan should customers how use that about a for made will, customers with guys. comment And get then what Cloud the say or into Insight, cases the cohort propensity customers under the from more? to about or buy Agreement there graduate, broader belt Agreement of towards you do evolution use Cloud, some of those maybe if their CLM starting

Dan Springer

And extension leadership such see going part we much Yes, And larger have signature she position. point, is much there. didn’t question Cynthia at open though we sphere still, to land the tip opportunity think, way describing just primary indicated we the companies. believe analytics And of be And our That increasingly sure. CLM you really what is so be I as there. for want was second most innings your very of see to I a to some do we it’s a of that even is the I Agreement mean, it it said, have rest Cloud. the is advanced in still early of the step, be today up natural continue business that to the areas will Brad, I one-two and Then, punch. entry we look that to earlier, as substantive will

by product buying that Monitor, One a which on AI seeing is DocuSign goals have agreements technology up even at their really fantastic is embedded how Insight, we’re to the looking to with customers. And just really product a feel signing of network key into new be particularly the solution. and to factor, is people solution. top called people CLM we what’s in that happening a technology security with analytic lot are for for that. understand mid-market onto analytics this that integrate idea our CLM capability and have of that That’s field going We our about you fantastic some of

about really We’re acquisition, customers their run execute uptake seeing our about can the a the from be they thesis and business whole thoughtful more around huge to want grow better operations. Seal just their They with where smarter and core that can Cloud. idea understand business, companies Agreement they the way the

of our of our think ROI AI as cases aspect the in for So that see it. to use analytics, business. we advanced business number definitely particularly the the continue accelerate about how your is think the And I value from using question people

Brad Sills

Dan. much, so Thanks

Operator

you. Thank

question with question. Blair. Suri from Please Bhavan with Our your comes next William proceed

Jake Gariup

Bhavan. is everyone. This Jake for on Hi

if when anything term, of Just several longer hear months? Seal thinking about additions Software, thinking out would color like I’d hear that. to just adoption the recent the love the last initial customer you love CLM, about and over could longest-term what to drivers, any on the surprised to that Cloud, some there’s we’re be about Agreement growth notary, And

Dan Springer

you Cynthia perspective mean a to you we your Well, look TAM. own for thoughts at planning and want I’ll then long-term. I we’re think I give mean, the different this dive of my and favorites give can you you pick. that maybe I got to

even so I it’s right, just look a it, like enthusiasm for I something signing notary amount type at of extension have many think, ways and And of huge in I though experience. an

allow notary. it to that a the opportunity really to brought same I be And special The total to think I signature important DocuSign think, so, it’s to way the that to there, CLM bring pillar. and a going is. has joy world extend TAM isn’t to that But

I at it Today, Agreement software an going think from CLM category several to we someone the crazy to that, look way. would solution. have be Cloud years within emerging and if say eSignature is to going back we’re now, that look be

thinking CLM about manage at to now That’s I the few down way would across think they we will look to business. you big be substantial years road over updates long-term. growth where and contracts the a what in the any if that? people we their and the contribute be what get not crazy I as most probably way have will, of different than our the will would you sort winner, pick the to Cynthia, if that

Cynthia Gaylor

comprehensive that Dan. that leave at think I was that And I’ll one. it fairly on

Jake Gariup

taking Thanks my question. Great. for

Operator

Thank you.

your Please with will from Pat Our JMP with come proceed question. next Walravens Securities. question

Aaron Kimson

Congrats Aaron Hi, this quarter. on for Kimson Pat. the is on

discuss that going customer You and And mentioned about that sales growth of how headcount grew level thinking company XX% success can high is forward? other you functions? then year-over-year. a versus what At percentage the was headcount

Dan Springer

is headcount simplest are Yes, costs. one the know way I I at think, distribution look you to by number the far as mean,

headcount will sales at engineering terms the and supported. year. traditionally and by that marketing see a of that you’ll our how this and you scale I’d this thing about So, groups were look I in Those we the in like a have forward are the and that talk attributable of core to across take groups see be line kind out two it from functions percentage important support that to our that the functions each of, the quarter just revenue And function. this. philosophy standpoint, the most And if the support played oftentimes have growth. And as same we line then concept our need far then product we’ve revenue, line look the buckets, to as I the of to scale functions a function, percentage the business of but are of really

we we’re So, a here engineers fantastic great have company. a building to software software, need because of lot

engineers of thing The growth. a that same And true. driver our can grow so, huge, the number of is important is we future that

driving CEO people that And One functions the are leverage If and Cynthia more focus AEs of fine, getting the we lines are want to really you growing. need CSMs about but we overhead those fine, think to customer we really our quarter like and fine, that see of don’t is those headcount were ourselves any and is want me we our on or us. carrying, more CFO operations. success, in like ourselves

Aaron Kimson

Very helpful. Thank you.

Operator

comments. would over at questions time. floor the no are to closing Thank this I turn management to back There you. any further like for

Dan Springer

Thank us. you all joining for

thank forward she guess, soon at See out But quarter. virtually be we you we’re next you look to joining little Annie talking out we’ll to the the be going market in a for physically. saw top, And bit, You hopefully all mentioned you. to us. I

Operator

today’s This conference. concludes

You time. you participation. a may wonderful disconnect your lines Thank for this evening. your Have at

DocuSign (DOCU) 4 Jun 212022 Q1 Earnings call transcript