eSignature company DocuSign revealed its fourth-quarter earnings on Friday, revealing that the company posted better results than it expected and beat the estimates in both revenue and adjusted earnings per share. But despite this, the company’s shares dropped almost 23% on Friday.
DocuSign reported $0.65 adjusted earnings per share compared to an estimated $0.52, while the revenue of $659.6 million was a lot better than the expected $641 million. Still, the numbers didn’t exactly thrill the investors, who expected bigger growth compared to the last year.
“When you look at the macro environment, it certainly hasn’t gotten better, and you could probably tend to say we’ve gotten a little bit worse,” DocuSign’s CFO Cynthia Gaylor said during the earnings call.
DocuSign stock closed at $64.44 per share on Thursday before starting to slide during after-hours trading and dropping to $59.21. The Friday morning saw an even bigger fall, continuing through the day and closing at $49.69. DocuSign shares are 12.44% down year-to-date.
There are several other factors that are pushing the DocuSign stock on a downward trajectory. Besides the plummeting demand, there is also an issue of competition, with several big players entering the market, including Microsoft. It also doesn’t help that Gaylor is leaving the company later this year.