DocuSign Inc Q1 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Jacob Roberge - William Blair & Company LLC - Analyst : Hi, thanks for taking the questions. Blake, could you just help us understand how releasing consumption trends were factored into your subscription guide? Sounds like consumption improved in the quarter, but it doesn't like the full subscription B was pushed into the guide. So I'm curious if you're starting to see any impact on the Nasdaq as you exited the quarter. Again, it is really just conservatism and getting out and finding any potential macro headwinds. Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, DOCU.OQ - Q1 2025 DocuSign Inc Earnings Call

Question: Tyler Radke - Citigroup Inc. - Analyst : Thanks for taking the question. (technical difficulty) to ask you clearly a lot of announcements and momentum with the announcement of IAM. Can you just help us understand how specifically the Lexion deal fits into that vision? Do you feel like with the combination of, Lexion, in your core eSignature, so some of the assets around the SpringCM and [SEO] and you have the complete product. Are there other areas you're looking for? And then just any feedback that you could share from customers post that launch and how it's being perceived? Thank you.

Question: Brent Thill - Jefferies LLC - Analyst : Thanks. Blake, 20.5% op margin in Q1, yet you're guiding below that at the midpoint for the full year. I guess when you think about the investments need to happen, kind of hit that range, can you walk through what would cause margins to go down to make that number for the year?

Question: Brent Thill - Jefferies LLC - Analyst : And just quickly for Alan, I think your aspirations to be a double-digit grower, I know you're not guiding for that this year, but is there anything that still, it was inherently obstacle in your way that to achieving that longer-term goal? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, DOCU.OQ - Q1 2025 DocuSign Inc Earnings Call

Question: Pat Walravens - JMP Securities LLC - Analyst : Great. Thank you. The launch of the IAM platform is super exciting, but it does make me wonder what do you guys going to do in terms of creating a repeatable go-to-market motion? How are you going to sell this in a consistent manner given the way it's rolling out and the old products versus the new ones?

Question: Rishi Jaluria - RBC Capital Markets - Analyst : Wonderful. Thank you so much for taking my question. I just want to drill a little bit into Lexion. You mentioned it's immaterial, but you paid $135 million for it. It's got hundreds of customers. Maybe can you walk us through of the raise and the guide for the full year? How much of that is attributable to Lexion versus improved execution? Maybe you could just give us a little bit of color for our own models, how to think about Lexion? Thank you.

Question: Josh Baer - Morgan Stanley - Analyst : Great. Thank you very much. I wanted to stick to IAM. Wondering what capabilities are missing or need to be rolled out in order to serve the broader market -- upmarket in the enterprise? And was wondering if you could shine a little light on what happens from an economic standpoint as customers adopt IAM.

Question: Scott Berg - Needham & Company, LLC - Analyst : Hi, everyone. Thanks for taking my questions. I have two. Let's start with the continuing theme on IAM. I was obviously at the conference, customer interest is high. It sounds like investor interest is high on it too, and it almost seems like this is probably your big bet for the next leg of growth for the company. But how do we think about the impact of the model here going forward? It was just released. I know it's going to be released to the commercial customers first and gradually moved up-market as you build out the future functionality set. But is this a play for fiscal '27 or fiscal '28? Or do you think we can see some revenue impact maybe as early as next year that's at least somewhat meaningful to the overall profile of the company?

Question: Scott Berg - Needham & Company, LLC - Analyst : Got it. Helpful. And then I just wanted to follow up on the stability comments from earlier. Now that you feel that the business seems to be at least in a right position, how do we think about upside to revenues over the near term? Does it come more from the installed base with some of the stability there, or is the upside driven more from net new sales and net-new customers coming on board in this macro where everything is a little bit challenging? Just wanted to see how you kind of balance those two and what might be the greater driver in the near term. Thanks.

Question: Brad Sills - BofA Securities - Analyst : Great. Thank you so much. I wanted to ask a question here on IAM, exciting new launch here. As you guys make the pivot from more transactional eSignature to more of the suite approach here where you're getting more into workflow automation. Can you speak to the level of preparedness for the sales channel to make that type of a consultative sale? I know these things don't happen overnight. If you could just speak to kind of the roadmap there for making that transition towards a more strategic vendor in a more consultative sale? Thank you.

Question: Michael Turrin - Wells Fargo Securities, LLC - Analyst : Hey, great. Thanks. I appreciate you taking the question. Blake, you had a comment around Q2 as the trough in terms of billings growth, and so I wanted to give you a chance to expand on what drives that. How much is it visibility, how much of it is getting out of tougher renewal cohorts, or other factors at play that are driving the expected improvement as we work further into the year?

Question: Michael Turrin - Wells Fargo Securities, LLC - Analyst : Okay. Just a small follow-up. Is there anything we should be mindful of in terms of the added functionality, the broader agreement platform that could change the renewal dynamics either having kind of pulled any activity into anything ahead of that or could just add complexity that's better longer term but impactful near-term that we should be thinking about at all here? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, DOCU.OQ - Q1 2025 DocuSign Inc Earnings Call

Question: Arsenije Matovic - Wolfe Research, LLC - Analyst : Hi. This is Arsenije Matovic on for Alex Zukin from Wolfe Research. So following up on a prior question and not asking for what the contribution is, but simply excluding Lexion, would your full-year guidance for revenue and subscription revenue have been raised on an organic basis? And just on macro, has your outlook changed since you first set full-year guidance? Thank you.

Question: Karl Keirstead - UBS Investment Bank - Analyst : Okay. Great. Thanks. Maybe I'll direct this to Blake. Blake, on the Q1 numbers, it's good to hear your color commentary around the core stabilizing and new logos being good, and transaction volumes being good. But objectively, when we look at Q1, it was a very skinny revenue beat and revenues were down sequentially and the billings beat was normal to a little bit light. So actually, the numbers don't support the view that things are stable or improving. It feels like there must have been some kind of offset that you saw. Maybe it was that 4Q was super strong and it left the tank a little dry for 1Q. I'm just trying to figure out why Q1 wasn't a little bit more robust if, in fact, your commentary about demand is that it was in fact pretty stable. Thank you.

Question: Karl Keirstead - UBS Investment Bank - Analyst : Okay, that's encouraging. Thanks, Blake.

Question: Sonak Kolar - JPMorgan Chase & Co. - Analyst : Hi. This is Sonak Kolar on for Mark Murphy. Thanks for taking the question. Blake, can you walk us through what might be embedded in the forecast for the back half in some of the more rate-sensitive end-markets such as real-estate given mortgages? I'm just looking at the concerns around the backdrop of higher for longer and want to see how that might be impacting the guide. And then I also had a quick follow-up on IAM for Allan. Just in the early days of IAM adoption, is it so far trending faster than the initial launch of CLM several years ago?

Question: George Iwanyc - Oppenheimer & Co. Inc. - Analyst : Thank you for taking my question. Alan, could you drill down a little bit more into the strength you're seeing with the self-serve motion and that digital efforts? And maybe I should expand on that, provide some perspective on what you're seeing with SMBs.

Question: George Iwanyc - Oppenheimer & Co. Inc. - Analyst : Thank you.