Group 1: Software Sector Overview - The software sector has experienced its most significant downturn in history, with approximately 73% of software stocks now classified as oversold, marking the highest level on record [1] - The broader tech sector is also affected, with around 45% of tech stocks entering oversold territory [1] Group 2: Notable Companies - Three companies, DocuSign (DOCU), Intuit (INTU), and Atlassian (TEAM), stand out as they exhibit oversold conditions while maintaining perfect 100% Barchart opinion scores, indicating strong fundamental support despite market pressures [2][3] Group 3: DocuSign's Performance and Strategy - DocuSign's stock has declined alongside the software market, but the CFO presented a strong case for the company's future at a recent investor conference, emphasizing the importance of Intelligent Agreement Management (IAM) [4] - The IAM product has gained significant traction, with customer numbers increasing from 10,000 in April to over 25,000 in the latest quarter, showcasing robust growth since its launch in mid-2025 [5] - DocuSign has amassed 150 million consented agreements on the IAM platform, which enhances its data advantage and improves recall precision by 15 percentage points compared to public contract data [6] - The company has nearly 1.8 million customers and approximately 275,000 direct sales customers, with IAM users increasing their e-signature volume, creating a positive feedback loop that benefits both IAM and e-signature services [7]

Core Insights - Docusign has evolved from a leading e-signature technology provider to a comprehensive suite of software tools for managing the entire contract lifecycle, which gained significant traction during the COVID-19 pandemic [1] - The stock reached an all-time high of $310 in late 2021 but has since fallen 81% as conditions normalized [2] - The launch of the Intelligent Agreement Management (IAM) platform, which leverages AI for contract management, is seeing strong demand and may drive a stock recovery [3] Company Developments - IAM addresses inefficiencies in contract management, with Deloitte estimating that businesses lose $2 trillion annually due to these inefficiencies [5] - Key features of IAM include a digital repository called Navigator for easy contract storage and retrieval, and AI-Assisted Review to identify risks and opportunities in contracts [5][6] - As of the end of Docusign's fiscal 2026 third quarter, over 25,000 businesses adopted IAM, marking a 150% increase from six months prior [7] Market Context - Docusign's tools were crucial for businesses to continue operations during the pandemic, but demand decreased as social conditions improved in 2022, leading to a significant drop in stock value [8]

Financial Data and Key Metrics Changes - Revenue for Q3 was $818 million, an increase of 8% year-over-year, while billings reached $829 million, up 10% year-over-year [5][15] - Non-GAAP operating margin was 31%, and free cash flow grew 25% year-over-year to $263 million, representing a 32% margin [5][22] - Non-GAAP diluted EPS for Q3 was $1.01, up from $0.90 last year, while GAAP diluted EPS was $0.40 compared to $0.30 last year [23] Business Line Data and Key Metrics Changes - The Intelligent Agreement Management (IAM) platform saw significant growth, with over 25,000 paying customers by the end of Q3, up from over 10,000 in April [6][20] - Dollar net retention improved to 102%, up from 100% in the prior year, indicating strong customer engagement and usage [20] - The e-signature business also performed well, with utilization rates at multi-year highs and consistent positive growth in envelopes sent [7][40] Market Data and Key Metrics Changes - International revenue reached approximately 30% of total revenue for the first time, growing 14% year-over-year [8][21] - Total customers grew 9% year-over-year, ending the quarter at nearly 1.8 million, with significant growth in customers spending over $300,000 annually [21] - The company hosted momentum events in Sydney, Singapore, and Tokyo, reflecting growing interest in IAM [8] Company Strategy and Development Direction - The company remains focused on delivering sustainable, profitable double-digit growth, with a commitment to operational efficiency and product innovation [5][14] - IAM is positioned as a key growth driver, with plans to enhance its integration with existing business systems and expand its ecosystem of third-party integrations [10][12] - The company is transitioning to reporting Annual Recurring Revenue (ARR) and will no longer report billings starting in fiscal 2027, aiming for better transparency in growth metrics [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business, with strong demand for IAM and e-signature solutions [15][20] - The company anticipates continued growth in ARR driven by expansion opportunities and improved retention rates [30][50] - Management acknowledged the importance of maintaining operational efficiency while navigating macroeconomic conditions [22][58] Other Important Information - The company achieved FedRAMP moderate and GovRAMP authorization for IAM, enhancing its credibility in security and compliance [13] - The company plans to continue opportunistic share repurchases, having repurchased $215 million in shares during Q3, the largest quarterly buyback in its history [23][54] Q&A Session Summary Question: Transition to ARR and its impact on growth - Management indicated that while ARR is not yet disclosed, the trajectory of billings growth serves as a good proxy for business performance moving forward [30] Question: Early renewal cohorts and expansion opportunities - Management noted that early renewal cohorts are showing strong retention rates, with larger companies likely to expand their IAM deployments upon renewal [32][34] Question: Future monetization opportunities with Navigator - Navigator is seen as a foundational capability for IAM, with various use cases expected to emerge as the platform matures [35][36] Question: Billings growth and subscription revenue guidance - Management explained that the guidance for Q4 reflects a deceleration from Q3 due to prior year comparisons and early renewal impacts [38] Question: Macro environment impact on envelope volumes - Management reported consistent growth in envelope volumes and utilization rates, indicating strong customer engagement across verticals [40][58]

Core Insights - Both Skillsoft (SKIL) and Docusign (DOCU) are focusing on enterprise software and productivity solutions, with SKIL providing cloud-based learning and DOCU offering eSignature and contract lifecycle management solutions [1] Group 1: Skillsoft (SKIL) - SKIL's revenue trajectory has shown improvement, with a 4% increase in revenues after a 7.4% sequential dip in Q1 FY2026 [2] - The Talent Development Solutions (TDS) segment remained flat at $101 million, while the TDS Enterprise Solution has seen four consecutive quarters of revenue growth, contributing over 90% to the TDS segment [2] - The Global Knowledge segment reported $28 million in revenues, down 10% year-over-year but up 12% sequentially [2] - Adjusted EBITDA margin expanded by 70 basis points and 60 basis points, attributed to prudent expense management and operational enhancements [3] - SKIL experienced a 50% year-over-year increase in technology learners, with AI learners and AI learning hours surging 74% and 158% year-over-year, respectively [3] - Management has cut the revenue outlook to $510-$530 million from $530-$545 million due to macroeconomic and geopolitical instability [4] - SKIL reported a net loss of $23.8 million in Q2 FY2026, an improvement from a $39.6 million loss in the same quarter last year [4] - The company faces competition from established players like Coursera and Udemy, necessitating rapid investments that could lead to further losses [4] Group 2: Docusign (DOCU) - DOCU's revenue increased by 9% year-over-year and 4.8% sequentially in Q2 FY2026, reflecting strong subscription revenue growth [5] - Subscription revenues, which account for 98% of total revenues, rose 9% year-over-year and 5% sequentially, indicating robust customer retention [5] - Billing climbed 13% year-over-year, outpacing revenue growth, showcasing strong demand and pricing power [5] - Dollar net retention increased to 102%, reinforcing customer base retention [5] - Management raised the fiscal 2026 revenue guidance to $3.189-$3.201 billion from $3.151-$3.163 billion [5] - DOCU maintains a solid balance sheet with cash reserves of $844 million and no current debt, generating $218 million in free cash flow during Q2 FY2026 [6] - Despite strong revenue growth, DOCU faced a 20-basis point decline in adjusted gross margin and a 240-basis point drop in adjusted operating margin, raising concerns about sustainable profitability [7] - Competition from major players like Adobe Acrobat Sign poses additional risks to DOCU's growth potential [8] Group 3: Comparative Analysis - The Zacks Consensus Estimate for SKIL indicates a year-over-year decline of 2.8% in sales and 19.6% in EPS for fiscal 2026 [9] - In contrast, DOCU's estimates show a year-over-year increase of 7.3% in sales and 3.9% in EPS for fiscal 2026 [10] - SKIL is trading at a 12-month forward price-to-earnings ratio of 2.16, lower than its median of 3.95, suggesting it may be undervalued compared to DOCU, which has a forward P/E ratio of 17.26 [11] - Both companies present compelling growth narratives, with SKIL showing consistent growth and momentum in AI learning, while DOCU benefits from strong customer retention and a solid balance sheet [13] - SKIL is anticipated to offer better growth potential due to its undervaluation, providing a margin of safety that lowers downside risks [14]

Core Insights - Docusign's stock experienced significant growth during the COVID-19 pandemic, reaching a peak of $310 in September 2021, but has since declined by 78% to $67 as demand normalized in 2022 [1][2] Group 1: Company Performance - The introduction of the Intelligent Agreement Management (IAM) platform aims to simplify agreement management processes and is helping Docusign regain some momentum [3] - Docusign's stock has fallen significantly due to the slowdown in demand for its products post-pandemic [9] Group 2: Market Opportunity - The IAM platform addresses a $2 trillion issue in the business community related to inefficient agreement management processes, referred to as the "agreement trap" [5] - The Navigator feature within IAM allows businesses to store and search digital documents efficiently, significantly reducing the time employees spend on manual searches [6] Group 3: Product Features - Navigator has seen a 150% increase in the number of documents processed in the fiscal 2026 second quarter compared to six months prior [7] - Other IAM features include AI-Assisted Review, which identifies risks and opportunities in contracts, and Maestro, which enables the creation of agreement workflows without coding [8]

Group 1 - Docusign has been selected for the 2025 Fortune Future 50 list, recognizing its strong potential for sustained growth and long-term rewards for stakeholders [1][2][3] - The Fortune Future 50 list is based on a comprehensive "Net Vitality Score" derived from over 10 million data points across 25 key metrics, assessing corporate vitality for predicting long-term growth [2][3] - Docusign serves over 95% of Fortune 500 companies, indicating its strong market presence and performance in the Intelligent Agreement Management (IAM) sector [3][5] Group 2 - The Fortune Future 50 list has a history of identifying high-performing companies, with an average annual total return of 12%, outperforming the MSCI World stock index by 1.4 percentage points [4] - The selection process evaluates companies based on four core dimensions: Strategy, Technology, Talent, and Culture, using an AI algorithm and various metrics [7]

Core Viewpoint - Docusign's stock has significantly declined from its peak, but the launch of its new AI-powered platform, Intelligent Agreement Management (IAM), presents a potential investment opportunity as it addresses a $2 trillion problem in contract management [2][4][17]. Group 1: Company Performance - Docusign went public in 2018 at $29 per share and peaked at $310 by mid-2021 due to increased demand during the COVID-19 pandemic [1]. - The company's stock is currently trading 75% below its peak, reflecting a slowdown in business as social conditions normalized in 2022 [2]. - In the fiscal 2026 first quarter, Docusign reported $763.7 million in revenue, an 8% increase year-over-year, exceeding management's forecast [8]. - The company's operating expenses grew by only 1.6% year-over-year, leading to a 166% increase in operating profit to $60.2 million [9]. - Docusign's net income for the same quarter was $72.1 million, a 113% increase compared to the previous year [10]. Group 2: New Product Launch - The IAM platform aims to solve poor contract management processes that cost businesses $2 trillion annually [4]. - IAM includes tools like Navigator, which stores contracts and uses AI to extract important information, making contract management simpler [5]. - The AI-Assisted Review tool helps identify problematic clauses in contracts and can reduce legal expenses for businesses [6]. - Docusign's international IAM sales surged by 50% from the previous quarter, indicating strong demand for the new platform [7]. Group 3: Valuation and Investment Potential - Docusign's price-to-sales (P/S) ratio has dropped to 5.4, significantly lower than its long-term average of 12.4, suggesting the stock may be undervalued [13][14]. - The company is shifting focus towards profitability rather than aggressive revenue growth, which may lead to more sustainable long-term performance [12]. - If Docusign continues to generate consistent GAAP profits, it could eventually be valued using the price-to-earnings (P/E) ratio, enhancing its attractiveness as an investment [16].

Core Insights - DocuSign (DOCU) is transforming agreement management with its Intelligent Agreement Management (IAM) platform, which is the fastest-growing new product in the company's history, moving beyond traditional e-signature tools [1][7] Integration and Partnerships - The IAM platform's strength lies in its integration with major enterprise players like Microsoft and Salesforce, facilitating seamless workflows within existing organizational tools [2][3] - Microsoft integration allows users to manage agreements directly from Microsoft 365 applications, enhancing operational efficiency [3] - Salesforce integration enables collaboration among sales, legal, and procurement teams, improving visibility and reducing turnaround time for agreements [3] Comprehensive Digital Agreement Platform - IAM represents DocuSign's shift towards a complete digital agreement platform, supporting all stages of the contract lifecycle with AI-driven insights that enhance decision-making and compliance [4][5] - By embedding itself within enterprise ecosystems, DocuSign is creating a strong dependency on its IAM platform, making it essential for digital transformation initiatives [5] Stock Performance and Valuation - DOCU's stock has declined by 12% year to date, while the industry has seen a 16% rally [6] - The stock trades at a forward price-to-earnings ratio of 21.73, which is lower than the industry's 40.18, indicating a Value Score of D [9] - The Zacks Consensus Estimate for DOCU's second-quarter fiscal 2025 earnings has been increasing over the past 60 days [10]

Core Insights - Docusign (DOCU) is set to report its first-quarter fiscal 2026 results on June 5, with revenue expectations of $747 million, reflecting a 5.3% year-over-year growth, while earnings per share are estimated at 81 cents, indicating a 1.2% decline from the previous year [1][3] Financial Performance - The consensus estimate for subscription revenues is $730.8 million, representing a 5.7% increase year-over-year, driven by the adoption of Intelligent Agreement Management (IAM), increased feature usage, and upgrades to higher-tier plans [5][7] - The professional services and other revenues are projected at $16.1 million, showing an 11.4% decline compared to the same quarter last year [5] Earnings Expectations - Docusign currently has an Earnings ESP of 0.00% and a Zacks Rank of 4 (Sell), indicating lower chances of an earnings beat this quarter [3] - The company has a history of surpassing earnings estimates, with an average surprise of 8% over the last four quarters [2] Market Performance - Docusign's stock has increased by 67.7% over the past year, outperforming the industry average of 35.5% and the Zacks S&P 500 composite's 13.2% rise [8] - The current price-to-earnings ratio for DOCU is 24.96X, which is lower than the industry average of 37.6X, but higher than BILL Holdings at 18.99X and slightly lower than BlackLine at 25.45X [11] Product Development - The launch of IAM in 2024 aims to enhance agreement management through AI, contributing over 20% to direct sales in the fourth quarter of fiscal 2025 [12][13] - Despite early sales success, concerns remain regarding the product's scalability and early monetization challenges [13][17] Liquidity Concerns - Docusign's current ratio is 0.81, significantly below the industry average of 2.38, indicating potential liquidity issues [15] - The low current ratio raises concerns about the company's ability to meet short-term obligations effectively [15]

Core Viewpoint - Docusign, Inc. (DOCU) has shown strong performance over the past year, with a 31.6% increase in share price, significantly outperforming its industry and the Zacks S&P 500 Composite [1][4]. Group 1: Performance Analysis - DOCU shares have gained 5.7% in the last six months, while the industry and Thryv Holdings have seen declines of 5.4% and 33.3%, respectively [4]. - The stock closed at $76.39, down 41.2% from its 52-week high of $107.86 [4]. - DOCU's trailing 12-month return on equity (ROE) is 42.2%, surpassing the industry average of 31.7% [10]. Group 2: Product Development - Docusign launched Intelligent Agreement Management (IAM), an AI-powered platform aimed at enhancing agreement management, which has shown a high adoption rate [6][7]. - IAM contributed over 20% of direct sales in Q4 of fiscal 2025 and is expected to generate a low-double-digit percentage of recurring subscription revenue by Q4 of fiscal 2026 [7][8]. - The company added 56 customers with annual contract value (ACV) exceeding $300,000 in Q4 of fiscal 2025, indicating a rebound in enterprise expansion [9]. Group 3: Financial Outlook - The Zacks Consensus Estimate for Docusign's fiscal 2026 revenues is $3.1 billion, reflecting a 5.3% year-over-year growth [12]. - Despite strong top-line prospects, the bottom-line outlook appears weak, with potential challenges in IAM monetization and a concerning liquidity position [16]. Group 4: Liquidity Concerns - Docusign's current ratio is 0.81, below the industry average of 2.54, indicating a troubling liquidity position [14]. - The current ratio has declined from 0.83 in the previous quarter and 0.94 in the year-ago quarter, primarily due to increased short-term debt [14].