Docusign Lifts Fiscal 2027 Revenue Outlook to $3.5 Billion
The agreement-software company guided annual recurring revenue growth to 8.50%–9.00% and said IAM would reach 18%–19% of ARR by year-end.
Docusign, Inc. (DOCU) raised its fiscal 2027 revenue outlook to $3,499 million to $3,507 million, a 9% year-over-year increase at the midpoint, after Intelligent Agreement Management’s share of annual recurring revenue accelerated in the second fiscal quarter.
The company now expects ARR to grow 8.50% to 9.00% for the year ended January 31, 2027, with a midpoint of 8.75%, and said it expects IAM to represent approximately 18% to 19% of total ARR exiting the fourth quarter of fiscal 2027. Chief executive Allan Thygesen said the company is raising its outlook as AI accelerates momentum across the business and that AI agents are now securely executing contract workflows end-to-end.
IAM accounted for 15.1% of total ARR as of July 31, 2026, compared with 12.6% as of April 30, 2026, after a prior-quarter rise from 10.8% as of January 31, 2026. The sequential step-up in mix was the quarter’s defining operating turn. Thygesen said the platform ingested a record volume of agreements.
Revenue was $875.7 million, a 9% year-over-year increase that included a benefit of approximately 1.3% from foreign exchange rates. That growth rate matched the 9% year-over-year pace in the first fiscal quarter, when the foreign-exchange contribution was about 1.6%. For the three months ended October 31, 2026, the company guided revenue of $886 million to $890 million, also a 9% year-over-year midpoint increase.
GAAP net income was $77.7 million, or $0.40 a share on a diluted basis, compared with $0.30 a share a year earlier on 211 million shares. Non-GAAP net income was $1.16 a share, compared with $0.92 a share a year earlier. GAAP income from operations was $117.6 million, or a 13.4% margin. Non-GAAP operating margin was 31.6%. The company guided non-GAAP operating margin of 31.0% to 31.5% for the full year and 31.3% to 31.7% for the October quarter.
GAAP gross margin was 79.7%, compared with 79.3% a year earlier. Non-GAAP gross margin was 81.7%, compared with 82.0% a year earlier. Sales and marketing expense was $314.0 million, or 35.9% of revenue. Research and development was $163.6 million, or 18.7% of revenue. General and administrative expense was $102.7 million, or 11.7% of revenue.
Free cash flow was $295.8 million, or a 34% margin, compared with $217.6 million, or a 27% margin, a year earlier. Net cash provided by operating activities was $334.5 million. Cash, cash equivalents, and investments were $973.1 million at quarter-end. The company repurchased $306.5 million of common stock.
Product work in the quarter included new agentic tools powered by Iris, Docusign’s contract-specific AI, an AI assistant that analyzes terms, redlines contracts and triggers workflows, pre-built agents for intake and vendor renewal, and an Agent Studio for custom agents. The company released a Model Context Protocol server, expanded Slack Marketplace and Perplexity integrations, and added a Gemini Enterprise connector to Google Cloud’s legal solution, alongside existing connectors with Anthropic, Gemini, OpenAI and Microsoft Copilot. IAM capabilities, including Agreement Manager, were integrated into Docusign CLM.
Excluding foreign-currency effects, guided revenue growth would be approximately 1.0 percentage points lower for the October quarter and 1.2 percentage points lower for the full year. Non-GAAP diluted weighted-average shares are expected to be 190 million to 195 million for the year and 191 million to 196 million for the October quarter.
More than 1.9 million customers and more than a billion people in over 180 countries use Docusign’s solutions.