DocuSign (DOCU) Q1 2026 earnings summary

Executive summary

• Q1 FY26 revenue reached $764M, up 8% year-over-year, driven by IAM platform adoption, digital revenue growth, and strong performance across commercial, enterprise, and digital channels.

• Operating margin improved to 29.5% non-GAAP, with free cash flow margin at 30%, and net income rose to $72.1M from $33.8M year-over-year.

• Over 1.7M customers globally, including 1,123 with annualized contract value over $300,000, and more than 10,000 IAM customers.

• Announced a $1B increase to the stock repurchase program, bringing total authorization to $1.4B, and secured a new $750M credit revolver.

• Continued innovation with new AI-powered IAM features, expanded CLM integrations, and global expansion through partnerships and self-serve channels.

Financial highlights

• Total revenue: $764M (+8% YoY); subscription revenue: $746M (+8% YoY, 98% of total); international revenue: $217M (+10% YoY, 28% of total).

• Billings: $740M (+4% YoY), slightly below guidance due to lower early renewals.

• Non-GAAP gross margin: 82.3%; GAAP gross margin: 79.4%; non-GAAP operating margin: 29.5%.

• Free cash flow: $228M (30% margin); cash and investments: $1.1B; no debt.

• Non-GAAP diluted EPS: $0.90 (vs. $0.82 last year); GAAP diluted EPS: $0.34 (vs. $0.16 last year).

Outlook and guidance

• Q2 revenue guidance: $777M–$781M; FY26 revenue: $3.151B–$3.163B; subscription revenue: $760M–$764M for Q2, $3.083B–$3.095B for FY26.

• Q2 billings: $757M–$767M; FY26 billings: $3.285B–$3.339B; billings growth expected to accelerate in H2 FY26.

• Non-GAAP gross margin guidance: 80.5%–81.5% for Q2; 80.7%–81.7% for FY26; non-GAAP operating margin: 26.5%–27.5% for Q2, 27.8%–28.8% for FY26.

• Guidance reflects Q1 strength, neutral FX, and conservative assumptions on early renewals and bookings.

• Cloud migration expected to be a 1% headwind to gross margin for FY26.