Tech

DocuSign’s share price plummeted after the company weakened its guidance in the fourth quarter

Dan Springer, Chief Executive Officer of DocuSign.

David Paul Morris | Bloomberg | Getty Images

Shares of electronic signature software maker DocuSign fell more than 30% in pre-market trading on Friday after reporting lower-than-expected fourth-quarter guidance.

According to Refinitiv, DocuSign forecasts fourth-quarter revenue from $ 557 million to $ 563 million, while analysts’ quarterly revenue averaged $ 573.8 million.

Still, DocuSign exceeded analysts’ expectations for the third quarter, with earnings per share of 58 cents, adjusted for analysts’ forecast of 46 cents, and revenue of $ 545.5 million, expected at 53,100. It was a million dollars.

Several companies, including JP Morgan, Piper Sandler, UBS and Wedbush, have downgraded their shares following financial statements.Citi analyst Tyler Radke maintained a buy rating, but he lowered the target price from $ 389 to $ 231 per share, making the report “the biggest.” [software as a service] In my recent memory. “

“The pandemic tailwind stopped much faster than DocuSign expected, and the company was surprised,” JP Morgan analyst Sterling Oti wrote in a note to customers.

With the rise of remote work during a pandemic, the company has grown rapidly. DocuSign has reported revenue growth of over 40% for the sixth consecutive year, but says it expects growth of about 30% in the next quarter.

CEO Dan Springer admitted that this number would be disappointing after achieving such extraordinary growth earlier this year.

“We expected it to eventually fall from the peak level of growth achieved during the pandemic, but the environment changed faster than expected,” Springer said in a statement.

The company also said that the former CFO, President of International, left the company on November 30.

-CNBC’s Ari Levy contributed to this report.

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DocuSign’s share price plummeted after the company weakened its guidance in the fourth quarter

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