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Digital signature services provider Docusign (Nasdaq: DOCU) recently announced strong quarterly results. The company is looking to expand its market reach through a focused AI-based strategy for document management.

Docusign’s Financials

Revenues for the fourth quarter grew 7% to $709.6 million. Billings improved 5% to $709.5 million. Adjusted earnings came in at $0.82 per share compared with $0.72 per share a year ago. Analysts estimates revenues of $706.1 million and an EPS of $0.79.

Subscription revenues grew 8% to $691.5 million, compared with $639.3 million a year ago. Professional services revenues fell 18% from $22 million to $18.2 million in the quarter.

For the first quarter, Docusign forecast revenues of $725-$729 million and billings of $715-$725 million, compared with the Street’s forecast of revenues of $724.2 million. Docusign expects to end the fiscal year 2025 with revenues of $2.920-$2.932 billion compared with the market’s forecast of $2.92 billion.

Docusign’s Lexion Acquisition

Docusign recently announced a focused effort in building out an Intelligent Agreement Management suite of services. Docusign IAM is a platform and suite of applications that will help businesses transform agreement data into insights and actions, accelerate contract review cycles, and boost productivity. The Docusign IAM platform and applications will seamlessly connect the different components of the agreement management process and leverage AI to accelerate the various steps involved in the management of contracts.

Some of the solutions included in the IAM include Docusign Navigator – a smart repository that enables organizations to centrally store, manage, and analyze agreements from any source, Docusign Maestro that helps users create customizable agreement workflows, and Docusign App Center that builds upon its ecosystem of developers and partners so users can discover, install, and connect a wide variety of apps to integrate their existing systems into Docusign IAM.

As part of this initiative, it announced the acquisition of Lexion, a leading provider of AI-powered agreement management software, for $165 million in cash. Founded in 2019, Lexion is known for its simple agreement workflow platform. Its innovative AI-based agreement technology simplifies and centralizes the contract process, thus accelerating the drafting, negotiation, and review of the documents. Its suite of intelligent solutions are designed for creating automated workflows and extracting vital information from contracts.

Lexion was founded by Gaurav Oberoi, Emad Elwany, and James Baird, who met at the Allen Institute for AI in 2018. The evolution of natural language processing technology motivated them to create a solution that used this tech to eliminate tedious work. They saw the opportunity to create an offering that automatically extracted key details from contracts to free legal teams from smaller tasks. By 2019, they had created Lexion.

Docusign plans to integrate Lexion with its Intelligent Agreement Management solutions that will help revolutionize how agreements are created, managed, and analyzed for organizations. Prior to the acquisition, Lexion was privately held and had raised $35 million at an undisclosed valuation. Its last round of funding was held in April last year when it raised $20 million in a round led by Citi Ventures for an undisclosed valuation.

Docusign’s stock is trading at $51.69 with a market capitalization of $10.6 billion. It hit a 52-week low of $38.11 in October last year and hit a 52-week high of $64.76 in December when there was news of a possible buyout.

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