Digital signature player DocuSign (Nasdaq: DOCU) recently announced its first-quarter results that surpassed market expectations. According to a recent report, the global Digital Signature market is projected to grow at over 20% CAGR to reach $3.8 billion by 2027 from $1 billion in 2020. Many had believed that with the economy reopening, demand for services such as those offered by DocuSign would no longer grow as fast. However, the recent results appear to have proven otherwise.

DocuSign’s Financials

Revenues for the first quarter grew 58% to $469.08 million, ahead of the market’s estimates of $436.49 million. Billing grew 54% to $527.4 million. On an adjusted basis, net income was $0.44 per share, compared with the market’s expectations of $0.28 per share.

By segment, Subscription revenues grew 61% to $451.9 million. Professional services and other revenue grew 7% to $17.1 million. Total billings of $527.4M grew 54% over the year and was higher than the market’s consensus of $466.5M.

DocuSign has been focused on expanding its international presence. During the quarter, international revenues grew an impressive 84% to $101 million, making it the 6th consecutive quarter of growth. International revenues now account for 21% of their total revenues.

For the second quarter, DocuSign forecast revenues of $479-$485 million, compared with the Street’s forecast of $486.67 million with an EPS of $0.39. DocuSign expects to end the year with revenues of $2.027-$2.039 billion, below the market’s forecast of $2.05 billion with an EPS of $1.68.

DocuSign’s Notary Product

Recently, DocuSign announced its new product, DocuSign Notary. The product is built on the flagship eSignature solution and utilizes capabilities that were added from its $38 million acquisition of Liveoak Technologies from the previous year. Notary uses secure identity-proofing technologies to lower the risk of fraud, provide a detailed audit trail in addition to a tamper-evident Certificate of Completion and recorded sessions. It enables real-time remote collaboration between notaries public and signers. It can be used on web browsers without the need for additional apps, downloads, or plugins. For customers that need to automate repeatable notarization-specific tasks, the Notary API can be used with DocuSign’s eSignature API. The service is not yet available across the country but is available in 17 states that have currently granted permission for these services.

Recently, DocuSign announced the acquisition of Clause. Based in New York and founded in 2016 by Dan Selman, Houman Shadab, and Peter Hunn, Clause is a digital contracting platform that enables contracts to be connected to real-time data from APIs, enterprise systems, and distributed ledgers. The acquisition will allow DocuSign to use Clause’s technology to catch erroneous data in contracts and agreements and prevent a defective contract from being signed. Prior to the acquisition, Clause had raised $6.3 million in four rounds of funding with the help of investors including Lawtech Sandbox, Tom Gosner, Zach Weinberg, BN Capital, Nat Turner, Block.one, Seedcamp, Lerer Hippeau, EOS VC Fund, and Galaxy Digital.

DocuSign may have benefited from the initial Covid lockdown conditions. But those customers appear to be staying on. Analysts believe that renewal efforts from customers who adopted DocuSign in 2020 for business continuity purposes could continue to expand their usage. DocuSign does have strong competition from the likes of Adobe and Dropbox, who also offer similar services. But DocuSign’s niche services have helped it manage digital agreements seamlessly while ensuring continuous product upgrades and innovations.

Its stock is trading at $250.48 with a market capitalization of $48.8 billion. It hit a 52-week year low of $152.86 in June last year. The stock had climbed to a 52-week high of $290.23 in early February.