Shares of DocuSign Inc. (NASDAQ:DOCU) fell sharply on Friday despite the e-signature company’s better-than-expected first-quarter results, as investors focused on modest billings growth and a guidance increase that appeared largely driven by currency tailwinds rather than accelerating demand.



Key analyst takeaways:



<ul>
<li>BTIG analyst Allan Verkhovski reiterated a Buy rating, while cutting the price target from $70 to $60.</li>



<li>Needham analyst Scott Berg maintained a Hold rating on the stock.</li>
</ul>



Check out other analyst stock ratings.



BTIG: Although DocuSign reported its revenues $6 million higher than estimates, this was much lower than the average revenue beats of $15 million through fiscal 2026, Verkhovski said in a note. The company delivered current subscription billings growth of 4.6%, driven by currency benefits and only &#34;modestly above&#34; the 4.2% growth posted in each of the prior two first-quarter periods, he added.



CEO Allan Thygesen indicated early signs of recovery in the enterprise segment, including customers with ACV (annual contract value) of more than $300,000 growing to the double digits, supported by positive IAM adoption trends, the analyst stated. &#34;We continue to believe DOCU will outperform its ARR guidance, which we estimate implies 17% growth (vs. 42% growth in FY26) in NNARR from expansion and new business, or excluding GRR improvements,&#34; he further wrote.



Needham: DocuSign reported a modest revenue upside in constant-currency terms. Cost discipline drove the profit beat, Berg said. He noted that:



<ul>
<li>Revenue grew 8.7% year-on-year to $830.2 million, topping Needham's estimate of $824.2 million</li>



<li>Non-GAAP earnings came at $1.09 per share, above Needham's estimate of $1.00 per share</li>
</ul>



Although management raised their fiscal 2027 revenue guidance to $3.490-$3.502 billion, or 8.6% growth at the mid-point, from their prior outlook of $3.484–$3.496 billion, or 8.4% growth, this incorporates currency benefits of around 1.3%, indicating that the guidance was &#34;largely unchanged,&#34; the analyst stated.



He added, however, that DocuSign's &#34;execution story&#34; continues to improve, driving higher visibility into the company’s fiscal 2027 goal of accelerating ARR growth over the previous year's levels.



DOCU Price Action: Shares of DocuSign had declined by 6.77% to $47.49 at the time of publication on Friday.



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DOCU

DocuSign shares dropped despite Q1 earnings beating expectations, as investors focused on modest billings growth driven by currency tailwinds rather than demand. Analysts remained cautious; BTIG lowered its price target to $60, citing revenue overages below historical averages, while Needham maintained a Hold rating. CEO Allan Thygesen noted early enterprise recovery signs.

DocuSign's Q1 Beat, Raised FY Outlook Fails To Impress Analysts