DocuSign (DOCU) Q4 2026 earnings summary

Executive summary

• Fiscal 2026 marked a pivotal year with the AI-native Intelligent Agreement Management (IAM) platform driving market leadership, strong customer adoption, and over $350 million in ARR within 18 months, representing 10.8% of total ARR and expected to reach 18% by end of FY27.

• Q4 revenue reached $837 million, up 8% year-over-year, with billings surpassing $1 billion for the first time, and ARR ending at $3.3 billion, also up 8% year-over-year.

• Achieved record non-GAAP operating margins above 30% and free cash flow exceeding $1 billion for the fiscal year, with Q4 non-GAAP operating margin at 29.5% and free cash flow margin at 42%.

• IAM is positioned as the primary growth driver, with a focus on workflow automation, AI innovation, and expanding enterprise adoption through new SKUs and consumption-based pricing.

• Expanded AI-powered agreement workflow capabilities and strategic partnerships with Microsoft Azure, Anthropic, OpenAI, and others.

Financial highlights

• Q4 total revenue: $837 million (+8% YoY); subscription revenue: $819 million (+8% YoY); professional services: $17.9 million (-3% YoY).

• Fiscal 2026 total revenue: $3.2 billion (+8% YoY); subscription revenue: $3.2 billion (+9% YoY); ARR: $3,272 million (+8% YoY).

• Q4 billings: $1 billion (+10% YoY); full-year billings: $3.4 billion (+10% YoY).

• Q4 non-GAAP gross margin: 81.8%; fiscal 2026 non-GAAP gross margin: 82.0%.

• Q4 non-GAAP diluted EPS: $1.01 (up from $0.86); GAAP diluted EPS: $0.44 (up from $0.39).

• Q4 free cash flow: $350 million (+25% YoY); full-year free cash flow: $1.07 billion (33% margin).

Outlook and guidance

• Fiscal 2027 ARR expected to grow 8.25%-8.75% YoY, reaching $3.551 billion at midpoint.

• IAM projected to represent ~18% of total ARR by end of fiscal 2027, exceeding $600 million.

• Fiscal 2027 total revenue guidance: $3.484-$3.496 billion (+8% YoY midpoint); Q1 revenue: $822-$826 million (+8% YoY midpoint).

• Fiscal 2027 non-GAAP gross margin: 81.5%-82.0%; non-GAAP operating margin: 30.0%-30.5%.

• Revenue guidance excludes positive FX impact of 1.6 percentage points for Q1 and 1.4 points for FY27.