DocuSign (NASDAQ:DOCU) stock advanced slightly in early trading before dropping after the company reported stronger-than-expected fiscal first-quarter results and raised its guidance after the market close. The company has an artificial intelligence (AI) analytics business and has said that it would use AI to generate summaries of deals. In conjunction with its Q1 results, DOCU pushed back against the idea that its business would be hurt by the advent of AI-powered chatbots.
The company enables individuals and companies to electronically sign legal contracts.
After some positive early trading, DOCU stock has now dipped into the red by about 0.5%.
DocuSign’s Beat-and-Raise Q1 Results
DocuSign’s top line rose 12% year-over-year to $661 million, above analysts’ mean estimate of $541 million. Its earnings per share came in at 72 cents, 16 cents above the mean estimate. Its billings rose 10% YOY to nearly $675 million, versus its guidance of $615 million to $625 million.
Finally, DOCU now expects to generate revenue of $2.713 billion to $2.725 billion for its current fiscal year, slightly above its previous outlook of $2.695 billion to $2.707 billion.
DocuSign and AI
DocuSign has an AI business called SealSoftware which it acquired three years ago. Among Seal’s capabilities are searching contracts by concepts and comparing clauses and terms. It also creates “actionable insights.” Further, DOCU intends to use ChatGPT to generate summaries of its customers’ contracts.
Its head of investor relations, Allan Thygesen, said that the company will not be hurt by chatbots like ChatGPT because of its “deep experience” when it comes to creating contracts.
The Performance of DOCU Stock
DOCU stock has climbed 2% in the last five days and 18% in the last month. However, it has still dropped 12% in the past three months and 10% in the previous 12 months.
On the publication date, Larry Ramer did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
