DocuSign’s Revenue by Segment (2018 – 2022)

This statistic highlights DocuSign’s Revenue by Segment, split between subscription, professional services and other segments, reported on a quarterly basis from Q1 2018 onwards.

DocuSign’s Revenue by Segment

(Note: DocuSign’s fiscal year ends on 31st January, All figures in millions, except percentages)

Subscriptions account for most of the revenue generated by DocuSign. Even in Q2 2022, a substantial part of its revenue (96.27%) came from its subscriptions. However, over the past years, the revenue from professional services and other sources has also witnessed an increase. For Q2 2022, the company’s revenue has increased by almost 50% on a yearly basis. On a quarterly basis, the revenue for Q2 2022 has increased by 9%. As the company recognizes the revenue over the term of a contract (lasting from one year to three years), it is possible to detect a fall in sales only in the future quarters.

Subscription 

Subscription revenue consists of fees for the use of the software suite and access to customer support, which includes phone or email support. DocuSign offers a unique cloud software suite called DocuSign Agreement Cloud that helps in the automation and integration of the agreement process. For this service, the customers are invoiced in advance, on an annual basis.

DocuSign has continued to invest in a variety of customer programs and initiatives, that have helped increase its subscription revenue over time. It is expected that the subscription revenue will continue to increase, as the existing customers increase their usage across their organizations. DocuSign constantly tries to offer new functionality to attract new customers and to fully realize the potential of their acquisitions in their product offerings.

The subscription income has always seen an increasing trend. This can be attributed to DocuSign’s business model. They offer access to their platform, only on a subscription basis with prices based on the functionality their customers require.

However, a majority of DocuSign’s subscription contracts are on yearly basis and there is no guarantee that the customers will renew them. If the customers cancel their subscriptions or if they reduce their subscription amounts at the time of renewal, the revenue will decline, and hence, the business may suffer. Thus, the market price of their stock can be highly volatile and may fluctuate substantially as a result of a variety of factors, one of which being changes in the prices of subscriptions.

Professional Services and Other 

This segment includes fees associated with new customers who request deployment and integration-related services. These services are priced on time and materials available and, on a fixed fee basis. Generally, the revenue from these services is recognized as the services are performed or upon the completion of contracts. Amounts from the sale of on-premises solutions comprise the other forms of revenue.

This category of revenue contributed to only 3.73% of the total revenue generated in Q2 2022. Unlike subscription revenue, this category of revenue does not have consistent growth. Despite the little contribution to the company’s revenue, this segment plays a pivotal role in ensuring customer retention.

About DocuSign

Founded in 2003, DocuSign provides software solutions for the automation of the agreement process. The company derives most of its revenue from the sales of its e-Signature solutions. These solutions are easy to use, developer-friendly, and safe. DocuSign is headquartered in California and caters to the needs of more than 8,90,000 customers. The company employs more than 5,500 employees. DocuSign’s stocks are listed on NASDAQ under the ticker symbol “DOCU”. The company’s stocks are a component of NASDAQ-100.

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