Q2 2025 DocuSign Inc Earnings Call Transcript
Key Points
- DocuSign Inc (DOCU) reported Q2 revenue of $736 million, up 7% year-over-year for the second consecutive quarter.
- Non-GAAP operating margins increased to 32%, an all-time high, with significant improvement from 25% in Q2 fiscal '24.
- Free cash flow generation remained strong, approaching $200 million, resulting in a 27% yield for the quarter.
- The new Intelligent Agreement Management (IAM) platform has shown promising early results with higher customer win rates, larger deal sizes, and faster time to close.
- International revenue represented 28% of total revenue and grew at approximately double the rate of overall revenue, indicating strong global expansion.
- Billings growth was only 2% year-over-year, impacted by last year's strong on-time renewal performance and timing impacts of various customer contracts.
- Dollar net retention rate remained flat at 99%, indicating no improvement in customer retention or expansion.
- The company expects operating margins to decline slightly in the second half of the year due to investments in IAM launch and rollout.
- Headcount increased quarter-over-quarter, reflecting a measured approach to hiring, but still showing a 2% decrease year-over-year.
- The guidance for Q3 and fiscal year 2025 indicates only a 6-7% year-over-year increase in revenue, suggesting modest growth expectations.
Good afternoon, ladies and gentlemen, and thank you for joining Docusign's second quarter fiscal year '25 earnings conference call. (Operator Instructions) As a reminder, this call is being recorded and will be available for replay from the Investor Relations section of the website following the call. (Operator Instructions)
I will now pass the call over to Heather Harwood, Head of Investor Relations. Please go ahead.
Thank you, operator. Good afternoon, and welcome to Docusign's Q2 fiscal 2025 earnings call. Joining me on today's call are Docusign's CEO, Allan Thygesen; and CFO, Blake Grayson. The press release announcing our second quarter fiscal 2025 results was issued earlier today and is posted on our Investor Relations website, as well as the published version of our prepared remarks.
Before we begin, let me remind everyone that some of the statements on today's call are forward-looking. We believe our assumptions and expectations related to these forward-looking statements are reasonable, but
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