UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________________________________

FORM 10-Q

______________________________________

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2024

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                 to                

Commission File Number: 001-38465

______________________________________

DOCUSIGN, INC.

(Exact name of registrant as specified in its charter)

______________________________________

Delaware			91-2183967
(State or Other Jurisdiction of Incorporation)			(I.R.S. Employer Identification Number)
221 Main St.	Suite 1550	San Francisco	California	94105
(Address of Principal Executive Offices) (Zip Code)

(415) 489-4940

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	DOCU	The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒    No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒    No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

☒	Large accelerated filer	☐	Accelerated filer
☐	Non-accelerated filer	☐	Smaller reporting company
		☐	Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ☐    No ☒

The registrant has 202,972,713 shares of common stock, par value $0.0001, outstanding at August 30, 2024.

DOCUSIGN, INC.

TABLE OF CONTENTS

	Note Regarding Forward-Looking Statements
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets as of July 31, 2024 and January 31, 2024	4
	Condensed Consolidated Statements of Operations and Comprehensive Income for the Three and Six Months Ended July 31, 2024 and 2023	5
	Condensed Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended July 31, 2024 and 2023	6
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended July 31, 2024 and 2023	8
	Notes to Condensed Consolidated Financial Statements	10
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4.	Controls and Procedures	39
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	41
Item 1A.	Risk Factors	42
Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	68
Item 5.	Other Information	69
Item 6.	Exhibits	69
	Exhibit Index	70
Signatures		71

Docusign, Inc. | 2025 Form 10-Q | 2

NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which statements involve substantial risk and uncertainties. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans, market growth and trends, our anticipated future products and product strategy, our objectives for future operations, and the impact of such assumptions on our financial condition and results of operations are forward-looking statements. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions.

Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about: our expectations regarding global macro-economic conditions, including the effects of inflation, volatile interest rates, and market volatility on the global economy; our ability to estimate the size and growth of our total addressable market; our ability to compete effectively in an evolving and competitive market; the impact of any data breaches, cyberattacks or other malicious activity on our technology systems; our ability to effectively sustain and manage our growth and future expenses and maintain or increase future profitability; our ability to attract new customers and maintain and expand our existing customer base; our ability to effectively implement and execute our restructuring plans; our ability to scale and update our platform to respond to customers’ needs and rapid technological change, including our ability to successfully incorporate generative artificial intelligence into our existing and future products; our ability to successfully execute our go-to-market and sales strategy for our IAM platform; our ability to expand use cases within existing customers and vertical solutions; our ability to expand our operations and increase adoption of our platform internationally; our ability to strengthen and foster our relationships with developers; our ability to retain our direct sales force, customer success team and strategic partnerships around the world; our ability to identify targets for and execute potential acquisitions and to successfully integrate and realize the anticipated benefits of such acquisitions; our ability to maintain, protect and enhance our brand; the sufficiency of our cash, cash equivalents and capital resources to satisfy our liquidity needs; limitations on us due to obligations we have under our credit facility or other indebtedness; our ability to realize the anticipated benefits of our stock repurchase program; our failure or the failure of our software to comply with applicable industry standards, laws and regulations; our ability to maintain, protect and enhance our intellectual property; our ability to successfully defend litigation against us; our ability to attract large organizations as users; our ability to maintain our corporate culture; our ability to offer high-quality customer support; our ability to hire, retain and motivate qualified personnel, including executive level management; our ability to successfully manage and integrate executive management transitions; uncertainties regarding the impact of general economic and market conditions, including as a result of regional and global conflicts; our ability to successfully implement and maintain new and existing information technology systems, including our ERP system; and our ability to maintain proper and effective internal controls.

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time. It is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. We cannot assure you that the results, events, and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements. The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which such statements are made. We undertake no obligation to update any forward-looking statements after the date of this Quarterly Report on Form 10-Q or to conform such statements to actual results or revised expectations, except as required by law.

Docusign, Inc. | 2025 Form 10-Q | 3

PART I - FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

DOCUSIGN, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(in thousands, except per share data)	July 31, 2024		January 31, 2024
Assets
Current assets
Cash and cash equivalents	$	619,064	$	797,060
Investments—current	319,289		248,402
Accounts receivable, net of allowance for doubtful accounts of $7,816 and $5,499 as of July 31, 2024 and January 31, 2024	309,885		439,299
Contract assets—current	13,449		15,922
Prepaid expenses and other current assets	81,693		66,984
Total current assets	1,343,380		1,567,667
Investments—noncurrent	102,537		121,977
Property and equipment, net	265,544		245,173
Operating lease right-of-use assets	117,877		123,188
Goodwill	455,519		353,138
Intangible assets, net	90,227		50,905
Deferred contract acquisition costs—noncurrent	427,599		409,627
Deferred tax assets—noncurrent	822,026		2,031
Other assets—noncurrent	129,232		97,584
Total assets	$	3,753,941	$	2,971,290
Liabilities and Equity
Current liabilities
Accounts payable	$	8,116	$	19,029
Accrued expenses and other current liabilities	93,251		104,037
Accrued compensation	178,603		195,266
Contract liabilities—current	1,307,565		1,320,059
Operating lease liabilities—current	19,769		22,230
Total current liabilities	1,607,304		1,660,621
Contract liabilities—noncurrent	23,020		21,980
Operating lease liabilities—noncurrent	115,832		120,823
Deferred tax liability—noncurrent	18,122		16,795
Other liabilities—noncurrent	28,257		21,332
Total liabilities	1,792,535		1,841,551
Commitments and contingencies (Note 9)
Stockholders’ equity
Preferred stock, $0.0001 par value; 10,000 shares authorized, 0 shares issued and outstanding as of July 31, 2024 and January 31, 2024	—		—
Common stock, $0.0001 par value; 500,000 shares authorized, 202,296 shares outstanding as of July 31, 2024; 500,000 shares authorized, 205,326 shares outstanding as of January 31, 2024	20		21
Treasury stock, at cost: 26 shares as of July 31, 2024; 18 shares as of January 31, 2024	(2,670)		(2,164)
Additional paid-in capital	3,087,650		2,821,461
Accumulated other comprehensive loss	(24,548)		(19,360)
Accumulated deficit	(1,099,046)		(1,670,219)
Total stockholders’ equity	1,961,406		1,129,739
Total liabilities and equity	$	3,753,941	$	2,971,290

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Docusign, Inc. | 2025 Form 10-Q | 4

DOCUSIGN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited)

	Three Months Ended July 31,				Six Months Ended July 31,
(in thousands, except per share data)	2024		2023		2024		2023
Revenue:
Subscription	$	717,366	$	669,367	$	1,408,849	$	1,308,674
Professional services and other	18,661		18,320		36,818		40,401
Total revenue	736,027		687,687		1,445,667		1,349,075
Cost of revenue:
Subscription	132,372		116,185		258,974		225,127
Professional services and other	23,093		29,397		45,937		56,942
Total cost of revenue	155,465		145,582		304,911		282,069
Gross profit	580,562		542,105		1,140,756		1,067,006
Operating expenses:
Sales and marketing	287,464		294,838		569,108		575,443
Research and development	147,571		135,960		281,891		251,324
General and administrative	87,129		103,884		179,607		208,695
Restructuring and other related charges	597		811		29,721		29,583
Total operating expenses	522,761		535,493		1,060,327		1,065,045
Income from operations	57,801		6,612		80,429		1,961
Interest expense	(544)		(1,592)		(688)		(3,558)
Interest income and other income, net	14,630		17,455		28,739		29,700
Income before provision for (benefit from) income taxes	71,887		22,475		108,480		28,103
Provision for (benefit from) income taxes	(816,324)		15,080		(813,491)		20,169
Net income	$	888,211	$	7,395	$	921,971	$	7,934
Net income per share attributable to common stockholders:
Basic	$	4.34	$	0.04	$	4.49	$	0.04
Diluted	$	4.26	$	0.04	$	4.40	$	0.04
Weighted-average shares used in computing net income per share:
Basic	204,604		203,703		205,231		203,177
Diluted	208,274		208,192		209,559		208,284
Comprehensive income:
Foreign currency translation gain (loss), net of tax	$	(1,017)	$	2,075	$	(5,318)	$	2,506
Unrealized gains on investments, net of tax	1,379		306		130		954
Other comprehensive income (loss)	362		2,381		(5,188)		3,460
Comprehensive income	$	888,573	$	9,776	$	916,783	$	11,394
Stock-based compensation expense included in costs and expenses:
Cost of revenue—subscription	$	15,593	$	13,081	$	29,774	$	24,438
Cost of revenue—professional services and other	4,998		7,286		9,700		14,016
Sales and marketing	58,778		51,563		105,049		96,889
Research and development	53,430		45,151		97,632		81,148
General and administrative	31,649		34,592		60,169		74,934
Restructuring and other related charges	208		34		4,836		4,988

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Docusign, Inc. | 2025 Form 10-Q | 5

DOCUSIGN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

	Common Stock			Additional Paid-In Capital		Treasury Stock		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders' Equity
(in thousands)	Shares	Amount
Balances at April 30, 2024	204,701	$	20	$	2,950,081	$	(2,670)	$	(24,910)	$	(1,785,521)	$	1,137,000
Exercise of stock options	29	—		455		—		—		—		455
Settlement of restricted stock units	2,141	—		—		—		—		—		—
Tax withholding on net share settlement of restricted stock units	(766)	—		(38,895)		—		—		—		(38,895)
Repurchases of common stock	(3,809)	—		—		—		—		(201,736)		(201,736)
Employee stock-based compensation	—	—		176,009		—		—		—		176,009
Net income	—	—		—		—		—		888,211		888,211
Other comprehensive income, net	—	—		—		—		362		—		362
Balances at July 31, 2024	202,296	$	20	$	3,087,650	$	(2,670)	$	(24,548)	$	(1,099,046)	$	1,961,406
Balances at April 30, 2023	202,359	$	20	$	2,412,033	$	(2,027)	$	(21,917)	$	(1,638,617)	$	749,492
Exercise of stock options	61	—		705		—		—		—		705
Settlement of restricted stock units	2,141	—		—		—		—		—		—
Tax withholding on net share settlement of restricted stock units	(780)	—		(42,026)		—		—		—		(42,026)
Repurchases of common stock	(584)	—		—		—		—		(30,008)		(30,008)
Employee stock-based compensation	—	—		159,820		—		—		—		159,820
Net income	—	—		—		—		—		7,395		7,395
Other comprehensive income, net	—	—		—		—		2,381		—		2,381
Balances at July 31, 2023	203,197	$	20	$	2,530,532	$	(2,027)	$	(19,536)	$	(1,661,230)	$	847,759

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Docusign, Inc. | 2025 Form 10-Q | 6

DOCUSIGN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) (Continued)

	Common Stock			Additional Paid-In Capital		Treasury Stock		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders' Equity
(in thousands)	Shares	Amount
Balances at January 31, 2024	205,326	$	21	$	2,821,461	$	(2,164)	$	(19,360)	$	(1,670,219)	$	1,129,739
Exercise of stock options	84	—		1,089		—		—		—		1,089
Settlement of restricted stock units	4,229	—		—		—		—		—		—
Tax withholding on net share settlement of restricted stock units and employee stock purchase plan	(1,562)	—		(83,740)		(506)		—		—		(84,246)
Employee stock purchase plan	564	—		20,190		—		—		—		20,190
Repurchases of common stock	(6,345)	(1)		—		—		—		(350,798)		(350,799)
Employee stock-based compensation	—	—		328,650		—		—		—		328,650
Net income	—	—		—		—		—		921,971		921,971
Other comprehensive loss, net	—	—		—		—		(5,188)		—		(5,188)
Balances at July 31, 2024	202,296	$	20	$	3,087,650	$	(2,670)	$	(24,548)	$	(1,099,046)	$	1,961,406
Balances at January 31, 2023	201,904	$	20	$	2,240,732	$	(1,785)	$	(22,996)	$	(1,598,684)	$	617,287
Exercise of stock options	76	—		832		—		—		—		832
Settlement of restricted stock units	3,285	—		—		—		—		—		—
Tax withholding on net share settlement of restricted stock units and employee stock purchase plan	(1,195)	—		(64,860)		(242)		—		—		(65,102)
Employee stock purchase plan	420	—		18,390		—		—		—		18,390
Repurchases of common stock	(1,293)	—		—		—		—		(70,480)		(70,480)
Settlement of capped calls, net of related costs	—	—		23,688		—		—		—		23,688
Employee stock-based compensation	—	—		311,750		—		—		—		311,750
Net income	—	—		—		—		—		7,934		7,934
Other comprehensive income, net	—	—		—		—		3,460		—		3,460
Balances at July 31, 2023	203,197	$	20	$	2,530,532	$	(2,027)	$	(19,536)	$	(1,661,230)	$	847,759

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Docusign, Inc. | 2025 Form 10-Q | 7

DOCUSIGN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

	Six Months Ended July 31,
(in thousands)	2024		2023
Cash flows from operating activities:
Net income	$	921,971	$	7,934
Adjustments to reconcile net income provided by operating activities:
Depreciation and amortization	51,528		48,105
Amortization of deferred contract acquisition and fulfillment costs	111,467		98,382
Amortization of debt discount and transaction costs	277		2,495
Non-cash operating lease costs	9,862		11,731
Stock-based compensation expense	307,160		296,413
Deferred income taxes	(824,561)		3,420
Other	5,323		(782)
Changes in operating assets and liabilities:
Accounts receivable	123,571		99,803
Prepaid expenses and other current assets	(17,067)		(14,420)
Deferred contract acquisition and fulfillment costs	(131,255)		(113,356)
Other assets	(15,058)		(8,433)
Accounts payable	(11,575)		(20,294)
Accrued expenses and other liabilities	(8,160)		10,164
Accrued compensation	(19,902)		(3,312)
Contract liabilities	(16,526)		40,458
Operating lease liabilities	(12,021)		(13,657)
Net cash provided by operating activities	475,034		444,651
Cash flows from investing activities:
Cash paid for acquisition, net of acquired cash	(143,611)		—
Purchases of marketable securities	(223,241)		(174,372)
Maturities of marketable securities	175,623		164,017
Purchases of strategic and other investments	(625)		(120)
Purchases of property and equipment	(45,033)		(46,436)
Net cash used in investing activities	(236,887)		(56,911)
Cash flows from financing activities:
Repurchases of common stock	(349,138)		(70,480)
Settlement of capped calls, net of related costs	—		23,688
Payment of tax withholding obligation on net RSU settlement and ESPP purchase	(81,083)		(62,681)
Proceeds from exercise of stock options	1,089		832
Proceeds from employee stock purchase plan	20,190		18,390
Net cash used in financing activities	(408,942)		(90,251)
Effect of foreign exchange on cash, cash equivalents and restricted cash	(2,677)		2,290
Net increase (decrease) in cash, cash equivalents and restricted cash	(173,472)		299,779
Cash, cash equivalents and restricted cash at beginning of period (1)	801,499		723,201
Cash, cash equivalents and restricted cash at end of period (1)	$	628,027	$	1,022,980

(1) $9.0 million and $4.4 million of restricted cash was included in Prepaid expenses and other current assets and Other assets—noncurrent at July 31, 2024 and January 31, 2024. $5.2 million and $1.3 million of restricted cash was included in Prepaid expenses and other current assets and in Other assets—noncurrent at July 31, 2023 and January 31, 2023.

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Docusign, Inc. | 2025 Form 10-Q | 8

DOCUSIGN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Continued)

	Six Months Ended July 31,
(in thousands)	2024		2023
Supplemental disclosure:
Cash paid for interest	$	—	$	93
Cash paid for operating lease liabilities	15,320		19,475
Cash paid for income taxes	13,207		6,090
Non-cash investing and financing activities:
Property and equipment in accounts payable and accrued expenses and other current liabilities	$	1,639	$	4,224
Operating lease right-of-use assets exchanged for lease obligations	4,707		—
Excise tax payable on net stock repurchase	1,660		—

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Docusign, Inc. | 2025 Form 10-Q | 9

DOCUSIGN, INC.

Index for Notes to the Condensed Consolidated Financial Statements

Note 1	Summary of Significant Accounting Policies	11
Note 2	Revenue	12
Note 3	Fair Value Measurements	13
Note 4	Property and Equipment, Net	14
Note 5	Acquisitions	14
Note 6	Goodwill and Intangible Assets, Net	16
Note 7	Deferred Contract Acquisition and Fulfillment Costs	17
Note 8	Debt	17
Note 9	Commitments and Contingencies	18
Note 10	Stockholders' Equity	20
Note 11	Restructuring and Other Related Charges	22
Note 12	Net Income Per Share Attributable to Common Stockholders	23
Note 13	Income Taxes	23

Docusign, Inc. | 2025 Form 10-Q | 10

DOCUSIGN, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Summary of Significant Accounting Policies

Organization and Description of Business

Docusign, Inc. (“we,” “our”, “us”, “Docusign”, or “Company”) was incorporated in the State of Washington in April 2003. We merged with and into Docusign, Inc., a Delaware corporation, in March 2015.

Docusign offers solutions that address agreement workflows and digital transformation. Docusign’s core offerings, including the world’s leading electronic signature and contract lifecycle management (“CLM”) products, allow organizations to boost productivity, accelerate contract review cycles, and transform agreement data into insights and actions while providing a better experience for their customers. Additionally, Docusign has introduced its Intelligent Agreement Management (“IAM”) platform, enabling organizations to create, commit to, and manage agreements, from virtually anywhere in the world, securely.

Basis of Presentation and Principles of Consolidation

Our condensed consolidated financial statements include those of Docusign, Inc. and our subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”) for interim financial information. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the applicable rules and regulations of the Securities and Exchange Commission (“SEC”). Therefore, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our fiscal 2024 Annual Report on Form 10-K.

Our condensed consolidated financial statements are unaudited and have been prepared on a basis consistent with that used to prepare the audited annual consolidated financial statements and, in our opinion, include all adjustments of a normal recurring nature necessary for the fair statement of our financial position, results of operations and cash flows. Our condensed consolidated balance sheet as of January 31, 2024 was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. The results of operations for the three and six months ended July 31, 2024 are not necessarily indicative of the results to be expected for the year ending January 31, 2025.

Our fiscal year ends on January 31. References to fiscal 2025, for example, are to the fiscal year ending January 31, 2025. Certain prior year amounts have been reclassified to conform to current year presentation. These amounts were not material to any of the prior periods presented.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions in the condensed consolidated financial statements and notes thereto.

Significant items subject to such estimates and assumptions made by management include, but are not limited to, the determination of:

•the fair value of intangible assets acquired in business combinations;

•the average period of benefit associated with deferred contract acquisition costs and fulfillment costs;

•the fair value of certain stock awards issued;

•the useful life and recoverability of long-lived assets;

•the discount rate used for operating leases;

•the recognition and measurement of loss contingencies; and

•the recognition, measurement and valuation of deferred income taxes.

Significant Accounting Policies

There have been no changes to our significant accounting policies described in our fiscal 2024 Annual Report on Form 10-K that have had a material impact on our condensed consolidated financial statements and related notes.

Docusign, Inc. | 2025 Form 10-Q | 11

Recent Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), which enhances disclosures required for operating segments. ASU 2023-07 expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. All disclosure requirements of ASU 2023-07 are required for entities with a single reportable segment. ASU 2023-07 is effective for annual filings for the Company’s fiscal year beginning February 1, 2024, and interim filings for the fiscal year beginning February 1, 2025, and should be applied on a retrospective basis to all periods presented. We are currently evaluating the effect of adopting ASU 2023-07 on our financial statement disclosures.

In December 2023, the FASB issued Accounting Standards Update 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), amending existing income tax disclosure guidance, primarily requiring more detailed disclosure for income taxes paid and the effective tax rate reconciliation. ASU 2023-09 is effective for annual reporting periods beginning after December 15, 2024, with early adoption permitted and can be applied on either a prospective or retrospective basis. We are currently evaluating the effect of adopting ASU 2023-09 on our income tax disclosures.

In March 2024, the SEC adopted the final rules under SEC Release No. 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors, which requires registrants to provide certain climate-related information in their registration statements and annual reports. As it pertains to the financial statements, the final rules require the financial statement footnotes to include certain disclosures regarding the amounts of expenses (or capitalized costs) incurred that relate to severe weather events and other natural conditions, as well as other disclosures regarding the material impact on financial estimates and assumptions of severe weather events and other natural conditions or disclosed targets or disclosed targets or transition plans. It also requires disclosure of financial statement amounts related to carbon offsets and renewable energy credits. The disclosure requirements will be phased in beginning with our annual filing for the fiscal year ending January 31, 2026. In April 2024, the SEC issued an order staying these rules pending the completion of judicial review of litigation challenging the validity of the rules. We are currently evaluating the disclosure impact of adoption of the standard on our consolidated financial statements.

We have not adopted accounting pronouncements during the three and six months ended July 31, 2024.

Note 2. Revenue

Subscription revenue is recognized over time and accounted for approximately 97% of our revenue in each of the three and six month periods ended July 31, 2024 and 2023.

Performance Obligations

As of July 31, 2024, the amount of the transaction price allocated to remaining performance obligations for contracts greater than one year was $2.2 billion. We expect to recognize 56% of the transaction price allocated to remaining performance obligations within the 12 months following July 31, 2024 in our condensed consolidated statement of operations and comprehensive income.

Contract Balances

Contract assets represent amounts for which we have recognized revenue, pursuant to our revenue recognition policy, for contracts that have not yet been invoiced to our customers where there is a remaining performance obligation, typically for multi-year arrangements. Total contract assets were $13.4 million and $15.9 million as of July 31, 2024 and January 31, 2024. The change in contract assets reflects the difference in timing between our satisfaction of remaining performance obligations and our contractual right to bill our customers.

Contract liabilities consist of deferred revenue and payments received in advance of performance under the contract. Such amounts are generally recognized as revenue over the contractual period. For the six months ended July 31, 2024 and 2023, we recognized revenue of $969.4 million and $876.0 million that was included in the corresponding contract liability balance at the beginning of the periods presented.

We receive payments from customers based upon contractual billing schedules. We record accounts receivable when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 days.

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Geographic Information

Revenue by geography is based on the address of the customer as specified in our master subscription agreements with our customers. Revenue by geographic area was as follows:

	Three Months Ended July 31,				Six Months Ended July 31,
(in thousands)	2024		2023		2024		2023
U.S.	$	529,452	$	507,984	$	1,042,178	$	1,001,042
International	206,575		179,703		403,489		348,033
Total revenue	$	736,027	$	687,687	$	1,445,667	$	1,349,075

Note 3. Fair Value Measurements

The following table summarizes our financial assets that are measured at fair value on a recurring basis:

	July 31, 2024
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Level 1:
Cash equivalents(1)
Money market funds	$	119,053	$	—	$	—	$	119,053
Level 2:
Cash equivalents(1)
Commercial paper	17,933		—		(4)		17,929
Available-for-sale securities
Commercial paper	87,595		3		(68)		87,530
Corporate notes and bonds	306,644		168		(436)		306,376
U.S. governmental securities	27,959		—		(39)		27,920
Level 2 total	440,131		171		(547)		439,755
Total	$	559,184	$	171	$	(547)	$	558,808
	January 31, 2024
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Level 1:
Cash equivalents(1)
Money market funds	$	298,517	$	—	$	—	$	298,517
Level 2:
Cash equivalents(1)
Commercial paper	43,845		—		(9)		43,836
U.S. government agency securities	9,968		—		(1)		9,967
Available-for-sale securities
Commercial paper	42,958		2		(25)		42,935
Corporate notes and bonds	299,166		262		(670)		298,758
U.S. governmental securities	28,752		—		(66)		28,686
Level 2 total	424,689		264		(771)		424,182
Total	$	723,206	$	264	$	(771)	$	722,699

(1) Included in “cash and cash equivalents” in our consolidated balance sheets as of July 31, 2024 and January 31, 2024, in addition to cash of $482.1 million and $444.8 million.

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We use quoted prices in active markets for identical assets to determine the fair value of our Level 1 investments. The fair value of our Level 2 investments is determined using pricing based on quoted market prices or alternative market observable inputs.

The fair values of our available-for-sale securities as of July 31, 2024, by remaining contractual maturities, were as follows (in thousands):

Due in one year or less	$	319,289
Due in one to two years	102,537
	$	421,826

As of July 31, 2024 and January 31, 2024, securities in an unrealized loss position were, individually and in aggregate, not material. An allowance for credit losses was deemed unnecessary for these securities, given the extent of the unrealized loss positions as well as the issuers' high credit ratings and consistent payment history.

We had no liabilities measured at fair value on a recurring basis as of July 31, 2024 and January 31, 2024.

Note 4. Property and Equipment, Net

Property and equipment, net consisted of the following:

(in thousands)	July 31, 2024		January 31, 2024
Computer and network equipment	$	142,253	$	142,241
Software, including capitalized software development costs	228,634		168,584
Furniture and office equipment	18,504		18,196
Leasehold improvements	62,930		58,230
	452,321		387,251
Less: Accumulated depreciation	(279,094)		(244,270)
	173,227		142,981
Work in progress	92,317		102,192
Total	$	265,544	$	245,173

Depreciation and amortization expense associated with property and equipment was $20.8 million and $20.3 million for the three months ended July 31, 2024 and 2023, and $40.6 million and $38.1 million for the six months ended July 31, 2024 and 2023. This included amortization expense related to capitalized internally developed software costs of $13.4 million and $8.8 million for the three months ended July 31, 2024 and 2023, and $25.1 million and $15.6 million for the six months ended July 31, 2024 and 2023.

For the three months ended July 31, 2024 and 2023, we capitalized $26.8 million and $22.2 million of internally developed software, including $9.1 million and $6.9 million of capitalized stock-based compensation expense in the three months ended July 31, 2024 and 2023. For the six months ended July 31, 2024 and 2023, we capitalized $51.5 million and $43.9 million of internally developed software, including $17.7 million and $13.7 million of capitalized stock-based compensation expense in the six months ended July 31, 2024 and 2023.

Note 5. Acquisitions

Acquisition of DocuSmart, Inc. d/b/a Lexion

On May 31, 2024 (“Acquisition Date”), we acquired 100% of the outstanding equity interests of Lexion, Inc. (“Lexion”), an AI-powered contract management platform which features intelligent contract repository and agreement workflow automation and reporting. We expect to integrate Lexion’s technology comprehensively across the Docusign IAM platform to better enable organizations to create, commit to, and manage agreements. The results of Lexion’s operations have been included in the accompanying consolidated financial statements since the Acquisition Date.

The acquisition purchase consideration, in accordance with ASC 805, totaled $154.0 million and was paid in cash. The Company paid $17.4 million of the consideration to an escrow account held for 18 months by a third party for post-closing indemnification obligations.

We accounted for the transaction as a business combination using the acquisition method of accounting. We allocated the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective estimated fair values on the Acquisition Date. Fair values were determined using the replacement cost

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method. Excess purchase price consideration was recorded as goodwill and is primarily attributable to the assembled workforce and expanded market opportunities when integrating Lexion’s intelligent contract repository and agreement workflow automation capabilities within Docusign’s IAM platform. The values assigned to the assets acquired and liabilities assumed are based on preliminary estimates of fair value available as of the date of this Quarterly Report on Form 10-Q. We continue to collect information with regards to our estimates and assumptions, including potential liabilities, contingencies, and the allocation of the purchase price. We will record adjustments to the fair value of the net assets acquired, liabilities assumed and goodwill within the measurement period, if necessary.

The following table summarizes preliminary allocation of purchase consideration to assets acquired and liabilities assumed based on their respective estimated fair values as of the date of acquisition:

(in thousands)	May 31, 2024
Cash and cash equivalents	$	10,409
Accounts receivable, net	1,741
Goodwill	103,352
Intangible assets, net	50,200
Contract liabilities — current	(5,071)
Deferred tax liability	(5,862)
Accrued expenses and other current liabilities	(749)
Total purchase consideration	$	154,020

None of the goodwill recognized upon acquisition is deductible for U.S. federal income tax purposes.

The estimated useful lives of intangible assets, primarily based on the expected period of benefit to us, and fair values of the identifiable intangible assets at Acquisition Date were as follows:

(in thousands, except years)	Estimated Fair Value		Expected Useful Life
Existing technology	$	29,900	5.0 years
Customer relationships—subscription	20,300		7.0 years
Total intangible assets	$	50,200	5.8 years

Additionally, the purchase agreement provides for $19.1 million of deferred compensation for key employees for which post acquisition employment service is required. The deferred compensation was paid into an escrow account at closing and recorded as prepaid asset that will amortize into compensation expense on a straight-line basis over the three year term of the arrangement.

We granted certain continuing employees and founders of Lexion restricted stock units (“RSUs”) with an aggregate grant date fair value of $34.8 million that will be accounted for as a post-acquisition compensation expense over the vesting period.

During the six months ended July 31, 2024, we incurred acquisition related expenses of $4.7 million which are recognized within general and administrative expenses in the consolidated statement of operations.

The following unaudited pro forma information has been prepared for illustrative purposes only and assumes the acquisition occurred on February 1, 2023. It includes pro forma adjustments related to the amortization of acquired intangible assets, share-based compensation expense, deferred compensation, and transaction related expenses. The impact of pro forma adjustments during the three and six months ended July 31, 2024 is not material. For the purpose of computing the pro forma tax effects of the acquisition, we applied the historical annual effective tax rate for the three and six months ended July 31, 2023 to the combined entity results. The unaudited pro forma results have been prepared based on estimates and assumptions, which we believe are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on February 1, 2023, or of future results of operations:

(in thousands) (unaudited)	Three Months Ended July 31,	Six Months Ended July 31,
	2023	2023
Net income/(loss)	4,082	2,117

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Note 6. Goodwill and Intangible Assets, Net

The changes in the carrying amount of goodwill were as follows (in thousands):

Balance at January 31, 2024	$	353,138
Additions—Lexion	103,352
Cumulative translation adjustment	(971)
Balance at July 31, 2024	$	455,519

Intangible assets consisted of the following:

	As of July 31, 2024							As of January 31, 2024
(in thousands, except years)	Weighted-average Remaining Useful Life (Years)	Acquisition-related Intangibles, Gross		Accumulated Amortization		Acquisition-related Intangibles, Net		Acquisition-related Intangibles, Gross		Accumulated Amortization		Acquisition-related Intangibles, Net
Existing technology	4.1	$	106,094	$	(70,913)	$	35,181	$	76,194	$	(65,777)	$	10,417
Customer contracts & related relationships	5.3	130,382		(66,689)		63,693		110,082		(60,947)		49,135
Other	0.0	22,534		(22,534)		—		22,534		(22,534)		—
	4.9	$	259,010	$	(160,136)	98,874		$	208,810	$	(149,258)	59,552
Cumulative translation adjustment						(8,647)						(8,647)
Total						$	90,227					$	50,905

Amortization of finite-lived intangible assets was as follows:

	Three Months Ended July 31,				Six Months Ended July 31,
(in thousands)	2024		2023		2024		2023
Cost of subscription revenue	$	3,067	$	2,314	$	5,137	$	4,717
Sales and marketing	3,113		2,630		5,742		5,259
Total	$	6,180	$	4,944	$	10,879	$	9,976

As of July 31, 2024, future amortization of finite-lived intangibles that will be recorded is estimated as follows, excluding cumulative translation adjustment:

Fiscal Period:	Amount (in thousands)
2025, remainder	$	13,839
2026	21,535
2027	19,398
2028	16,938
2029	13,191
Thereafter	13,973
Total	$	98,874

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Note 7. Deferred Contract Acquisition and Fulfillment Costs

The following table represents a rollforward of our deferred contract acquisition and fulfillment costs:

	Six Months Ended July 31,
(in thousands)	2024		2023
Deferred Contract Acquisition Costs:
Beginning balance	$	409,658	$	355,389
Additions to deferred contract acquisition costs	113,172		89,191
Amortization of deferred contract acquisition costs	(92,644)		(73,982)
Cumulative translation adjustment	(2,587)		2,113
Ending balance	$	427,599	$	372,711
Deferred Contract Fulfillment Costs:
Beginning balance	$	22,525	$	21,076
Additions to deferred contract fulfillment costs	18,083		24,165
Amortization of deferred contract fulfillment costs	(18,823)		(24,400)
Cumulative translation adjustment	14		139
Ending balance	$	21,799	$	20,980

Note 8. Debt

Convertible Senior Notes

In September 2018, we issued $575.0 million in aggregate principal amount of the 0.5% Convertible Senior Notes due in 2023 (“2023 Notes”). The net proceeds from the issuance of the 2023 Notes were $560.8 million after deducting the initial purchasers’ discounts and transaction costs.

In January 2021, we issued $690.0 million in aggregate principal amount of the 0% Convertible Senior Notes due in 2024 (“2024 Notes,” and together with the 2023 Notes, the “Notes”). The net proceeds from the issuance of the 2024 Notes were $677.3 million after deducting the initial purchasers’ discounts and transaction costs.

The 2023 Notes and 2024 Notes were extinguished, and all outstanding amounts were repaid in full during the third and fourth quarters of fiscal 2024, respectively. We repaid in cash $37.1 million and $689.9 million in aggregate principal amount of the 2023 Notes and 2024 Notes.

The effective interest rate on the 2023 Notes was 1.0%. The effective interest rate on the 2024 Notes was 0.6%. Interest expense recognized related to the Notes was as follows:

	Three Months Ended July 31,				Six Months Ended July 31,
(in thousands)	2024		2023		2024		2023
Contractual interest expense	$	—	$	46	$	—	$	403
Amortization of transaction costs	—		1,110		—		2,219
Total	$	—	$	1,156	$	—	$	2,622

Capped Calls

To minimize the potential economic dilution to our common stock upon conversion of the Notes, we entered into privately negotiated capped call transactions (“Capped Calls”) with certain counterparties. In the first quarter of fiscal 2024, we unwound $23.7 million of the Capped Calls in relation to our 2023 Notes and received cash from the counterparties. All remaining Capped Calls associated with the 2023 Notes and 2024 Notes expired during the third and fourth quarters of fiscal 2024, respectively.

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Impact on Net Income Per Share

In periods when we have net income, the shares of our common stock subject to the Notes outstanding during the period are included in our diluted earnings per share under the if-converted method. In the three months ended April 30, 2023, the Capped Calls were excluded from the calculation of diluted earnings per share, as they were antidilutive.

Revolving Credit Facility

In January 2021, we entered into a credit agreement, as subsequently amended in May 2023, with a syndicate of banks. The credit agreement extended a senior secured revolving credit facility (the “Credit Facility”) to us in an aggregate principal amount of $500.0 million, which amount may be increased by an additional $250.0 million subject to the terms of the credit agreement. We may use the proceeds of future borrowings under the credit facility to finance working capital, for capital expenditures and for other general corporate purposes, including permitted acquisitions.

The Credit Facility matures in January 2026 and requires us to comply with customary affirmative and negative covenants. We were in compliance with all covenants as of July 31, 2024. As of July 31, 2024, there were no outstanding borrowings under the Credit Facility. The Credit Facility is subject to customary fees for loan facilities of this type, including ongoing commitment fees at a rate between 0.25% and 0.30% per annum on the daily undrawn balance.

Note 9. Commitments and Contingencies

As of July 31, 2024, we had unused letters of credit outstanding totaling $0.6 million, the majority of which are associated with our various operating leases.

We have entered into certain noncancelable contractual arrangements that require future purchases of goods and services. These arrangements primarily relate to cloud infrastructure support and sales and marketing activities. As of July 31, 2024, our future noncancelable minimum payments due under these contractual obligations with a remaining term of more than one year were as follows:

Fiscal Period:	Amount (in thousands)
2025, remainder	$	18,631
2026	48,783
2027	10,588
2028	1,663
2029	1,138
Thereafter	483
Total	$	81,286

We entered into agreements with public cloud computing service providers with minimum commitments through fiscal 2027 and 2028. As of July 31, 2024 our remaining commitments under these agreements are $15.3 million and $102.1 million, respectively, which are excluded from the table above.

Indemnification

We enter into indemnification provisions under our agreements with customers and other companies in the ordinary course of business, including business partners, contractors and parties performing our research and development. Pursuant to these arrangements, we agree to indemnify and defend the indemnified party for certain claims and related losses suffered or incurred by the indemnified party from actual or threatened third-party claims because of our activities. The duration of these indemnification agreements is generally perpetual. The maximum potential amount of future payments we could be required to make under these indemnification clauses or agreements is not determinable. Historically, we have not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, we believe the fair value of these indemnification agreements is not material as of July 31, 2024, and January 31, 2024. We maintain commercial general liability insurance and product liability insurance to offset certain of our potential liabilities under these indemnification agreements.

We have entered into indemnification agreements with each of our directors, executive officers and certain other officers. These agreements require us to indemnify such individuals, to the fullest extent permitted by Delaware law, for certain liabilities to which they may become subject as a result of their affiliation with us.

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Claims and Litigation

From time to time, we may be subject to legal proceedings, claims, investigations or other contingencies in the ordinary course of business. If we are unsuccessful in defending, or if we determine to settle, any of these matters, we may be required to pay substantial sums, be subject to injunction and/or be required to change how we operates our business, which could have a material adverse impact on our financial position or results of operations.

Legal costs associated with litigation are expensed as incurred. Unless otherwise stated, we are unable to reasonably estimate the loss or a range of possible loss for the matters described below. In certain instances, we may be unable to determine that a loss is probable, or to reasonably estimate the amount of loss or a range of loss, for a claim because of the limited information available and the potential effects of future events and decisions by third parties, such as courts and regulators, that will determine the ultimate resolution of the claim. We review loss contingencies at least quarterly to determine whether the likelihood of loss has changed and whether we can make a reasonable estimate of the loss or range of loss. When we determine that a loss from a claim is probable and reasonably estimable, we record a liability for an estimated amount. We also provide disclosure when we determine it is reasonably possible that a loss may be incurred or when it is reasonably possible that the amount of a loss will exceed its recorded liability. Because these issues are often subject to substantial uncertainty, the probability of a loss (if any) and/or the estimated amount of a loss are difficult to ascertain. While it is not feasible to predict the outcome of all proceedings and exposures with certainty, we believe the final outcome of these matters, including the cases described below, will not have a material adverse effect on our business, consolidated financial position, results of operations or cash flows.

Docusign, Inc. Securities Litigation and Related Derivative Litigation

On February 8, 2022, a putative securities class action was filed in the U.S. District Court for the Northern District of California, captioned Weston v. Docusign, Inc., et al., Case No. 3:22-cv-00824, naming Docusign and certain of our then-current and former officers as defendants. An amended complaint was filed on July 8, 2022. As amended, the suit purports to allege claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder, based on allegedly false and misleading statements about our business and prospects during the course of the COVID-19 pandemic. As amended, the suit is purportedly brought on behalf of purchasers of our securities between June 4, 2020 and June 9, 2022. Our motion to dismiss the case at the pleading stage was denied by the U.S. District Court on April 18, 2023 and the suit is now proceeding.

An earlier action alleging similar claims against the same defendants, captioned Collins v. Docusign, Inc., et al., Case No. 3:22-cv-00851, filed in the Eastern District of New York and subsequently transferred to the Northern District of California, was voluntarily dismissed on February 14, 2022.

Eight putative shareholder derivative cases have been filed containing allegations based on or similar to those in the securities class action (Weston). The cases were filed on May 17, 2022, in the U.S. District Court for the District of Delaware, captioned Pottetti v. Springer, et al., Case No. 1:22-cv-00652; on May 19, 2022, in the U.S. District Court for the Northern District of California, captioned Lapin v. Springer, et al., Case No. 3:22-cv-02980; on May 20, 2022, in the U.S. District Court for the Northern District of California, captioned Votto v. Springer, et al., Case No. 3:22-cv-02987; on September 20, 2022, in the U.S. District Court for the Northern District of California, captioned Fox v. Springer, et al., Case No. 3:22-cv-05343; on March 7, 2024, in the Delaware Court of Chancery, captioned Roy v. Alhadeff, et al., Case No. C.A. 2024-0223-PAF; on April 9, 2024, in the U.S. District Court for the Northern District of California, captioned Alexander v. Springer, et al., Case No. 3:24-cv-02139; on April 11, 2024, in the Delaware Court of Chancery, captioned Ingrao v. Beer, et al., Case No. C.A. 2024-0382-PAF; and on May 28, 2024, in the Delaware Court of Chancery, captioned Jordan v. Springer, et al., Case No. C.A. 2024-0564-PAF. Each case is allegedly brought on the Company’s behalf. The suits name the Company as a nominal defendant and, depending on the particular case, the members of our board of directors or, in certain instances, then-current or former officers, as defendants. While the complaints vary, they are based largely on the same underlying allegations as the securities class action suit described above (Weston), as well as, in certain instances, alleged insider trading. Collectively, these lawsuits purport to assert claims for, among other things, breach of fiduciary duty, aiding and abetting such breach, corporate waste, gross mismanagement, unjust enrichment, and under Sections 10(b) and 21D of the Securities Exchange Act of 1934. The complaints seek to recover unspecified damages and other relief on the Company’s behalf. By court order dated July 19, 2022, the first two cases in the Northern District of California (Lapin and Votto) have been consolidated and stayed in light of the securities class action and no response to the complaints in the action will be due unless and until the stay is lifted. The third case in the Northern District of California (Fox) was related to the other derivative suits and assigned to the same judge, and was similarly stayed by order of the court on December 2, 2022. The most recent case in the Northern District of California (Alexander) was also related to the other derivative suits and assigned to the same judge, and subsequently consolidated with Lapin and Votto and stayed by order of the court on May 8, 2024. The Delaware suit (Pottetti) was voluntarily dismissed on September 1, 2022, and then re-filed in the Delaware Court of Chancery on September 22, 2022, under the caption Pottetti v. Springer, et al., Case No. C.A. 2022-0852-PAF. The Delaware Court of Chancery

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issued an order on September 30, 2022, staying the action in light of the securities class action. On May 28, 2024, plaintiff filed a notice seeking to voluntarily dismiss the Delaware Court of Chancery Pottetti action. On June 14, 2024, the plaintiff in Pottetti moved to voluntarily dismiss that action and the Court granted the dismissal on June 17, 2024. Similar to the prior stay in Pottetti, we anticipate the newly filed suits (Roy, Ingrao, and Jordan) will be consolidated and stayed in light of the securities class action, such that no response to the complaints would be due unless and until the stay is lifted.

Docusign Civil Litigation

On October 25, 2022, an action was filed in the Delaware Court of Chancery, captioned Daniel D. Springer v. Mary Agnes Wilderotter and Docusign, Inc., Civil Action No. 2022-0963-LWW, concerning Mr. Springer’s resignation from our board of directors. To avoid the cost and distraction of further litigation with Mr. Springer, we stipulated to entry of judgment in favor of Mr. Springer as to his disputed resignation and his status as a member of our board of directors. The Court of Chancery later dismissed the case.

In addition, on January 26, 2023, Mr. Springer delivered a demand for arbitration before JAMS, a private alternative dispute resolution firm, captioned Daniel D. Springer v. Docusign, Inc. and Mary Agnes Wilderotter. The demand alleged that Mr. Springer was wrongfully terminated as Chief Executive Officer; asserted related claims against Docusign and Ms. Wilderotter, including defamation, withholding promised compensation and breach of contract. The arbitration hearing for this case took place in March 2024.

On August 28, 2024, the arbitrator issued a final, non-appealable order which decided against Mr. Springer on all of his claims, and did not award him any relief. Docusign considers the matter closed.

Note 10. Stockholders' Equity

Equity Incentive Plans

We maintain three stock-based compensation plans: the 2018 Equity Incentive Plan (the “2018 Plan”), the Amended and Restated 2011 Equity Incentive Plan and the Amended and Restated 2003 Stock Plan.

As of July 31, 2024, 39.3 million shares of our common stock were available for issuance under the 2018 Plan.

Restricted Stock Units

RSU activity for the six months ended July 31, 2024 was as follows:

(in thousands, except per share data)	Number of Units	Weighted-Average Grant Date Fair Value
Unvested at January 31, 2024	26,700	$	60.70
Granted	10,403	57.84
Vested	(4,352)	71.83
Canceled	(2,256)	69.55
Unvested at July 31, 2024	30,495	$	57.28

As of July 31, 2024, our total unrecognized compensation cost related to RSUs was $1.3 billion. We expect to recognize this expense over the remaining weighted-average period of approximately 2.99 years.

As of July 31, 2024, the grant date fair value of unvested RSUs subject to market-based and performance-based vesting conditions (“PSU”) was $129.6 million. The number of RSUs granted or canceled included in the table above reflects shares that could be eligible to vest at 100% of target for PSUs and includes adjustments for over or under achievement for PSUs granted in prior periods.

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Stock Options

Option activity for the six months ended July 31, 2024 was as follows:

(in thousands, except years and per share data)	Number of Options	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding at January 31, 2024, all vested and exercisable	1,385	$	17.39	2.63	$	60,117
Exercised	(85)	12.86
Canceled/expired	(1)	13.43
Outstanding at July 31, 2024, all vested and exercisable	1,299	$	17.70	2.27	$	48,940

As of July 31, 2024, there was no remaining unrecognized compensation cost related to stock option grants.

Employee Stock Purchase Plan

The Employee Stock Purchase Plan (“ESPP”) allows eligible employees to purchase shares of our common stock at a discounted price, normally through payroll deductions, subject to the terms of the ESPP and applicable law. As of July 31, 2024, 12.1 million shares of our common stock were reserved for issuance under the ESPP.

Compensation expense related to the ESPP was $3.5 million and $4.5 million for the three months ended July 31, 2024 and 2023, respectively, and $6.6 million and $8.7 million for the six months ended July 31, 2024 and 2023, respectively.

Stock Repurchase Program

In March 2022, our board of directors authorized a stock repurchase program of up to $200.0 million of our outstanding common stock. Subsequently, in September 2023, our board of directors authorized an increase to our existing stock repurchase program for an additional amount of up to $300.0 million of our outstanding common stock. In May 2024, our board of directors authorized an increase to our existing stock repurchase program for an additional amount of up to $1.0 billion of our outstanding common stock.

During the three months ended July 31, 2024, we repurchased and canceled 3.8 million shares of common stock for an aggregate amount of $201.7 million. During the six months ended July 31, 2024, we repurchased and canceled 6.3 million shares of common stock for an aggregate amount of $350.8 million. The repurchase amount includes the 1% excise tax as a result of the Inflation Reduction Act (“IRA”).

During the three months ended July 31, 2023, we repurchased and canceled 0.6 million shares of common stock for an aggregate amount of $30.0 million. During the six months ended July 31, 2023, we repurchased and canceled 1.3 million shares of common stock for an aggregate amount of $70.5 million.

Docusign, Inc. | 2025 Form 10-Q | 21

Note 11. Restructuring and Other Related Charges

2024 Restructuring Plan

During the first quarter of fiscal 2024, our board of directors authorized a restructuring plan (the “2024 Restructuring Plan”) designed to support our growth, scale and profitability objectives. We incurred costs associated with the 2024 Restructuring Plan related to employee termination benefits and other costs mainly in the first quarter of fiscal 2024. As of the second quarter of fiscal 2024, the 2024 Restructuring Plan had been substantially completed.

2025 Restructuring Plan

During the first quarter of fiscal 2025, our board of directors authorized a restructuring plan (the “2025 Restructuring Plan”) designed to strengthen and support our financial and operational efficiency while continuing to invest in product and related initiatives. We incurred costs associated with the 2025 Restructuring Plan related to employee termination benefits and other costs mainly in the first quarter of fiscal 2025. As of the second quarter of fiscal 2025, the 2025 Restructuring Plan has been substantially completed.

These amounts are recorded to the Restructuring and other related charges within our consolidated statements of operations and comprehensive income as they are incurred.

For the three months ended July 31, 2024, restructuring and other related charges were $0.6 million for employee termination benefits. For the six months ended July 31, 2024, restructuring and other related charges were $29.7 million for employee termination benefits, which included stock-based compensation expense of $4.8 million. For the three months ended July 31, 2023, restructuring and other related charges were $0.8 million. For the six months ended July 31, 2023, restructuring and other related charges were $29.6 million, and primarily composed of $28.0 million for employee termination benefits, which included stock-based compensation expense of $5.0 million.

Restructuring liability activities during the six months ended July 31, 2024:

(in thousands)	January 31, 2024		Accruals		Cash Payments		July 31, 2024
2024 Restructuring Plan
Other	122		—		(122)		—
Total	$	122	$	—	$	(122)	$	—
2025 Restructuring Plan
Employee termination benefits	$	—	$	24,874	$	(24,276)	$	598
Total	$	—	$	24,874	$	(24,276)	$	598

Docusign, Inc. | 2025 Form 10-Q | 22

Note 12. Net Income per Share Attributable to Common Stockholders

The following table presents the calculation of basic and diluted net income per share attributable to common stockholders for periods presented:

	Three Months Ended July 31,				Six Months Ended July 31,
(in thousands, except per share data)	2024		2023		2024		2023
Numerator:
Net income attributable to common stockholders, basic	$	888,211	$	7,395	$	921,971	$	7,934
Add: Interest expense on convertible senior notes	—		46		—		403
Net income attributable to common stockholders, diluted	$	888,211	$	7,441	$	921,971	$	8,337
Denominator:
Weighted-average common shares outstanding, basic	204,604		203,703		205,231		203,177
Effect of dilutive securities	3,670		4,489		4,328		5,107
Weighted-average common shares outstanding, diluted	208,274		208,192		209,559		208,284
Net income per share attributable to common stockholders:
Basic	$	4.34	$	0.04	$	4.49	$	0.04
Diluted	$	4.26	$	0.04	$	4.40	$	0.04

Outstanding potentially dilutive securities that were excluded from the diluted per share calculations because they would have been antidilutive are as follows:

	Three Months Ended July 31,		Six Months Ended July 31,
(in thousands)	2024	2023	2024	2023
RSUs	8,924	16,028	6,188	7,190
ESPP	443	456	274	289
Total antidilutive securities	9,367	16,484	6,462	7,479

Note 13. Income Taxes

Our tax provision or benefit from income taxes for interim periods is determined using an estimate of our annual effective tax rate as prescribed under Accounting Standards Codification (“ASC”) 740, “Income Taxes”, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment, which results in a provision or benefit from income taxes in current or subsequent quarters.

Our income tax (benefit) / provision was $(816.3) million) and $15.1 million for the three months ended July 31, 2024 and 2023, respectively. Our income tax (benefit) / provision was $(813.5) million and $20.2 million for the six months ended July 31, 2024 and 2023, respectively.

We regularly assess the need for a valuation allowance on our deferred tax assets. In making this assessment, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more likely than not that some or all the deferred tax assets will not be realized. As of July 31, 2024, based on all available positive and negative evidence, having demonstrated sustained U.S. profitability which is objective and verifiable, and taking into account anticipated future earnings, we have concluded it is more likely than not that our U.S. federal and states deferred tax assets will be realizable, with the exception of certain federal deferred tax assets subject to limitation on use and our California deferred tax assets. Our U.S. federal and state deferred tax assets largely consist of tax attribute carryforwards (including net operating losses and tax credits) and capitalized research expenditures, all of which are expected to be fully utilized in light of anticipated future earnings. We continue to maintain a valuation allowance against California deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criterion. We expect future research and development tax credit generation in California to exceed our ability to use the existing tax credits.

Docusign, Inc. | 2025 Form 10-Q | 23

When a change in valuation allowance is recognized during an interim period, the change in valuation allowance resulting from current year income is included in the annual effective tax rate and the release of valuation allowance supported by projections of future taxable income is recorded as a discrete tax benefit in the interim period. We released $837.7 million of our valuation allowance as a discrete tax benefit during the three and six months ended July 31, 2024. We will continue to monitor the need for a valuation allowance against our deferred tax assets on a quarterly basis.

As of July 31, 2024, our gross unrecognized tax benefits totaled $71.2 million, excluding related accrued interest and penalties, of which $58.8 million would impact the effective tax rate if recognized. Our policy is to account for interest and penalties related to uncertain tax positions as a component of income tax provision. We do not expect material changes to our gross unrecognized tax benefits within the next 12 months.

Docusign, Inc. | 2025 Form 10-Q | 24

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements included in our fiscal 2024 Annual Report on Form 10-K. As discussed in the section titled “Note Regarding Forward-Looking Statements,” the following discussion and analysis contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those identified below and those discussed in the section titled “Risk Factors” under Part II, Item 1A in this Quarterly Report on Form 10-Q and in our fiscal 2024 Annual Report on Form 10-K. Our fiscal year ends January 31.

Executive Overview of Second Quarter Results

Overview

Docusign offers solutions that address agreement workflows and digital transformation. Docusign’s core offerings, including the world’s leading electronic signature and CLM products, allow organizations to boost productivity, accelerate contract review cycles, and transform agreement data into insights and actions, while providing a better experience for their customers. Additionally, Docusign has introduced its IAM platform, enabling organizations to create, commit to, and manage agreements, from virtually anywhere in the world, securely. As a result, approximately 1.6 million customers and more than a billion users worldwide utilize our platform to accelerate and simplify the process of doing business.

Historically, we have primarily offered access to our products on a subscription basis with prices based on the functionality our customers require and the quantity of Envelopes required by our customers. Similar to the physical envelopes historically used to mail paper documents, an Envelope is a digital container used to send one or more documents for signature or approval to one or more recipients. Our customers have the flexibility to put a large number of documents in an Envelope. For a number of use cases, such as buying a home, multiple Envelopes are used over the course of the process. To drive customer reach and adoption, we also offer for free certain limited-time or feature-constrained versions of our platform.

In addition, we have begun offering our new IAM platform on a user-based subscription basis. The subscription offerings have multiple pricing tiers as well as specialized packages for specific user personas and end markets beginning with sales and customer experience. The rollout of the platform and additional pricing model began gradually in certain customer segments and geographies starting in the second quarter of fiscal 2025, and we plan to continue the platform rollout across additional segments and geographies. As a result, we currently expect eSignature to continue to represent the majority of our revenue for the foreseeable future.

We generate substantially all our revenue from sales of subscriptions, which accounted for 97% of our revenue in each of the three and six month periods ended July 31, 2024 and 2023. Our subscription fees include the use of our products and access to customer support. Subscriptions generally range from one to three years, and substantially all our multi-year customers pay in annual installments, one year in advance.

We also generate revenue from professional and other non-subscription services, which consists primarily of fees associated with providing new customers deployment and integration services. Other revenue includes amounts derived from sales of on-premises solutions. Professional services and other revenue accounted for the remainder of total revenue in each of the three and six months ended July 31, 2024 and 2023. We anticipate continuing to invest in customer success through our professional services offerings as we believe it plays an important role in accelerating our customers’ adoption of our products, which helps drive customer retention and expansion.

We are highly focused on continuing to acquire new customers to support our long-term growth. We have invested, and expect to continue to invest in our go-to-market efforts involving an omnichannel approach that consists of direct sales, partner-assisted sales and digital self-service purchasing. As of July 31, 2024, we had a total of approximately 1.6 million customers, including approximately 253,000 enterprise and commercial customers, compared to over 1.4 million customers and approximately 226,000 enterprise and commercial customers as of July 31, 2023. We define a customer as a separate and distinct buying entity, such as a company, an educational or government institution, or a distinct business unit of a large company that has an active contract to access our products.

Docusign, Inc. | 2025 Form 10-Q | 25

We offer subscriptions to our products to businesses at all scales, from global enterprise down to local, very small businesses (“VSBs”). We have an omnichannel go-to-market approach that consists of direct sales, partners to sell to our customers, and digital self-serve. We offer more than 900 active partner integrations with the applications that many of our customers already use so that they can create, commit and manage agreements directly within these applications. We have a diverse customer base spanning across virtually all industries and around the world with no significant customer concentration. No single customer accounted for more than 10% of total revenue in any of the periods presented.

We focused initially on selling our products to commercial businesses and VSBs and later expanded our focus to target enterprise customers. The number of our customers with greater than $300,000 in annualized contract value was 1,066 customers as of July 31, 2024 compared to 1,047 customers as of July 31, 2023. Each of our customer types has a different purchasing pattern. VSBs typically become customers by quickly utilizing our digital and self-serve channels and generate smaller average contract values, while commercial and enterprise customers typically involve longer sales cycles, larger contract values and greater expansion opportunities for us.

Financial Results for the Three and Six Months Ended July 31, 2024 and 2023

	Three Months Ended July 31,				Six Months Ended July 31,
(in thousands)	2024		2023		2024		2023
Total revenue	$	736,027	$	687,687	$	1,445,667	$	1,349,075
Total costs and expenses	678,226		681,075		1,365,238		1,347,114
Total stock-based compensation expense	164,656		151,707		307,160		296,413
Income from operations	57,801		6,612		80,429		1,961
Net income	888,211		7,395		921,971		7,934
Net cash provided by operating activities	220,208		211,016		475,034		444,651
Purchases of property and equipment	(22,280)		(27,379)		(45,033)		(46,436)

Cash, cash equivalents, restricted cash and investments were $1.0 billion as of July 31, 2024.

Key Factors Affecting Our Performance

We believe that our future performance will depend on many factors, including the following:

Investing for Growth

We believe that our market opportunity is large, and we plan to invest to support long-term growth. This includes optimizing our omnichannel go-to-market opportunities to target attractive growth opportunities balanced with a more efficient go-to-market cost structure, accelerating product innovation through the continued investment in research and development, and enhancing operational and financial efficiency to scale effectively. Additionally, we continue to evaluate strategic acquisitions and investments. By focusing on infrastructure and technology that best serve our diverse customer base, we are prioritizing initiatives that not only enhance our product capabilities but also expand our product solutions.

We believe these combined efforts will strengthen our ability to retain and grow within our existing customer base, while also attracting new customers.

Growing Customer Base

We believe that our ability to increase the number of customers using our products, particularly the number of enterprise and commercial customers, is an indicator of our market penetration, the growth of our business and our potential future business opportunities. By increasing awareness of our products, further developing our sales and marketing expertise and continuing to build features tuned to different industry needs, we have expanded the diversity of our customer base to include organizations of all sizes across nearly every industry.

Docusign, Inc. | 2025 Form 10-Q | 26

Retaining and Expanding Contracts with Existing Enterprise and Commercial Customers

Many of our customers have increased spend with us as they have expanded their use of our offerings in both existing and new use cases across their front or back office operations. Our enterprise and commercial customers may start with just one use case and gradually implement additional use cases across their organization once they see the benefits of our products. Several of our largest enterprise customers have deployed our software platform for hundreds of use cases across their organizations. We believe there is significant expansion opportunity with our customers following their initial adoption of our software platform.

Increasing International Revenue

Our international revenue represented 28% of total revenue in each of the three and six months ended July 31, 2024 compared to 26% of total revenue in each of the three and six months ended July 31, 2023.

We started our international selling efforts in English-speaking common law countries, such as Canada, the UK and Australia, where we were able to leverage our core technologies due to similar approaches to electronic signature in these jurisdictions and the U.S. We have since made significant investments to be able to offer our products in select civil law countries. For example, in Europe, we offer Standards-Based Signature (“SBS”) technology tailored for the European Union’s (“EU”) electronic Identification, Authentication and Trust Services (“eIDAS”) regulations. SBS supports signatures that involve digital certificates, including those specified in the EU’s eIDAS regulations for advanced and qualified electronic signatures.

We believe there is a substantial opportunity for us to increase our international customer base by leveraging and expanding investments in our technology, direct sales force and strategic partnerships around the world, as well as helping existing U.S.-based customers manage agreements across their international businesses. We have experienced increased demand across multiple regions and are focusing our sales and marketing resources to capitalize on the potential growth of these markets. Additionally, we expect to continue to develop and enhance our strategic partnerships in key international markets as we grow internationally.

Components of Results of Operations

Revenue

We derive revenue primarily from the sale of subscriptions and, to a lesser extent, professional services.

Subscription Revenue

Subscription revenue consists of fees for the use of our software platform and our technical infrastructure and access to customer support, which includes phone or email support. We typically invoice customers annually in advance. We recognize subscription revenue ratably over the term of the contract subscription period beginning on the date access to our software platform is provided.

Professional Services and Other Revenue

Professional services revenue includes fees associated with new customers requesting deployment and integration services. We price professional services on a time and materials basis and on a fixed fee basis. We generally have standalone value for our professional services and recognize revenue based on standalone selling price as services are performed or upon completion of services for fixed fee contracts. Other revenue includes amounts derived from sales of on-premises solutions.

Overhead Allocation

We allocate shared overhead costs, such as facilities (including rent, utilities and depreciation on equipment shared by all departments), information technology, information security and recruiting costs to all departments based on headcount. As such, these allocated overhead costs are reflected in each cost of revenue and operating expense category.

Docusign, Inc. | 2025 Form 10-Q | 27

Cost of Revenue

Cost of Subscription Revenue

Cost of subscription revenue primarily consists of expenses related to hosting our software platform and providing support. These expenses consist of employee-related costs, including salaries, bonuses, benefits, stock-based compensation and other related costs associated with our technical infrastructure, customer success and customer support. These expenses also consist of software and maintenance costs, third-party hosting fees, outside services associated with the delivery of our subscription services, amortization expense associated with capitalized internal-use software and acquired intangible assets, credit card processing fees and allocated overhead costs.

Cost of Professional Services and Other Revenue

Cost of professional services and other revenue consists primarily of personnel costs for our professional services delivery team, travel-related costs and allocated overhead costs.

Gross Profit and Gross Margin

Gross profit is total revenue less total cost of revenue. Gross margin is gross profit expressed as a percentage of total revenue. We expect that gross profit and gross margin will continue to be affected by various factors including our pricing, timing and amount of investment to maintain or expand our hosting capability, the growth of our software platform support and professional services team, stock-based compensation expenses, amortization of costs associated with capitalized internal use software and acquired intangible assets and allocated overhead costs.

Operating Expenses

Our operating expenses consist of sales and marketing, research and development, general and administrative, and restructuring and other related charges. As our revenues continue to increase, our operating expenses as a percentage of revenue may increase or decrease at different rates, driven by the timing of revenue recognition, the timing of hiring, our investments in growth and other factors.

Sales and Marketing Expense	Sales and marketing expense consists primarily of personnel costs, including sales commissions. These expenses also include expenditures related to advertising, marketing, promotional events and brand awareness activities, as well as allocated overhead costs. We expect sales and marketing expense to continue to increase in absolute dollars as we enhance our product offerings and implement marketing strategies.
Research and Development Expense	Research and development expense consists primarily of personnel costs. These expenses also include non-personnel costs, such as subcontracting, consulting and professional fees for third-party development resources, as well as allocated overhead costs. Our research and development efforts focus on maintaining and enhancing existing functionality and adding new functionality. We expect research and development expense to increase in absolute dollars as we invest in the enhancement of our software platform.
General and Administrative Expense	General and administrative expense consists primarily of employee-related costs for those employees providing administrative services such as legal, human resources, information technology related to internal systems, accounting and finance. These expenses also include certain third-party consulting services, certain facilities costs, allocated overhead costs, and lease-related charges. We expect general and administrative expense to increase in absolute dollars to support the overall growth of our operations.
Restructuring and Other Related Charges	Restructuring and other related charges consist primarily of costs associated with restructuring plans approved by our board of directors. In connection with these restructuring actions or other exit actions, which were undertaken to improve operating margin and support our growth, scale and profitability objectives, we recognize costs related to termination benefits for former employees whose positions were eliminated, the write-off of facility-related balances, and other costs.

Interest Expense

In fiscal 2024, interest expense consisted primarily of contractual interest expense and amortization of debt issuance costs on our Notes. The Notes were extinguished during fiscal year 2024. In fiscal 2025, interest expense consists primarily of commitment fees on the undrawn balance of our revolving credit facility and the amortization of the associated issuance costs.

Docusign, Inc. | 2025 Form 10-Q | 28

Interest Income and Other Income, Net

Interest income and other income, net, consists primarily of interest earned on our cash, cash equivalents and investments, changes in fair value of our strategic investments and foreign currency transaction gains and losses.

Provision for (Benefit from) Income Taxes

Our income tax benefit consists primarily of the release of a $837.7 million valuation allowance related to our U.S. deferred tax assets. We regularly assess the need for a valuation allowance on our deferred tax assets. In making this assessment, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more likely than not that some or all the deferred tax assets will not be realized. As of July 31, 2024, based on all available positive and negative evidence, having demonstrated sustained U.S. profitability, which is objective and verifiable, and taking into account anticipated future earnings, we have concluded it is more likely than not that our U.S. federal and states deferred tax assets will be realizable, with the exception of certain federal deferred tax assets subject to limitation on use and our California deferred tax assets. We continue to maintain a valuation allowance against these deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the “more likely than not” realization criterion.

Docusign, Inc. | 2025 Form 10-Q | 29

Discussion of Results of Operations

The following table summarizes our historical consolidated statements of operations data:

	Three Months Ended July 31,								Six Months Ended July 31,
(in thousands, except percentages)	2024		As % of revenue		2023		As % of revenue		2024		As % of revenue		2023		As % of revenue
Revenue:
Subscription	$	717,366	97	%	$	669,367	97	%	$	1,408,849	97	%	$	1,308,674	97	%
Professional services and other	18,661		3		18,320		3		36,818		3		40,401		3
Total revenue	736,027		100		687,687		100		1,445,667		100		1,349,075		100
Cost of revenue:
Subscription	132,372		18		116,185		17		258,974		18		225,127		17
Professional services and other	23,093		3		29,397		4		45,937		3		56,942		4
Total cost of revenue	155,465		21		145,582		21		304,911		21		282,069		21
Gross profit	580,562		79		542,105		79		1,140,756		79		1,067,006		79
Operating expenses:
Sales and marketing	287,464		39		294,838		43		569,108		39		575,443		43
Research and development	147,571		20		135,960		20		281,891		20		251,324		19
General and administrative	87,129		12		103,884		15		179,607		12		208,695