Wall Street Gave Up, The Business Didn’t

Most people still think of Docusign as a digital signature tool. That’s a mistake, and it’s exactly the gap management is trying to exploit.

Over the last year, Docusign has rolled out its Intelligent Agreement Management platform, which aims to solve a much bigger and more expensive problem: what happens after a contract is signed.

According to Deloitte, companies lose roughly $2 trillion a year globally due to poor agreement management, missed renewals, unfavorable clauses, compliance failures, and manual processes that bury critical data inside PDFs. IAM is designed to surface that hidden value.

Key Points

• Its AI-driven IAM platform turns contracts into searchable, valuable assets, attacking a massive but overlooked agreement-management problem.

• The company has shifted from growth-at-all-costs to rising profitability, with strong GAAP and adjusted profit growth giving it strategic flexibility.

• Shares still price Docusign like a slow-growth software firm, leaving upside if IAM continues to gain traction and earnings scale.

The shift from e-signatures to agreement intelligence

One feature is Navigator, a centralized agreement repository that uses AI to extract and index key contract terms. Instead of legal or finance teams hunting through thousands of documents, they can search obligations, renewal dates, pricing escalators, and risk clauses in seconds. That’s how contracts are actually used as operating assets.

Maestro, another IAM component, removes friction earlier in the lifecycle. It lets teams design contract workflows without code, meaning sales, HR, procurement, and compliance can customize agreements without pulling engineering resources. That’s a subtle but powerful wedge into departments that historically avoided contract automation because it was too rigid.

Then there’s AI-Assisted Review, which flags risks and opportunities based on an organization’s own standards. Over time, these models become more valuable as they’re trained on a company’s specific language and negotiating patterns — a quiet form of stickiness that doesn’t show up in churn metrics right away.

The early adoption numbers are telling. As of October 31, more than 25,000 customers were using IAM, up 150% in just six months. Some customers report cutting agreement creation times by more than 90%, which translates directly into labor savings and faster deal cycles.

Profitability is no longer theoretical

Another misconception weighing on the stock is that Docusign can’t grow profitably.

A few years ago, management prioritized land-grab growth, pouring money into sales and marketing while margins collapsed. The strategy worked in terms of scale, but it left investors with a business that looked structurally unprofitable once growth slowed. Fast forward to today, and the financial profile looks very different.

Through the first three quarters of the fiscal year, adjusted profits are approaching $600 million. That kind of cash generation gives Docusign optionality, it can reinvest in growth, pursue tuck-in acquisitions, or simply let margins expand further.

What most investors miss is that IAM changes the margin equation. Agreement intelligence is higher value, more embedded, and harder to rip out than standalone e-signatures. If adoption continues, revenue quality improves even if headline growth remains modest.

Valuation reflects skepticism

Docusign trades at a steep discount to its historical average since going public. That multiple reflects lingering doubts about whether the company can ever reaccelerate growth.

On earnings, the picture is mixed. The stock trades at a higher P/E than the Nasdaq-100, which looks expensive at first glance. But that snapshot ignores trajectory. GAAP earnings are still early in their ramp, and growth north of 30% at the bottom line doesn’t usually last long without compressing valuation multiples.

In other words, the market is valuing Docusign like a mature, low-growth software company, while the business itself is in the middle of a product and margin transition. That disconnect is where opportunity often lives.