DocuSign (DOCU $75.41, -18.83%) shares plunged more than 18% on Friday morning, despite the company turning in better-than-expected Q1 earnings. The drop came as investors zeroed in on a weaker-than-anticipated billings figure, raising doubts about the company’s near-term momentum.

In the first quarter, DocuSign posted earnings per share of $0.90, well ahead of analysts’ forecast of $0.81, according to FactSet. Revenue clocked in at $763.7 million, beating both consensus estimates and the company’s own guidance range of $745 million to $749 million.

But the optimism was short-lived. Total billings—a crucial forward-looking metric that reflects current and future customer commitments—came in at $739 million, missing both Wall Street’s expectations and DocuSign’s own projected range of $741 million to $751 million.

The e-signature pioneer beat expectations on profit and revenue

That shortfall sparked new concerns about slowing demand for digital signature services in a broader environment where enterprise tech spending is cooling off.

“Our outlook for the full year had assumed some early renewal softness would hit billings later in fiscal 2026,” CEO Allan Thygesen explained during the earnings call. “Instead, that impact arrived earlier than planned, compressing Q1’s performance.” While Thygesen noted macro conditions didn’t materially affect Q1, he struck a cautious tone about the months ahead, citing ongoing economic uncertainty.

Looking ahead, the company forecast Q2 revenue between $777 million and $781 million—roughly in line with current expectations, but offering little reassurance to nervous investors.

Even with Friday’s sharp pullback, DocuSign’s stock is still up about 43% over the past year, reflecting how much ground the company has regained after previous stumbles. Still, this latest wobble shows that in a market hungry for future growth signals, even strong current results might not be enough.

For Tesla, perception has always been as powerful as performance.

Tesla’s valuation has long puzzled analysts focused on core metrics. Despite frequent stumbles in its vehicle delivery numbers and shrinking margins, the company’s stock has often moved as if untethered from its financials. As Levy points out, it often behaves more like a speculative asset—think Bitcoin—than a traditional automaker.

That’s because markets aren’t purely mathematical machines—investor sentiment, narratives, and charisma all have outsized influence. For Tesla, with roughly 30% of its shares held by retail investors, the stock trades heavily on emotional investment and story arcs, not just earnings reports.

Elon Musk has expertly played this game, using his massive online following and futuristic ambitions to keep Tesla in the spotlight and its valuation inflated. He’s cultivated a loyal base by merging moonshot ideas with occasional delivery on those promises, building what amounts to a market aura around the company.

But Musk’s deepening alignment with partisan politics—culminating in his visible ties to Trump—redefined Tesla’s appeal for many investors. After the 2024 election, Tesla’s value nearly doubled, becoming a proxy for bullish bets on a Trump-friendly administration.

Now, with that alliance seemingly fractured, the Tesla faithful may be left scrambling for a new storyline to rally behind. The question is whether the next chapter in Tesla’s saga can survive without Musk’s political magic.

More News

In a bold move, Barclays analyst Dan Levy stepped into the political and financial crossfire, releasing a note Friday dissecting the fallout from the explosive public spat between Elon Musk and former President Donald Trump—a rift that triggered a jaw-dropping $150 billion market cap plunge for Tesla (TSLA $294.08, -3.29%). Levy, who holds an “equal weight” rating on the stock, wrote:

“What we’re witnessing is more than a social media dust-up—it’s a disruption of the Tesla mythos, which was peaking in strength.

Let’s not forget: Tesla’s post-election surge was driven more by the buzz around Musk’s cozy rapport with Trump than the fundamentals.

The sell-off may seem outsized, but in light of how detached the stock has been from reality, it’s not surprising that a shift in optics could spark this kind of volatility.

We still lean slightly bearish. There’s risk that the much-hyped Robotaxi launch falls short. More importantly, investors haven’t fully priced in the weaker fundamentals and sluggish auto sales that are eventually bound to matter—even if they’re being ignored for now.”

Advertiser's disclosures:

¹ Mode Mobile recently received their ticker reservation with Nasdaq ($MODE), indicating an intent to IPO in the next 24 months. An intent to IPO is no guarantee that an actual IPO will occur.

² December 23, 2025 will be the last day to invest and be considered a shareholder in 2025. Any investments made after this date will only be considered shareholders starting in 2025.

³ Please read the offering circular and related risk at invest.modemobile.com. This is a paid advertisement for Mode Mobile’s Regulation A+ Offering.

Investing in private company securities is not suitable for all investors because it is highly speculative and involves a high degree of risk. It should only be considered a long-term investment. You must be prepared to withstand a total loss of your investment. Private company securities are also highly illiquid, and there is no guarantee that a market will develop for such securities.