Thank you for joining DocuSign's Third Quarter Fiscal Year 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. There will be a question and answer session. As a reminder, this call is being recorded and will be available for replay from the Investor Relations section of the website following the call. I will now pass the call over to Matt Sonefeldt, Head of Investor Relations. Please go ahead.

Thank you, operator. Good afternoon, and welcome to DocuSign's Q3 Fiscal 2026 Earnings Call. Joining me on today's call are DocuSign CEO, Allan C. Thygesen, and CFO, Blake Jeffrey Grayson. The press release announcing our third quarter fiscal 2026 results was issued earlier today and is posted on our Investor Relations website along with the published version of our prepared remarks. Before we begin, let me remind everyone that some of our statements on today's call are forward-looking, including any statements regarding future performance. We believe our assumptions and expectations related to these forward-looking statements are reasonable, but they are subject to known and unknown risks and uncertainties that may cause our actual results or performance to be materially different. In particular, our expectations regarding factors affecting customer demand and adoption are based on our best estimates at this time and are therefore subject to change. Please read and consider the risk factors in our filings with the SEC, together with the content of this call. Any forward-looking statements are based on our assumptions and expectations to date, and except as required by law, we assume no obligation to update these statements in light of future events or new information. During this call, we will present GAAP and non-GAAP financial measures. In addition, we provide non-GAAP weighted average share counts and information regarding free cash flows and billings. These non-GAAP measures are not intended to be considered in isolation from, a substitute for, or superior to our GAAP results. We encourage you to consider all measures when analyzing our performance. For information regarding our non-GAAP financial information, the most directly comparable GAAP measures, and a quantitative reconciliation of those figures, please refer to today's earnings press release, which can be found on our website at investor.docusign.com. I'd now like to turn the call over to Allan.

Thank you, Matt. Good afternoon, everyone. Q3 was a standout quarter for DocuSign. We delivered one of the higher growth quarters over the past two years, driven by continued customer investment in core products and the intelligent agreement management or IAM platform. Revenue was $818 million, up 8% year over year, and billings were $829 million, up 10% year over year. Our ongoing commitment to operational efficiency once again delivered strong profitability with a non-GAAP operating margin of 31%. Free cash flow grew 25% year over year to $263 million and a 32% margin, supporting $215 million in share repurchases, our largest quarterly buyback to date. We are executing effectively across our three strategic pillars: meeting growing demand for DocuSign IAM and eSignature with an improving go-to-market motion, maintaining the rapid pace of platform evolution and AI innovation, and driving greater operational efficiency. We remain focused on our long-term goal to deliver sustainable, profitable, double-digit growth. Let's start with our go-to-market motion, which has been instrumental in driving IAM growth across commercial and enterprise customer segments. By the end of Q3, more than 25,000 paying direct and digital customers had adopted IAM, up from more than 10,000 in April. We remain on pace for IAM to represent a low double-digit percentage of recurring revenue at year-end. We are also encouraged by the early strong retention rates in our first IAM renewal cohorts as well as the continued trend of IAM customers increasing their eSignature usage after moving to the IAM platform. IAM is a system of record that enables customers of all sizes to ingest a vast complex body of agreements into a single repository, build agreement workflows that operate at scale, and take action on high accuracy insights from agreement data. IAM builds on a track record of enterprise…

Thanks, Allan. Good afternoon, everyone. Q3 results demonstrated another quarter of resiliency, with consistent overall growth and IAM demand momentum. We also continue to generate strong operating profitability and cash flow and translated that performance into our single largest quarterly dollar buyback in the company's history. Total revenue was $818 million, up 8% year over year in Q3, and subscription revenue was $801 million, up 9% year over year. Revenue outperformance was driven by modest sales-driven strength. Q3 billings were $829 million, up 10% year over year. Revenue and billings had small foreign currency benefits of approximately 50 basis points year over year. Billings outperformance was primarily driven by two elements. The first was renewal timing and early renewal strength, which drove slightly more than half of the outperformance in Q3. Similar to Q2, we saw slightly earlier renewals than forecasted. Importantly, the quality of those early renewals continued to improve year over year as a percentage of early renewals with expansion grew, and the share of early renewals that were flat declined. The second element was a collection of smaller impacts, including a small shift in payment frequency to annual, bookings performance, and slight FX favorability. When removing the impact from timing relative to our forecast, billings growth for Q3 was approximately 8% year over year. As a reminder, we also saw elevated early renewal activity in 2025, creating a more difficult year-over-year billings comparison in Q3 and Q4 of this year. A consistent theme in our quarterly billings results has been that renewal timing can create significant variability in billings as a reporting metric. This quarter, we are previewing three future disclosure updates that will take effect in our Q4 2026 earnings call in March. These updates reflect investor feedback, and our primary goals are to provide better…

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, you may press star 2 if you would like to remove your question from the queue. Before pressing the star keys. Our first question comes from Jake Roberge with William Blair. You may proceed with your question.

Yeah. Thanks for taking the question, and nice to see the billing strength and continued expectation for that to accelerate this year. As you start to transition to ARR, should we expect that ARR seeing a fairly similar reacceleration that we are seeing with billings on a full-year basis, or would there be any puts or takes that we should be thinking about around that moving forward?

Sure. Yes. Thanks for the question, Jake. So we are not disclosing ARR yet. We will do that when we get to the March call. I think the way to think about it for us is what ARR is, as you heard us talk about, you know, billings growth excluding the beat, you know, from the earliest component as well, and that is, you know, a good proxy for trajectory for our business. But I think for us, we are really excited about the opportunity with both the combination of expansion opportunities with IAM and also with gross retention improvements in our core build as well, to really drive that ARR number forward for us, you know, in the FY '27 and then, you know, into beyond. But you will, we will talk more about that when we get to March.

Okay. Yeah. Maybe I should add. Quick to Oh, go ahead. Go ahead.

No. I was just gonna say that I want to emphasize that you know, we are running the business on ARR now. And so we wanted to move to a place where we are sharing with you how we run the business. And so that is the spirit of issues. Take this. I think it is the right long-term metric for the company, and we look forward to sharing that with you as we go forward.

That is helpful. And then great to see IAM crossing that 25,000 customer mark. Could you talk more about what you are seeing with the early renewal cohorts? Sounds like retention has been strong, but for customers that may have initially started with only a portion of their base on IAM, are you starting to see those customers shift to broader and wider IAM deployments on renewal? Thanks.

Yeah. Overall, I think we are pleased with the early signs. As a reminder, we launched IAM back in June of last year to commercial customers in North America and Australia. And so those are the cohorts that are renewing now, and then we launched internationally and enterprise towards the latter end of the year part of last year. The early signs are very promising. They renew at higher rates than our traditional sign business. So you know, we obviously will keep a close eye on that. And in terms of the expansion, I have anything beyond that to say, but, you know, as we you will see that baked into, you know, our projections going forward on ARR. Obviously, we are optimistic that IAM will progress very nicely in companies over time. The smaller companies do not have as much expansion opportunity. When you get to larger companies, you are deploying an individual department or division, then those expansion opportunities are larger. But overall, I think we feel really good both about the initial sale and about the adoption and the follow-on.

Our next question comes from Tyler Radke with Citi. You may proceed with your question.

Yes. Hi. Thanks for taking my question. Obviously, great momentum on the IAM side. 25,000 customers. You know, the Navigator product in particular, great to see the, you know, the volume of agreements there. I guess, bigger picture question for you, Allan, like, how do you think about what the use cases and future monetization opportunity is as that volume of agreements continues to grow within Navigator? Like, what are they gonna be using it for a year or two from now, and what are the ways that DocuSign can monetize over the long run?

Yeah. A couple of points I would say. First of all, navigating sort of a foundation capability for our IAM platform. Right? And so many things roll off of having that intelligent repository. You know, as an example, you can run things like obligation management and a variety of extractions on top of that. You can have automated notifications. The agents can run off that. And so it really is a foundational capability that is embedded in the platform. It is not like we monetize Navigator separately. It is an integral part of IAM. We are feeling, I think, that that is a significant and distinctive proprietary advantage for DocuSign. So there is a lot of noise in the ecosystem about LLM models, and we obviously have benefited tremendously from the enormous CapEx investment and capability enhancement that has happened in the LLM space over the last two and a half years. Very grateful to be leading DocuSign through that. But on top of that, we get to train on proprietary consent to, you know, private agreements from companies that are not publicly available. And so we can achieve higher accuracy rates with that. If you take that, compound it with our workflow advantage and our trust and reputation advantages, it all sets up really nicely for us, and Navigator is foundational to that. But we do not monetize it as part of the platform, not independently. If that makes sense.

Yeah. That is helpful. And, follow-up for Blake. You know, good to see the billings upside this quarter, and I think trailing twelve-month billings accelerated. As we look at the subscription revenue guide for Q4, the growth is a little bit below where you guided Q3. And I guess just given that you are going to be transitioning to ARR next quarter, how would you sort of characterize the underlying growth of the business? Has it been steady? Is it accelerating? Maybe you are just adding in a bit more prudence in Q4 because of the macro go-to-market changes. Just help us understand kind of the puts and takes on that. Thank you.

Sure. Yeah. So our revenue, we are, you know, we are obviously guiding to a Q4 revenue growth rate, which is a bit of a deceleration from Q3. Two primary things are driving that. And neither of them, I think, are that worrisome, which is one is, you know, Q3, we did have some extra early component hit us in Q3 in a good way. And you get a little bit of revenue acceleration from that. And then the other thing to remember is if you go back to Q4 of last year, we grew revenue at a pretty big we grew revenue '25 at 9%. And if you recall, there was a we launched a number of new features, especially on the PLG side and digital for it shorter term, you know, envelope add-ons and things like that, which we got that boost. Because from Q3 to Q4 last year, our revenue accelerated by over 100 basis points. And so I would just encourage make sure to look at that hard call that we have on a year-over-year basis because that does explain a bit of it when you think about a deceleration like that from Q3 to Q4.

Our next question comes from Mark Murphy with JPMorgan. You may proceed with your question.

Thank you so much, and congrats on a very nice performance. You had mentioned, I believe, consistent growth in Envelope sent, but you called out utilization rates reaching multiyear highs. And I am just wondering if there is any way to help us conceptualize that. You know, for instance, are the envelopes then growing mid-single digits? Are they growing high single digits? And then or any sense of where the utilization rates stand? And as part of that, should we read into this that customers are basically using more of what they paid for? And so it is going to foreshadow, you know, pretty healthy up and expansion ARR opportunity in, you know, in future periods, or is there some other kind of takeaway from that?

Sure. Let me take a stab, and Allan jump in. So yes, we do not break out like the envelope sent growth by vertical and plus that. But what I would say is it has been very, very consistent for us. And I will talk about envelopes first, then we can talk about utilization after that. On the envelope sent, you know, the past five quarters or so, we have seen very consistent growth year over year in envelopes sent, which is great. It goes to the point that we have seen what makes me so excited about the resiliency of this business. On the utilization side, so like consumption, it is higher than our prior year. And I think for us, it is a factor of timing. Right? So if somebody is using and I am making these numbers up. So but if, you know, if they are using 80% of their deal and it rises to 85%, that is always a good sign for us. Now the timing of the billing opportunity a new contract for them is subject to their business situation and their needs and all things like that. But I think all in for us as a company, as those utilization rates grow, I think they are only positive signs for us. And so I am really excited about it, but the timing of it is always subject to each individual customer situation.

Yeah. And I would just add, though, historically, that is obviously been a key performance measure for our side business, and we continue to keep a very close eye on it. Cellular certainly track it. But we now have a much broader portfolio of stuff to follow-up on. So as we build that momentum, with more envelope volume, better couple of utilization, we do not just go back to them and say, hey, would you like some more envelopes? We go to them and say, would you like to deploy newer green workflows? Would you like to consider this in other parts of the business? Would you like to learn what is in your all your agreements and make that information conveniently available in the apps that you care about? And that is just a much broader, you know, proposition and opportunity for upsell than we have historically had.

Okay. And then as a quick follow-up, I think you mentioned that the AI contract agents are in beta. Are you able to give any kind of sneak peek at what you are engineering there? What kind of usage scenarios? You are imagining? I think we are trying to figure out if you are going to target procurement sales workloads or take it broader. And then they review contracts or generate clauses, or is there some other kind of automation they are going to do? And if you are not able to speak to that now, I think we understand that as well. But I thought I would ask anyway.

Yeah. Well, I mean, we are launching several. They tend to be shall we say, relatively simple workflows as you would expect. You do not necessarily want to try to automate the most complex, highest variability workflows. They exist across sales and HR procurement use cases. So much like our IAM platform and Signature platform do. So we think that is probably as much as I should say at this time, but it gets early days. Right? We are just putting it out there. I think for all the noise, I think we are still in very early days of enterprise evaluations of these things. But we think it is inevitable that a number of contractual workflows will ultimately be automated with agents, and we want to be at the forefront of that. So that is why you are seeing us lean in. In the same vein, that is, of course, also why we are leaning in with a number of the chat platforms that would often be triggers for agentic action. And why they are so keen to partner with us. So we announced a partnership with an integration with OpenAI at our developer conference at the end of last month, and basically everybody else that matters in the space since then has reached out to us because agreements are an essential data site that touches so many different workflows inside of companies. And DocuSign is incredibly well positioned to provide that data to help with the automation agenda that many companies have. So, look, it is early days. But we are very excited about becoming a system of action for agreements.

Our next question comes from Kirk Materne with Evercore ISI. You may proceed with your question.

Yeah. Hi, guys. This is Peter Berkley on for Kirk. Appreciate you taking the question. You know, strong quarter in the large customer segment, that 300k plus ACV. Customer group, I think, was the strongest growth in eight or ten quarters. Just curious if you can discuss how much that is being driven by IAM adoption at the enterprise level versus just more broadly a stronger go-to motion at this point in time versus maybe a year ago. Thanks.

Yeah. It is both. So we continue to see strength, with customers who just expanding their eSignature usage. And at the same time, we are now starting to see some nice enterprise wins with IAM and both contribute nicely to the momentum in the 300k segment.

Helpful. Maybe just a quick follow-up on IAM. You know, IAM has been in the enterprise market for a few quarters now. Just curious if there are any learnings or any thoughts on the go-to-market playbook as you head into fiscal twenty seven.

Yeah. Look, it is still early days. I want to emphasize that that is a multiyear journey for us or indeed any company undertaking this transformation. We have made some really nice early wins, and it is nice to be able to see that continued progression. So we have got significant work going on on the innovation side in terms of scaling our enterprise feature set and access control extensibility, and then go-to-market side, as you asked. Key focus areas for next year include sort of complementing our traditional land and motion across departments with more of a top-down platform executive upsell. And, you know, we do that, but I think we can get better. We want to lean into both our ISB partnerships where we are already starting to see some nice progress and perhaps even more importantly, our system integrator partnerships. Historically, with DocuSign, that has been predominantly a CLM activity, but now it is literally the whole company is leaned in, and we are seeing a lot of inbound interest from the SI partners. And partnering with us because we have such a unique and broad proposition. And then lastly, on the pricing and packaging side, we have gotten questions on past calls. You will not be surprised to learn that, you know, as we move up from a lower friction model in the commercial space where simplicity is key to the enterprise, we are testing a more of a platform pricing model with tokens. Being very well received. And so I think you should expect to see us, you know, move in that direction more publicly. And that gives us just a lot more flexibility as we continue to layer in new capability and new value into IAM.

Very helpful. Thanks, Allan.

Our next question comes from Brent Thill with Jefferies. You may proceed with your question.

Allan, I know your long-term aspiration is double-digit growth. You are obviously knocking on the door, but what do you think it needs to take from here for you to continue to sustain or get to double-digit growth from your side? Are there a couple of ingredients that you think still have to trigger before you can hit that mark?

We are making really good progress. I am proud of the team. I think we look, the two big levers are what you would expect. It is retention. And we, you know, I think continue to make progress on that. I think there is still more headroom for us there. And it is, you know, new expansion bookings. And I think we are making progress there, particularly during IAM. And I am pretty confident those two levers will get us there. So we are working on it.

Okay. Blake, good to see the record buyback, I guess, may play devil's advocate. In the age of AI, why not lean a little harder into M&A, and is there anything you need to do to kind of help Allan's vision of that double-digit growth even if it is inorganic?

Yes, absolutely. It is something we talk about actively at DocuSign. It is a subject that on the outside, it may not sound, you know, like, because we do not do acquisition, you know, every quarter. But for us, it is something we talk about actively. We are looking for those companies and those assets that can help propel us forward, whether that is through elements of retention or expansion. Right? Us and I think that you know again we are super active about it. It is one of the reasons why we do keep the optionality on our balance sheet. Right, for those opportunities as they present themselves to us. We look at a lot. We have a high bar. For those acquisition conversations, but it is something that Allan and I the team I would say, actively talk about probably more than people think.

Yeah. Maybe just to add to that, First of all, I feel very good about our organic growth trajectory. And the innovation the scale and scope of the innovation that the teams are driving. So I think there is enough there. With that said, we have the resources. We have the go-to-market model. I think we want to explore strategically places where we think we can be additive. We like sound acquisition has been fantastic with DocuSign. It augmented our product roadmap both from a workflow and AI. In fact, the AgreementDesk product that we just launched this week was inspired by an earlier Lexan product and was led by the Lexion founders. And so it is very that has been a fantastic deal in every way, product, technology, team, and we inherited, you know, a good number of customers that have also performed very well. So overall, that was just excellent. If we can find more like that, we will, and we are looking. As you may know, there are things that are a little frothy right now.

I guess the message is that you just keep leaning in the buyback until you find something you like, and then you can balance since you can do both.

Yeah. I mean, we take capital allocation here really seriously, which is when we generate excess capital, we have opportunities to redeploy that. For right now, the buyback, we think, is a great opportunity to do that with the forward-looking outcomes that we think we can go after. At the same point in time, if we find those opportunities to deploy that capital, an M&A opportunity that helps do that for us as well, we will absolutely consider it. So capital allocation for us is a topic that Allan and I talk about quite often.

Great. Our next question comes from Scott Berg with Needham. You may proceed with your question.

Hi, everyone. Nice quarter. Just one question. For me and I know maybe this is a question for Allan, is on the AI contract agents, super interesting. I think legal contracts are one of the best use cases for these LLM technologies for all the probably inherent reasons we all know here on the call. But as we think about your customers and where they are and I guess awareness for agents and sure it is new to them and how we think about maybe budget procurement. Is this something that you think can have a meaningful impact on some of your momentum in fiscal twenty seven or is this more of a maybe a fiscal twenty eight opportunity as a test and trial next year and probably try to get some budgets after that?

I do not think it is a huge contributor to our financial momentum next year. But, you know, enterprise software is a multiyear roadmap endeavor, and people want to know they are with somebody who can deliver for them not just now, but years to come, and so it is very important to provide visibility to what they can do when they are ready, and I am doubt we will have a number of trials, but I do not think it will be financially meaningful. But it is certainly strategic.

Super helpful. Thanks for taking my question.

Our next question comes from Brad Sills with Bank of America. You may proceed with your question.

Oh, great. Thanks so much. Maybe a go-to-market question with regards to IAM. Allan, you talked about how you are seeing progress with HR in procurement departments. Is that the primary land you know, in the departmental sale in those two legal? I am just curious, you know, if the sales audience and the large enterprise really kind of centers around those three departments and, you know, curious how well prepared you feel the go-to-market is to address those?

Yeah. I would change the statement a little bit. I would say the four main use cases for us, sales, procurement, HR, and customer experience. We should think of that as sort of business-to-consumer type flows. Banking, onboarding, that kind of stuff. And we are seeing demand across all of those. I would say from a maturity perspective, you know, we have had a very strong position for a long time, and I would say sales and customer experience type applications. But there is a lot of interest now in procurement. And in HR. On the procurement side, these tend to be high dollar, low headcount, complex poorly supported, and I think that they are so eager to find solutions to achieve more efficiency in procurement processes and unlock value that is in agreements they have already negotiated. But on the HR side, that is, of course, essentially, those are business-to-consumer flows. Just on the hiring side as opposed to the selling side. And, you know, those are quite poorly integrated categories. And so a lot of the HR departments are very eager to see those processes streamlined. And we have a number of IC partnerships that we have announced here, even this quarter. That is something with Dayforce. We have done stuff with smart recruiters. We have done stuff with a lot of folks in the HR space that integrate DocuSign in to make the entire let us say, Canada onboarding process, for example, more efficient. So, look, those are the four big ones that you will see us talking about. And you will see us highlight at our conference in the spring. So one way maybe just to take a step back to think about the ongoing maturing of IAM when we first launched, we launched with a set of horizontal platform capabilities. Right? Navigator, being the most obvious example of the intelligent repository. This year, sort of completed that suite of agreement-related workflows with things like AgreementDesk. And next year, where we are going is fully integrated end-to-end functional workflow suites. That are polished and integrated with all the pieces and it will be those four. And so you can look forward to that. We are obviously already packaging that to some extent, but it will get tighter and better. And I think that is really those are the use cases that will and the departments and use cases that will empower the IAM growth.

That is great. That is great. Thanks, Allan. And maybe, Blake, one for you, if I could, please. Any observations on the macro? Any changes to the backdrop whether it is, you know, regards to, you know, envelope volumes or signings, there are some moving parts in the SMB right now, so just curious if you have seen any difference there between, you know, SMB commercial and enterprise. Your envelope and signing activity? Thank you.

Sure. You know, I would say there is nothing that we have seen in the business, you know, in Q3, and that has been pretty consistent for us over the past gosh, four or five quarters, I would say. I mean, consumption uses trends are consistent for us. We are seeing pretty strong year-over-year growth across most verticals. Now that said, companies are still scrutinizing spend and people, you know, sitting in my position at various companies want to make sure they are getting the most value they can from things. But you know, that is, I think, one of the big benefits of this the breadth of our customer base that we have is that just the consistent resiliency that we have seen is something that I have been really excited about, and you will see how the macro evolves over time. But to date, nothing really of any angst or concern out there that we have seen to date.

Great. Thank you, Blake.

Our next question comes from Josh Baer with Morgan Stanley. You may proceed with your question.

Hey, guys. This is Lucas Arasola on for Josh Baer. Thanks for the time and congrats on a great quarter. Could you give us some more color on the 25,000 IAM customers? Specifically, many are new to DocuSign versus existing eSign customers.

Yeah. So it is over 25,000 across our direct to digital business. It is predominantly direct, and they are the vast majority of them are existing eSign customers that upgrade to IAM. But we do onboard quite a few new customers directly onto IAM as well. But the vast majority is the installed base. Of course, that is the incredible advantage that we have. We have now almost 1.8 million customers that pay us monthly. Let us take the if we just look at the direct customer base, I think we are in the 270,000 or so active customers. That are serviced by our sales teams. We have so much headroom and yet come in with this huge advantage that we are already an approved vendor generally well-liked and trusted, often have many of their agreements. And so the step up to engage with us on IAM is far less than if we were a new vendor. So a lot of headroom left, but definitely driven predominantly by the installed base in part because, frankly, most companies are already our customers.

Got it. That is super helpful. And one more. Could you talk about hiring expectations for the year ahead? What should headcount growth look like? And what areas are you investing in aside from IAM and then within IAM? Thank you.

Yeah. I will go ahead and, Blake, you should jump in as well. Yeah. Look. We project quite modest headcount growth. We want to while we are very bullish on our growth opportunity, we also feel like we look we have got a lot of hard-fought efficiency gains in the company, and we want to hold on to those. Now you may see some reallocation within the company. There are areas including product and security where I think we want to continue investing disproportionately. But, you know, I do not anticipate our overall headcount to grow significantly. We are just being judicious investing carefully in the places that we think give us the most leverage over time.

Yeah. I would just say we are quite thoughtful about it. I think we have added, you know, over the past year, just over 200 net kind of headcount to DocuSign. So we are, you know, we are hiring across all of our locations. The vast majority, you know, those folks, we tended to add a little bit more in our lower-cost locations as well. So like Allan said, we are trying to be very methodical and very thoughtful about our hiring needs to make sure that we can support this business, but also we made a lot of hard choices to get to the efficiency gains that we have done over the past few years, and we are not just going to give those up either. And so I think that it is that balanced view that I think is the right path for us.

Thanks, guys.

Our next question comes from Patrick Walravens with Citizens. May proceed with your question.

Great. Appreciate you guys taking the questions here. This is Austin Cole on for Pat. Allan, you called out one of DocuSign's top 10 customers becoming the second-largest customer this quarter through IAM. I just wanted to give the opportunity if there is anything to call out on that expansion. It sounded pretty significant. What do they see in IAM, and is it kind of Navigator where they are getting most of the unlock? Or anything else there that would be helpful?

Yeah. Yes. It is Navigator, but it is Navigator plus. They are powering a lot of their pre-signature workflows with our Maestro and agreement type capabilities. And that, by the way, I think that is a more and more robust part of the offering. I mentioned AgreementDesk. We launched AgreementPrep, which is a whole system for creating templates and standard agreements that you can then deploy. Of course, it is a very common use case, you know, in the, let us say, a B2B sales context, for example. A vendor management context. And so I am feeling very bullish about the opportunity for expansion from our eSign base into IAM, and there are so many paths we can take with IAM. And that was just a great win. But there are a number of them. And, you know, I think some customers really go wall to wall. I mean, we mentioned ServiceTitan, I think, on the last call, and they are deploying us across a very broad set of functions. And, of course, that is we love that. Ultimately, we would love to be deployed across every function. I think that is our ultimate destiny as we fulfill our platform strategy.

Our next question comes from Alex Zukin with Wolfe Research. You may proceed with your question.

Hey, guys. Thanks for taking my question. Maybe just, two quick ones. If we think about the early renewal dynamic that you saw impact billings this quarter, kind of how much of that do you feel like was like, how much is IAM included in those early renewal conversations around the upsell dynamics specifically? And is that now kind of shifting more towards the installed base picking, you know, up that skew rather than just new customers? And I have a quick follow-up.

Sure. Let me take a stab at this. So you know, the vast majority of our early renewals is still, you know, our core business and our core product. We got a very large book of business that renews. Now IAM does play a role in some of those early renewals, and overall, what I really care about the most is that we are almost early renewals that we are spending the time with the folks that are expanding. Now expansion can come from IAM, obviously, but also can come from eSign. And we see that. And so I am super excited about just the definition of expansion in general. Now, of course, you know, I think that there is a lot of value that can come from IAM, and I think the customers over time are gonna see that value and want to adopt it over time as well. But and then also, you know, from an IAM and Allan mentioned this earlier, our install base is our primary target, right, for this. Like, we are signing up new customers, no doubt, right, for IAM. We have relationships with customers. They understand DocuSign. They trust DocuSign. They have their agreements with DocuSign. So it creates that opportunity for us, I think, that is a huge advantage for us that we can try to take it, you know, take leverage to be able to grow that business.

Perfect. And then maybe, Blake, just for you, a follow-up. And this is a little bit more nuanced on the billings. But if I looked at the delta between the implied, Q4 billings guide from kind of last quarter to this quarter. It looks like it went up from seven and a half percent to the new to 8%. So that half a point how much of that raise is truly operational outperformance versus kind of core FX and maybe other one-time non-core factors? And how should we think about underlying kind of run rate billings growth excluding early renewal timing or duration and FX, for Q4?

Yes. So relative to the full year, I think we raised the full-year guide on billings by about $44 million. So that is about $5 million more than the outperformance we had versus the midpoint in Q3. So we have taken some of that operational performance and floated through into Q4 and raised it off of what you are calling the implied subtracting fiscal, you know, the full year versus Q3 from our last quarter. So, you know, we are seeing improvements in the core side of the business. I think to your point about trying to manage around, okay, what is that underlying growth rate of billings, excluding early renewals and such as one of the reasons we are making these, you know, adjustments in FY '27 that we are talking about. I think one of the ways to think about it is if you look at Q3, like we just said, you know, about a 10% growth in billings, more like 8% excluding that early renewal component outperformance. I think that is the nature of it. I mean, in billings, early renewals will always be a part of our billings number. They will always represent a percentage of our billings. The question for us or as for as a team is what we think about and what is the health of the business is are we expanding? Those other renewals? And there are cases sometimes where you might do a flat one, but, you know, you want to make sure that you are spending your time in quarter for us on those. If you are gonna do it early, it is like, wow. This customer needs to have more demand. They are seeking that demand. How can we help them? Should we consider them for an IAM upgrade when we have those discussions? But, hopefully, that just helps level set it. But, again, timing of early renewals, it can be very volatile, and we have seen it happen every single quarter. So to try to get in that impact on a Q4 basis in a guide gets a little trickier. So hopefully, that Q3 description gives you some of the directional kind of look that you are I think you are looking for.

Perfect. Thank you, guys.

This now concludes our question and answer session. I would like to turn the call back over to Allan for closing comments.

Thank you, operator. Thank you to all who joined today's call. So in closing, I want to thank the entire DocuSign team for their commitment to putting our customers first and delivering on demand for better solutions to the agreement management problem. DocuSign's business is both resilient and at the leading edge of AI development. And we will continue to manage the company to realize our long-term potential. Thanks for your time, and we look forward to engaging with you next quarter.

Ladies and gentlemen, thank you for your participation. This concludes today's conference. Please disconnect your lines and have a wonderful day.