DocuSign Inc. (NASDAQ: DOCU) has seen a significant surge in its stock price following the release of its third-quarter financial results, which exceeded market expectations. The electronic signature and agreement cloud company reported a robust performance, with both earnings and revenue surpassing analyst estimates, leading to a positive market reaction.

In the third quarter, DocuSign reported revenue of $754.8 million, which was above the consensus estimate of $745.26 million. The company's adjusted earnings per share came in at $0.90, beating the expected $0.87 per share. This performance marks an 8% year-over-year increase in total revenue, with subscription revenue also rising by 8% to $734.7 million. Additionally, professional services and other revenue grew by 11% to $20.1 million.

DocuSign's billings for the quarter were reported at $752.3 million, reflecting a 9% increase from the previous year. The company also generated a net cash flow from operating activities of $234.3 million and a free cash flow of $210.7 million. By the end of the quarter, DocuSign had $1.1 billion in cash, cash equivalents, restricted cash, and investments.

The company's CEO, Allan Thygesen, highlighted the strong performance and innovation in their Intelligent Agreement Management platform, which has been a key driver of growth. The early momentum of this platform has exceeded expectations, contributing to the company's strong revenue growth and operating profit.

Looking ahead, DocuSign has provided optimistic guidance for the fourth quarter and fiscal year 2025. The company expects fourth-quarter revenue to range between $758 million and $762 million, surpassing the market estimate of $755.95 million. For fiscal year 2025, DocuSign anticipates revenue between $2.959 billion and $2.963 billion, again exceeding analyst expectations.

Following the earnings announcement, DocuSign's stock rose by 17.11% in after-hours trading, reaching $98 per share. This positive market response reflects investor confidence in the company's future prospects and its ability to continue delivering strong financial results.

Overall, DocuSign's impressive third-quarter performance and optimistic future outlook have positioned the company well in the market, with analysts maintaining a Hold consensus rating on the stock. However, with the recent earnings beat, there is potential for revised analyst estimates in the near future.