DocuSign Inc., the company that provides digital document signing tools for companies and people, saw its stock rise in after-hours trading today after reporting third-quarter financial results that blew past Wall Street’s expectations.

The company reported a profit before certain costs such as stock compensation of 22 cents per share on revenue of $382.92 million, up 54% from one year ago. That was way better than expected, with Wall Street having forecast earnings of just 10 cents per share on revenue of $361 million.

DocuSign sells tools that make it possible to sign documents electronically without meeting anyone face-to-face. It’s a capability that has proven extremely useful for businesses during the COVID-19 pandemic.

“As companies accelerate the digital transformation of their business and agreement processes, DocuSign’s role as an essential cloud platform continues to grow,” DocuSign Chief Executive Dan Springer (pictured) said in a statement. “Our Q3 results reflect that tailwind, as well as the immediate and long-term value that customers see from eSignature and our broader Agreement Cloud.”

The company saw its subscription revenue jump by 54% from a year ago, to $366.6 million. Meanwhile, its professional services revenue grew 43%, to $16.3 million.

Total billings came to $440.4 million, up 63% from a year ago. That’s an encouraging sign because the billings metric shows how much money the company is expected to collect over a specific time frame. As such, it’s considered to be a key indicator of business health.

DocuSign also reported a free cash flow of $38.1 million, compared to a negative free cash flow of $14.1 million one year ago.

The good times are expected to continue. For the fourth quarter, DocuSign is forecasting revenue in the range of $404 million to $408 million, well ahead of Wall Street’s predicted $387 million.

Investors showed their enthusiasm, as DocuSign’s stock gained 3% in after-hours trading.

Photo: DocuSign/Facebook