DocuSign Inc. (DOCU) shares tumbled in Friday trading, proving once again that beating quarterly numbers doesn't always matter if your forward outlook disappoints.

The electronic signature company reported third-quarter revenue of $818 million, up 8.4% year-over-year and ahead of analyst expectations. But the guidance for the current quarter told a less cheerful story, and investors responded accordingly.

What the Analysts Are Saying

JPMorgan analyst Mark Murphy kept his Neutral rating while trimming his price target from $80 to $78. Meanwhile, Needham analyst Scott Berg stuck with his Hold rating on the stock.

Murphy noted that billings climbed 10.3% year-over-year to $829 million, but the drivers of that growth raised some eyebrows. The upside came from stronger-than-expected early renewals, favorable renewal timing, a modest shift toward annual billing, and slight foreign exchange tailwinds. In other words, some of the good news was about timing rather than pure organic momentum.

Customer growth looked decent at first glance: total customers rose 9.2% year-over-year, up from 8.7% last quarter. Enterprise and Commercial customers increased 7.8% to 276,000, a modest acceleration from 7.1% in the prior quarter.

But here's the problem: management guided fourth-quarter revenue to $827 million at the midpoint, which implies sequential deceleration to roughly 6.5% year-over-year growth.

The Disappointment Factor

Berg from Needham pointed out that the revenue beat "was modestly disappointing" compared to the outperformance DocuSign delivered in the previous three quarters. Billings growth decelerated from 12.9% last quarter to 10.3% this quarter.

Strip out those early renewals, and billings grew only around 8%, Berg noted. The company raised its full-year billings guidance to $3,379-$3,389 million, implying 8.8% growth at the midpoint, but that incorporates "a lower assumption for early renewals and a cautious macro forecast."

Shares of DocuSign fell 6.23% to $66.67 on Friday.