DocuSign Announces a 9% Workforce Reduction Plan

DocuSign, Inc. (NASDAQ:DOCU) announced a restructuring plan with a 9% workforce reduction, which equates to approximately 700 employees.

Analysts at RBC Capital lowered their price target to $55 from $65 following the announcement. On one hand, the analysts believe this likely gives investors comfort on margins, aligns with management's Q2 earnings call commentary, and makes sense given DocuSign likely over-hired during the pandemic. On the other hand, the analysts are perplexed by the focus on cost-cutting especially considering the already high churn in the sales org, the timing, and come away more cautious on near-term growth.