Shares of Adobe Inc. sank to their worst performance in more than 20 months Friday, after DocuSign Inc. delivered what some saw as a the latest sign of a demand cool-down for work-from-home software.
Chief Executive Dan Springer acknowledged Thursday that while his electronic-signature company saw “accelerated growth” for six quarters amid the pandemic, customers have gone back to “more normalized buying patterns.” As a result, DocuSign delivered a downbeat bookings outlook, sending its shares cratering more than 40%.
Some of that investor fear seemed to transfer over to Adobe
which also offers contract-management software and allows for the collection of e-signatures. Adobe’s stock fell 8.2% Friday, its steepest single-day percentage drop since March 2020 and the worst performance on the day from an S&P 500
stock. The move wiped away $26.3 billion in market capitalization, taking Adobe’s valuation lower than $300 billion.
The decline in Adobe shares struck Wedbush analyst Daniel Ives as a “DOCU-related selloff,” he told MarketWatch, as DocuSign’s report served as a “a barometer that the WFH tailwinds are now abating and could be a headwind for Adobe.”
“The DOCU print was a shocker and this is a knee-jerk reaction,” he said.
Subscribe: Want intel on all the news moving markets? Sign up for our daily Need to Know newsletter.
Adobe is due to post its own quarterly results Dec. 16. The company highlighted its e-signature technology in its prior earnings report, as Chief Financial Officer John Murphy noted that “third-quarter Document Cloud growth drivers included adoption of Sign in Acrobat driven by the increased need to collaborate in a hybrid work environment.”
While other at-home stocks took a hit on disappointing outlooks earlier in the course of the pandemic, DocuSign initially appeared more resilient. Its stock hit an all-time high in September and was up 165% since…