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Operator
Good afternoon, ladies and gentlemen. Thank you for joining DocuSign's fourth quarter and full year fiscal year 22 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. As a reminder, this call is being recorded and will be available for replay from the investor relations section of the website following the call. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. And I will now pass the call over to Roger Martin, Vice President of Finance. Please go ahead.
Roger Martin
Good afternoon and welcome to the DocuSign Q4 2020 earnings call. I'm Roger Martin, DocuSign's VP of Finance. Joining me on the call today are DocuSign CEO Dan Springer and our CFO, Cynthia Gaylor. The press release announcing our fourth quarter results was issued earlier today and is posted on our investor relations website. Now, let me remind everyone that some of our statements on today's call are forward looking. We believe our assumptions and expectations related to these forward looking statements are reasonable, but they are subject to known and unknown risks and uncertainties that may cause our actual results or performance to be materially different. In particular, our expectations regarding the pace of digital transformation and factors affecting customer demand, including as a result of the pandemic, are based on our best estimates at this time and are therefore subject to change. Please read and consider the risk factors in our filings with the SEC together with the content of this call. Any forward-looking statements are based on our assumptions and expectations to date and accept as required by law, we assume no obligation to update these statements in light of future events or new information. During this call, we will present GAAP and non-GAAP financial measures. Non-GAAP financial measures exclude stock-based compensation expenses, employer payroll tax on employee stock transactions, amortization of acquired intangible assets, amortization of debt discount and issuance costs from our notes, acquisition-related expenses, fair value adjustments to strategic investments, impairment of lease-related assets, and, as applicable, other special items. In addition, we provide non-GAAP weighted average share counts and information regarding free cash flows and billings. These non-GAAP measures are not intended to be considered in isolation from a substitute for or superior to our GAAP results. We encourage you to consider all measures when analyzing our performance. For information regarding our non-GAAP financial information, the most directly comparable gap measures, and a quantitative reconciliation of these figures, please refer to today's earnings press release, which can be found on our website at investor.docuSign.com. I'd like to turn the call over to Dan Springer. Dan?
Roger Martin
Thank you, Roger. Good afternoon, everyone. We have a lot to share with you today as we'll cover our performance for the quarter and for the entire fiscal year. We'll talk in more detail about some important sales wins and recent innovations that continue to bring our vision for the agreement cloud to life. Finally, we'll look ahead to our focus areas for fiscal 23. I'd like to start by sharing a few observations about the quarter. Q4 total revenue grew 35% year-over-year to $581 million with an 18% non-GAAP operating margin. Billings grew 25% year-over-year in the quarter. International revenue grew 55% year-over-year. We added nearly 60,000 new customers in the quarter, and that's a 31% increase year-over-year. And we continue to see strong net dollar retention of 119% in Q4, which is at the high end of our historical range. Looking at the year, we grew revenue 45% to over $2 billion, and billings by 37% to over $2.35 billion. we added more than 280,000 new customers, ending the year with over 1.17 million customers in total. These results reflect our team's unwavering dedication amid the macro challenges and the needed shifts in our business coming out of COVID. They also showcase continued tailwinds for the digitization of agreement workflows for businesses of every shape and size. We recognize, of course, that fiscal year 22 had two distinct chapters that contribute to our growth story. During the peak of the pandemic, urgent need drove dramatic acceleration of purchases, and our sales focus was squarely set on meeting that elevated demand. This motion carried through the first half of fiscal year 22. In the second half of the year, there were more challenging macro conditions impacting our customers' priorities. We saw a diminished level of urgency in their buying patterns. customers turned their focus to investments and projects that were delayed during the heart of the pandemic. As we saw urgent demand wane, we had just begun to shift in our sales motion back to a demand generation mode of cross-sell, up-sell, and departmental expansion. While we excelled at demand generation for many years pre-COVID, ultimately, the shift in customer buying patterns coming out of the pandemic was quicker than we anticipated, and we didn't move fast enough as an organization. Our move from capturing high volumes of customer demand to reverting back to generating demand is now well underway. We expect this work will continue through fiscal year 2023 as we make tangible progress moving through the year. At over $2 billion in annual revenue, we believe we're still very early in the first 10% of the $50 billion agreement cloud market opportunity. Digital transformation remains a high priority for businesses at every scale in every industry. Given our strong brand, leading market position, and product differentiation, DocuSign is uniquely positioned to lead and capture that market opportunity with eSignature and the broader agreement cloud. As the pandemic subsides and people begin to return to the office, they are not returning to paper. eSignature is clearly here to stay, and the movement toward the broader agreement cloud will only continue to gain prominence. We are confident we have massive market space to grow. When we think about the opportunity this year presents, it falls into two main buckets. The ways we're helping our customers succeed on our platform and the innovation we're bringing to market. Last quarter, we doubled down on our global go-to-market methodology and began driving our field org to focus on expanding opportunities. As our customers scale their usage across departments and new use cases, our field approach is also evolving. To that end, we've been bolstering our field leadership with strong leaders. with GMs in EMEA, APJ, and LATAM, along with recent additions across North America in the commercial and SMB segments. And we're very close to finalizing a new North American enterprise sales leader as well. Importantly, we've begun a search for an executive to lead the global field organization that's success and sales. This supports our goal of scaling our business to $5 billion and beyond. As part of this change, once we have secured and onboarded our new leader, Lauren will transition from DocuSign. Now, it's hard to think of a sales executive as having more impact on a company than Lauren has had here in his 14 years. From director to North American leader to CRO, he has really built the sales organization here. And as noted above, he's leading the way as we expand the sales leadership team for our next level of scale. He'll be staying with the company this year, and he remains focused on delivering for our customers and for driving our growth. Lorne will be a big part of helping us to transition to the new sales and success leader in the coming months. We're already encouraged from the results we're seeing from these efforts, as we are upselling eSignature to more departments and use cases, cross-selling our key add-ons like identity verification, notary, and monitor, as well as cross-selling our CLM products. For example, Last quarter, we expanded our relationship with one of the world's largest insurance and financial services companies, implementing new use cases for remote online notary for affidavit citizenship verification and claims recovery, and DocuSign Verify for loans and cash-out statements. By deepening their adoption of the DocuSign Agreement Cloud, they shared that the efficiency gained by their employees and independent agents enabled them to realize tremendous savings in both time and operational expense, all while improving the self-service customer experience and maintaining strict regulatory compliance. We're hearing the same story across our key verticals with new customers as well. Last quarter, one of the largest pharmacy chains in the U.S. adopted e-signature and our AI-powered CLM products as part of their ongoing digital transformation initiative. The Agreement Cloud was the answer to replacing the manual processes across their agreement systems. which were described to us as painful and time-consuming. From that initial order, we're now seeing 75 different use cases across departments and an opportunity to deliver nearly 10 million envelopes annually. Around the world, DocuSign's value prop is just as strong. Last quarter, for example, we welcomed Westpac New Zealand, part of Australia's Westpac group, to the agreement cloud. Like so many customers who start with DocuSign eSignature, our exceptional employee and customer experience opens the door to more use cases. For Westpac New Zealand, this led to the adoption of CLM, GenPlus Send, and a significant API integration, all within the first year of our relationship. The second big opportunity this fiscal year is our continued innovation to drive stickiness and deepen our roots as a multi-product company. More users are engaging with DocuSign every day as we work to make it even easier for them to adopt more of the advanced capabilities of the Agreement Cloud, eliminating paper, automating manual processes, and connecting customers to the other systems they already use. A great example is the new DocuSign eSignature app for Zoom that enables organizations to reimagine their customer agreement process with virtual face-to-face signing experiences that our customers' customers really love. Through this new partnership, our customers can now securely share, review, and complete agreements right from Zoom. In the next few weeks, we'll launch a new e-signature capability called Joint Agreements for businesses with a network model. Joint Agreements allows for a single customer experience with co-management of agreements between multiple parties behind the scenes. This makes things easier for every party involved. We believe Joint Agreements will inspire large financial services firms to encourage the use of DocuSign by their networks, which often number in the tens of thousands of advisors or agents. Next month, we're also planning to launch an important new feature called Delayed Routing for DocuSign eSignature. This allows users to add timing delays during the routing process of an envelope. This fine-tuning of the agreement process has become an increasingly popular customer ask, especially for situations where regulations require a delay, like some franchising agreements that require a one-week delay for a review before they can be signed. In total, fiscal 22 results were very strong, and I'm proud of how we as a team are moving to adapt and recalibrate to address the rapidly shifting market dynamics that we're facing post-COVID. Despite the temporal headwinds, we're continuing to focus on winning both new customers and existing customer expansions, and on driving continued innovation. As a clear market leader, we've got long-term momentum on our side, a vision that's unchanged, and a massive TAMP. The changes we're making to our go-to-market strategy will indeed take a few quarters to play out, but we believe we're still just scratching the surface of our long-term opportunity and our better position than ever for future success. Before handing it over to Cynthia to walk you through our Q4 results and the fiscal year 2023 outlook in more detail, I want to take a moment to thank the DocuSign team and our customers. Together, you're inspiring us to continue pioneering. Just this week, DocuSign was named one of Fast Company's top 10 most innovative enterprise companies. It's great to see others recognize our work, but more importantly, it's a true testament to our hardworking team and the positive impact our customers are helping us make on the world. With that, Cynthia, over to you.
Roger
Thanks, Dan, and good afternoon, everyone. Overall, we had a solid finish to the year. While fiscal 22 unfolded differently than we initially anticipated, With the first half stronger than expected and the back half slowing faster than anticipated, net-net we achieved most of our financial and operating goals for the year. We scaled to become a multi-billion dollar business and achieved record cash flow and operating margins, successfully balancing growth and profitability. We continue to build out our Agreement Cloud portfolio with the addition of multiple new products and capabilities to further digitize agreement workflows. and we helped 280,000 new customers begin their digital journey. With that, let me turn to the Q4 and fiscal 2022 results. For the fourth quarter, total revenue increased 35% year over year to $581 million, and subscription revenue grew 37% year over year to $564 million. For the full year, total revenue reached $2.1 billion, an increase of 45% over last year, and subscription revenue hit $2 billion, an increase of 47%. Our international revenue continued to outpace our domestic growth at 55% year-over-year to $138 million in the fourth quarter, contributing 24% of total revenue. For the full year, international revenue grew over 68% to $481 million, representing 23% of our total revenue and reflecting our accelerated expansion across geographies. Fourth quarter billings rose 25% year over year to $670 million, leading to a four-quarter rolling average of 37%. For the full year, billings increased 37% to $2.4 billion. With the addition of nearly 60,000 new customers in the fourth quarter, our total install base grew 31% for the full year, with over 1.17 million customers worldwide. We added 10,000 new direct customers in Q4 and 45,000 for the year, and 36% increase year over year, bringing our total to 170,000 direct customers. Customers with an annual spend greater than $300,000 grew 42% year over year in the fourth quarter to 852 customers. We achieved 119% dollar net retention for the quarter at the high end of our historic range. Non-GAAP gross margin for the fourth quarter was 81% compared with 80% a year ago. For the full year, gross margin was 82% compared to 79% a year ago. Fourth quarter subscription gross margin was 85%, consistent with last year. For the full year, subscription gross margin was 85% versus 84% a year ago. Q4 non-GAAP operating profit reached $104 million compared with $75 million last year. Non-GAAP operating margin was 18% compared to 17% last year. For the full year, non-GAAP operating profit rose 132% to $419 million and operating margin was 20% versus 12% in fiscal 21. Non-GAAP net income for Q4 was $100 million compared with $77 million in the fourth quarter of last year. For the full year, net income was $411 million, up from $182 million in fiscal 21, a growth rate of 125% year-over-year. We ended the quarter with 7,461 employees, an increase of 33% over last year. We exited the year with $898 million in cash, cash equivalents, restricted cash, and investments. Operating cash flow in the fourth quarter grew 41% year-over-year to $88 million, or a 15% margin. This compares with $62 million, or 14%, in the same quarter a year ago. Pre-cash flow for the quarter was $70 million, or a 12% margin, compared to $44 million, or 10% in the prior year. a 60% increase year over year. For the full year, operating cash flow grew 71% to $506 million, or a 24% margin, compared to $297 million, or 20% a year ago. And free cash flow more than doubled, growing at 107% year over year to $445 million, or a 21% margin, compared to $215 million, or a 15% margin in fiscal 21. Additionally, we continue to invest for the health of our planet through our sustainability initiatives. Our products have helped save over 55 billion sheets of paper and 6 million trees so far, and we achieved carbon neutral status this year. We are continuing our efforts to reach net zero emissions no later than 2050 as part of the Business Ambition Pledge by committing to setting science-based targets aligned with a 1.5 degree Celsius trajectory for a net zero future. Let me now turn to our guidance. As Dan mentioned, early in fiscal 22, we continue to benefit from macro tailwinds with strong residual customer demand. Today, while we see the lingering effects tapering from the heightened demand we saw a year ago, we expect to see a slower start to fiscal 2023 while we progress our go-to-market initiatives over the next few quarters. As we gain traction and execute against our strategy, we continue to win new customers and support existing customer success and expansion, we expect to see the related growth contribution picking up as we move through the year. We have worked diligently to incorporate the above factors into our current outlook. With that, let's turn to guidance. Total revenue of $579 to $583 million in Q1, or growth of 24% year over year, and $2.47 to $2.48 billion for fiscal 23, or growth of 17% to 18% year over year. Of this, we expect subscription revenue of $562 to $566 million in Q1, or growth of 24% to 25% year over year, and $2.39 to $2.41 billion for fiscal 23, or growth of 18% year over year. For billings, we expect $573 to $583 million in Q1, or growth of 9 to 11% year-over-year, and $2.71 to $2.73 billion for fiscal 23, or growth of 15 to 16% year-over-year. We expect non-GAAP growth margin to be 79 to 81% for both Q1 and fiscal 23, We expect non-GAAP operating margin to be 16% to 18% for both Q1 and fiscal 23. We expect to see a de minimis amount of interest and other income, including undrawn revolver fees related to our credit facility. For fiscal 23, we expect a tax provision of approximately $4 to $8 million. We expect fully diluted weighted average shares outstanding of $205 to $210 million for both Q1 and fiscal 23. Additionally, our board authorized a $200 million open market share repurchase program. This program underscores our confidence in the strong fundamentals of our business and allows us to flexibly leverage our balance sheet to efficiently deliver returns to our shareholders. Our primary focus will continue to be investing for long-term growth, particularly in sales capacity and enablement, marketing, product innovation, and the scaling of our operations. as we are still in the early stages of this large and growing market opportunity. Before turning to Q&A, we would like to thank the DocuSign team, our customers, and our partners for their tremendous efforts during last year's unprecedented journey. We're driving the next phase of our strategy to better enable our teams to help customers digitize their agreement processes and fully capture the potential of the $50 billion agreement cloud market. In the near term, while we ramp and strengthen our demand gen motion, we are confident in the opportunity that lies ahead for the agreement cloud and are encouraged about the broader market opportunity we're seeing on the horizon. We remain focused on delivering solid results for our shareholders. With that, thanks for joining us today. We look forward to seeing you at the Customer and User Conference Momentum in a few weeks on April 4th and 5th, and we will now open up the call for questions. Operator?
Operator
Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the queue. You may press star 2 if you would like to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. We ask that you limit yourself to one question and one follow-up. One moment please while we poll for questions. Our first question comes from the line of Tyler Radke from Citi. You may proceed with your question.
Tyler Radke
Hey, thanks. Good afternoon. Appreciate the question here. I wanted to first start about the go-to-market changes that you're making, obviously some new kind of sales leadership moving around. Maybe if you could help us unpack kind of the relative impact you know, size of these changes and how they compared relative to your initial expectations last quarter? And then how are you just thinking about the timing for when demand starts to rebound? You know, is this a Q3, Q4 event? How are you building that into your forecast? Thank you.
Roger Martin
Yeah. So, Tyler, at first, at the high level, I would say there are substantial changes to go-to-market organization. We're bringing in an overall new leader for success and sales, which is 65% of our company. So I would say that is, from a headcount standpoint, very substantial. In addition, we've already made virtually a complete sort of change out, if you will, of the sales leadership in North America. So I mentioned we have, if you think about our segments, we have the SMB, the commercial, and the enterprise. We have new leaders in North America coming from great, scaled companies. companies like Oracle and Salesforce.com, and those leaders are over the SMB and commercial, and we are very close to finalizing a new enterprise leader. So North America is where we had our biggest challenges that we talked about from the headwinds at the end of last year, and so that is absolutely where we're focused. We have not, since I joined the company five years ago, had anything sort of close to this change in the go-to-market teams. And then to your second question on the timing, you know, I don't have an ability to tell you exactly, you know, which quarter we see, you know, those changes having which level of impact. If you take a look at, you know, Cynthia's provided guidance to give you a sense that we think it's, you know, significant changes are required to the business and our aspiration is to move as quickly as we can to try to have that impact as quickly as possible, get us back to the long-term growth rates that we're highly confident we will get to.
Tyler Radke
Great. Thank you. And second question, you talked about seeing some CLM deals and, you know, with that being a focus for some of the upsell motions. Can you just talk about how CLM is performing relative to your expectations? And, you know, do these go-to-market changes help to elevate CLM more? Just help us understand how you're thinking about that relative to the core e-sig. Thanks.
Roger Martin
Yeah, absolutely. And in fact, we didn't go into too much detail, but what we've done, as you think about what we said last quarter, we realized we really needed to get our field focusing. And for us, field is, again, not just their sales team, but it's also the success team that is so critical to driving the adoption that we get and then the consumption, which leads to that future growth. to get them focused on our core e-signature and e-signature plus products. And we are hugely excited about but also focused on that execution. So part of the challenges is we were onboarding AEs and other field personnel throughout last year. We were asking them to be really able to sell the entire DocuSign Agreement Cloud. We wanted them to put more things in the bag, if you will. I think what we realized, it was defocusing folks from the Cori signature business. So we pulled out a dedicated CLM team, and the purpose is both to address your question, hey, do we get enough focus on training sellers to really be competitive and you know, to win in what is a competitive market there. It's different than the leadership position we have in e-signature, but also it frees up our traditional field to focus on the e-signature and e-signature plus opportunity, which is critical to our overall agreement cloud success. So those are the changes we made. We think those are, you know, substantial change, and we think that should be significant to help us, again, drive focus on both areas of growth.
Dan
Thank you.
Operator
Our next question comes from the line of Sterling Audi with JP Morgan. You may proceed with your question.
spk04
Yeah, thanks. Hi, guys. Can you characterize what the sales pipeline looked like at the end of the quarter versus what it looked like coming into the quarter?
Roger Martin
So, I mean, we don't have sort of a pipe metric that we would, you know, sort of disclose or share, but I can tell you from a standpoint of we build pipe in two different ways in terms of two different timeframes. So right now we are building pipe focused on Q2 as a primary goal. But if you get down to our SMB and the sort of the bottom half of the commercial business, quite a bit of the pipe that we generate actually can close in quarter. So I think what we're seeing right now is a significant increase in our achievement of our pipeline goals today than where we were a quarter ago. But again, some of those things were for this quarter and some would be for the quarter ahead.
spk04
Understood. And then one follow-up. Can you give us a sense of what the net dollar retention expectation is that's kind of built into the guidance that you gave?
Roger Martin
Yeah, we don't guide to that metric. And, Cynthia, I don't know if you have any color you would add to net retention going forward.
Roger
Yeah, so I would say Q4 we landed at the 119%, which was at the high end of our historic range. For Q1, we would expect to be within range between the 112% and 119%. That has been our historic range. But it's not, Sterling, as you know, a metric that we've traditionally guided to, though we have tried to give color around what we're seeing there.
spk04
Yep. Understood. Thank you, guys.
Operator
Our next question comes from the line of Rishi Jaluria with RBC. You may proceed with your question.
Rishi Jaluria
Oh, wonderful. Thanks, Dan and Cynthia, for taking my questions. First, I wanted to just start on the billings guidance for next year. You know, look, it does imply a little bit of an acceleration, perhaps more than a little bit, depending on how we think about seasonality here. in the back half of FY23 relative to what you're guiding to in Q1. Can you maybe walk us through, you know, the dynamics there? What's giving you confidence in that acceleration outside of the, you know, obvious easy comps? And I guess maybe alongside that, you know, look, I mean, your stock's down to, you know, in the aftermarket where it was before COVID even happened and, you know, pulled forward all those demands. I guess, Why even, you know, provide Billings Genentech calls for a good amount of acceleration in the back half of the year? Is that, you know, based on pipeline, something that you're seeing to be able to give that level of confidence, just given how quickly these sort of things change? And then I've got to follow up.
Roger
Sure. So I think I'll start and then I'm sure Dan will have some good thoughts as well. So I think just to level set on Q1, you know, if you think back to early fiscal 22, you know, we continue to benefit, particularly in Q1 of last year from the macro tailwinds coming out of the year prior, right, with strong residual customer demand. And we talked on the Q1 call last year about some of the dynamics around that, which included accelerated consumption and expansion, things like one-time use cases that fell into Q1, and then early renewals played a big dynamic. So if you think about that as macro tailwinds that helped us in Q1 last year, we have kind of the opposite in terms of some headwinds this year. So I'd say when you look at the Q1 guide, you have to remember that last Q1 was exceptional, and it was a pretty extraordinary quarter. And so we've really been tapering off of those levels since this time last year, and we expect to build back over the next few quarters as some of these go-to-market initiatives take hold. So I'd kind of leave you with that thought, particularly as we look at the Q1 numbers.
Roger Martin
And the only thing I'd add to that is that if you take a look at the level of execution that that implies, while it's increasing, as you said, across the year, we're also revamping, as Tyler asked about earlier. our go-to-market organization. And just to be really clear, we've not performed the way we would like to perform at the end of this year. And at the beginning of this year, we're not going to be yet back to the performance we'd like to have. It is going to take a little bit of time. So we're quite optimistic that as the new leadership gets a chance to get embedded, that we have this incredible market opportunity and this really large customer base. As you saw in the numbers, increasing at good rates with 60,000 new ads just in the last quarter. So we've got a lot of opportunity for our land and expand motion. So we are confident that our teams will rise to that occasion and then drive that and improve performance throughout the year.
Rishi Jaluria
Okay, great. That's helpful. And then I wanted to look at international. So international decelerated by a pretty dramatic magnitude from Q3 to Q4. Maybe walk us through what's going on in international, how we should be thinking about that going forward. I mean, especially because, you know, look, as we've talked about before, international feels like it should be a lot more underpenetrated. And maybe as a result, shouldn't be, you know, suffering from the lack of demand generation to the same extent as the U.S. And yet we're seeing 13 points of diesel from Q3 to Q4. So maybe can you walk us through what's going on internationally as well? Thank you.
Roger
Yeah, I'll start with that one. So on international, we were quite pleased with the performance in Q4 and for the year, right? So 24% of our revenue came from international, and it was a 55% growth rate year over year. So again, we were quite pleased with the performance. We saw particular strengths. in EMEA and APJ around some of the initiatives and investments we've made there. So I would say we would expect that to continue as we look into the year we're making a lot of international investments. And in some ways, it's really our biggest growth opportunity when we look across the business as international.
Dan
All right, great. Thank you so much.
Operator
Our next question comes from the line of Jake Roberge with William Blair. You may proceed with your question.
Jake Roberge
Hey, everyone. Thanks for taking my questions. Just wanted to touch base. You mentioned some of your ancillary products like remote online notary and ID verification. On the call, I was just kind of curious how that's tracking at the start of this year and what your expectations for these markets are over the next few years and when we could really just expect those to be a more material portion of your revenue base.
Roger Martin
Yeah, so two thoughts. One, obviously the starting point, particularly something like notary, which really wasn't until Q4. that we had what I'd say significant sales success there. So very, very small numbers. But from a growth standpoint, quite substantial. We were 4X where we sort of thought we were going to be in Q4 in terms of that sales growth. And we've now really added a quite reasonable number of customers. Our challenge now moves to that success part of the organization that we talked about, which is making sure that the folks adopt and really integrate that notary into their overall business. So we're excited about that. When we look at your questions around identity, I think it's the single biggest sort of, if you will, e-sign plus product category we have, and our enthusiasm there is quite high that that will continue to grow into being, you know, eventually a meaningful contributor, as you asked about. So we're, again, early low numbers, but that's been a real bright spot for us as we finished up Q4.
Jake Roberge
Awesome. And then just as a follow-up, just curious if there was anything to call out really from a competition or return perspective, or is this really just a function of customers in real estate and financial services, just given mortgage refinancings and everything are just so down this year? Is this really just a matter of those customers that overbought and are rationalizing agreements, or are you seeing the space in e-signature become more competitive this year?
Roger Martin
Yeah, so two things. Cynthia and I, you know, before each earnings call, have a review with our pricing and competition team to see if there is anything that we see differently. There's, again, this quarter, nothing substantially different there. We don't see any meaningful change in pricing or competitive sort of intensity. In addition, when I think about the conversations I have in the field with customers, we continue to see people, you know, quite positively talk about DocuSign as a, you know, dramatic market leader with significant improvements. product capabilities and differentiation. So we don't see that changing. I think to your hypothesis, absolutely. the phenomenon of the aggressive demand we saw a year ago is the biggest piece, that macro change. I would also tell you that your insight around financial services, not so much real estate, not the actual real estate industry, but the mortgage space or other financial services, they were the industries, along with healthcare, life sciences, and government, that most aggressively, and we're primarily talking about North America here, but most aggressively expanded the over those six or seven quarters where COVID was so meaningful. And therefore, they probably had the most on the shelf, if you will, from a product standpoint, and are now saying, hey, we love DocuSign. We're not interested in working with someone other than DocuSign, but we have a lot of product. And so we're going to grow at lower rates until we sort of get all of that consumed. So that's how I would characterize that.
Roger
Yeah, and the only other thing that I would add is just, you know, Dan's spot on, but on the verticals, you know, just as a reminder, we don't have any vertical concentration. So, you know, we always try to give a little bit of texture around the verticals, but I would say, you know, one of the great things about DocuSign is, you know, we touch all verticals and, you know, smallest customers to biggest customers, and then we're in 180 countries. So it's a quite diversified customer base.
Dan
Great. Thanks for taking my questions.
Operator
Our next question comes from the line of Stan Zlotsky with Morgan Stanley. You may proceed with your question.
Stan Zlotsky
Hey, guys. Good afternoon, and thank you for taking my question. Two quick questions. On just, you know, high level, as far as the changes that you guys are making to the sales organization, is there anything different that's happening that the changes are being made in the U.S. versus what needs to be made international?
Roger Martin
Yes, dramatically different. As we talked about a little bit, it may not have been clear enough on the prepared comments, and we felt we had made the moves to really solidify our leadership in both success and sales in our core international markets. So in APJ, LATAM, and in EMEA, which is our biggest international market, we're excited. We're not making changes to the leadership there. We're trying to integrate the sort of performance there by having the success and the sales teams work more closely together. I think they're already naturally doing that in those markets better than we're doing in the U.S., but we even want to sort of push that even further to ensure we're bringing that core motion of sign up a customer, get that land that we talk about, drive the adoption and the success, which then leads right into the expansion opportunity. We really want to really refine that. In North America, it's quite different. As I said, we're actually replacing the core North American sales leadership. And by the way, many of those people have done incredible work for DocuSign and will have other roles in DocuSign. It's not that we're necessarily pushing anyone out of the company, but we see an opportunity to bring in additional in the SMB, commercial, and enterprise level, new leadership there that's had more scale experience, which relates to the fact that our North American business is still 76% of our revenue, and so therefore significantly higher scale than any of the international markets. So that's where the changes that we're making to the sales leadership are occurring.
Stan Zlotsky
Got it. And then just a quick follow-up just on Fiscal 23 Billings Guide. With Billings Guide essentially implying what's called roughly 15% growth, if net revenue retention stays in the typical 112 to 119 range, it almost feels like there's limited implied new customer acquisition. So maybe just kind of walk us through, how are you thinking about pace of new local acquisitions into fiscal 23? Because obviously it continues to be very strong. So what's implied in that guidance there?
Roger
Yeah, thanks for the question. So, you know, as you know, we always give our best view of what we're seeing kind of where we're sitting, you know, in the year in the quarter. And so, you know, we're very consistent in terms of how we give the guide. I think when you think about the net ads, you know, we're very pleased with the net new ads that we added during the course of the year and in Q4. And remember, we have a land and expand model, and so the net new each period doesn't necessarily contribute the largest dollars when you're looking at some of the metrics like billings or revenue. But the land and expand, we are very focused on landing new customers because they become the expansions of tomorrow, but they tend to start out very small, expand in small increments over time. And so that is as well built into the guide. But it is a land and expand model as we think about whether it's revenue or billings.
Dan
Got it. Thank you.
Operator
Our next question comes from the line of Carl Keirstead with UBS. You may proceed with your question.
Carl Keirstead
Thanks. Maybe I'll direct this one to Cynthia. Cynthia, your operating margin guide for fiscal 23 was a little bit higher actually than I was thinking. And I think a lot of people thought it might be a little bit lower given DocuSign's got a big need to invest, wage inflation, an uptick in T&E costs, but it's only down two points from your peak. Can you talk through what perhaps some of the offsets to those sources of cost pressures are that got you landing at the 18% number? Thank you.
Roger
Yeah, so the guide is 16 to 18, you know, coming off of kind of the peak that was, I guess, 20-ish, right, during the course of last year. And we've been talking about this since Q1 of last year when we saw the revenue upside that we would expect the margin to come down, you know, and we're very focused on investing for growth. We're investing a lot both in kind of the go-to-market initiatives that we've been talking about, sales capacity, success, and marketing, but also product innovations. And then, remember, we've also doubled our business in a very short period of time in the last two years-ish. We've doubled the top line, and so we're also investing quite a bit kind of across the operations to really support the scale and the growth that we're at. So we think we have the right level of investment. As we move through the year, if we see opportunity to invest more for growth and invest productively, we will. But right now, we're looking at 16% to 18% margin, and we think that's a reasonable investment level to invest back into the business and invest for growth.
Carl Keirstead
And Cynthia, as a follow-up, does that assume any change in average cash comp structure at DocuSign in order to attract and retain employees? Yes.
Roger
We're always evaluating kind of the, you know, it's a very competitive talent market both for the employees we have and folks who may join us along the way. So we're always evaluating that and looking to be, you know, market competitive, whether it's on cash comp or, you know, how we look at the equity. And so yes to both of those.
Carl Keirstead
Got it. Okay.
Dan
Thanks very much.
Operator
Our next question comes from the line of Brad Sills with Bank of America. You may proceed with your question.
Brad Sills
Oh, great. Thanks, guys, for taking my questions here. I think, Dan, when we spoke last quarter, it sounded like the pivot towards expand wasn't going to be such a big change. It's a motion that the company had been successful with in the past, and it seemed like it was more of new hires just hadn't been trained on that kind of motion, given all the demand for new orders that were coming in. It seems now as though perhaps with the leadership changes that you're talking about, that perhaps it's a bigger undertaking that you might have expected back then? Is that a fair assessment? I guess, how would you gauge the efforts so far to kind of retool towards that expand that you've been embarking on now? Thank you. Thanks so much.
Roger Martin
Yeah, it's a good question. I think about it in two different pieces. I think the challenge to sort of get what we internally call the DocuSign way, which is that way we enable our field to sell and lead with the DocuSign Agreement Cloud. And in most cases, people do start with signature. And if you're talking about our existing customers, it's expansion of the core signature land that we've had, as well as then integrating the eSign Plus products and other products like CLM. I think that we started off and feel like that was the right effort, and the investment we're making there feels, I think, good, and we think we'll be able to roll that out. We just had our GKO a few weeks ago, and we felt rolling out that new methodology and approach to try to get that consistency that you were asking about, that we talked about, is spot on. I'd say incremental to that, as we were examining what we're doing right and what we're not doing right in our overall go-to-market approach, we realized we did have some gaps in the scaled experience in our leadership, which is what led us to make the significant changes we've already made in North America and the decision to bring in a truly scaled overall success and sales leader. So I think the changes that we thought we were going to make are kind of running, I would say, more or less on track. And we also realized that we wanted to make enhancements to the leadership in the go-to-market team, and that's what we announced today. So I think we're, again, more or less on that same track, but we did not necessarily know when we were diving in a few months back that we think it made sense to make those significant changes we're making in the leadership. Okay.
Brad Sills
Understood. Thanks so much, Dan. One more, if I may, please. I think last quarter you mentioned that consumption patterns and demand on consumption was kind of in line with your expectations. Would you say that's the same this quarter? Any comment there? Thank you.
Roger Martin
Make sure I clarify the question. When you're saying consumption, there's a word we use for meaning different things. Are you talking about usage of the e-signature platform?
Brad Sills
Yeah, usage and volumes, envelope volumes.
Roger Martin
Yeah. Yeah, so I think there's two ways to think about it. One is sort of the amount that we sell, if you will, and the amount that gets utilized. We saw pressure on what gets sold for two different reasons. One was consumption-related. We're not significantly off, and clearly consumption is growing, but it was not growing the same way it was growing during the COVID years when we had that heightened demand and so many new use cases that people hadn't had before. And quite frankly, we also had a lot of one-time use cases, things like PPV loans. And so now if you look at consumption, if you adjust for things like those one-time use cases and heightened demand, I don't see any dramatic change in our consumption. But those are meaningful. So as Cynthia said, they have meaningful impact on our financials for Q1 and really the first half of this year, some of those use cases going away. And keep in mind, when you think about the growth rate, If someone says, you know, I'm putting in a million signatures for some one-time use cases, not only do you lose those millions, so you go the wrong direction, but there's no chance to upsell them for the one-time use case. So it weighs down on the growth of consumption and of selling for the overall from that base.
Brad Sills
Very helpful. Thanks, Dan.
Operator
Our next question comes from the line of Alex Zukin with Wolf Research. You may proceed with your question.
Alex Zukin
Hey there, this is Alan Verkovsky on for Alex. Thanks for taking the question. I wanted to touch on the revenue guidance. I haven't seen you guys guide for flat sequential revenues before. So can you just unpack the puts and takes there? Is there any incremental prudence within your guide, especially as to how it relates to contribution you can see from EMEA?
Alan Verkovsky
Thanks.
Roger
Sure, thanks for the question. So I think when you look at the revenue guide, it's similar to my comments earlier. We're guiding to the visibility we have given the current environment. There's probably two key drivers on revenue behind the guide. One is headwinds from some of the one-time use cases rolling off or renewing at lower levels. The second is just the timing of deals, of deals rolling into the quarter and deals rolling out of the quarter. So I'd say that's kind of on revenue specifically. But I would also just reiterate some of the comments I made on a relative basis to Q1 of last year and kind of just the unusual quarter that that was on a comparative basis.
Alan Verkovsky
Got it. And nothing else incremental in terms of how you're thinking about EMEA contribution for the full year?
Roger
Amiya, like from a geo perspective?
Alan Verkovsky
Yeah, just given everything going on there and in the world.
Roger
Oh, I see. Just, you know, the macro. Yeah, from a macro perspective. So, yeah. So I think, you know, what we would say there is, you know, we haven't seen a big impact to our business. You know, it's a horrible humanitarian crisis and tragedy, you know, but we haven't seen impact. But Amiya is a large business for us. So it is something that we are looking at closely, and I would just say we are supporting efforts there through our global impact initiatives from a broader perspective, less to do with our business, but it's something we're watching closely, but we haven't seen much, if any, impact there where we currently sit.
Alan Verkovsky
Understood. Thanks for taking my questions.
Operator
Our next question comes from the line of Kirk Matern with Evercore ISI. You may proceed with your question.
Kirk Matern
Yeah, hi, guys. This is actually Peter Berkeley. I'm for Kirk. Thanks for taking the questions here. I guess just first, you know, you guys have talked about in the past, you know, how getting the 5 billion in revenue, you know, that's going to become, you know, a large part for me signature. I'm just curious, given, you know, you're seeing a lot of strength in some of these ancillary products, you know, a little bit of slowdown and you signature, you know, piece. Curious if you're thinking any differently about the balance between that. And yeah, and you know, I guess an incremental investments, whether there's any change in investing for, you know, investing in the cross-sell motion versus, you know, the continued investments that you're making to, you know, remedy the demand generation aspect?
Roger Martin
Yeah, I don't think there's any meaningful change on either of those dimensions. You know, as we've talked about before, we think it is very early in the e-signature. You know, just on the e-signature loan, right, we talked about that $25 billion TAM. And so I said you were, you know, definitely less than 10% of that. And given our strong market share that we have in the space, I'm not sure that the whole industry is much past 10% penetration there. So I don't think there's anything that suggests to us we'd be less aggressive or bullish on having that be the primary growth opportunity for us. We are very excited about the agreement cloud opportunity broadly, but there's nothing that's happened that would change my bullishness on the primary growth opportunity being e-signature, particularly if you add in what we call e-signature plus, and those are those other, you know, functionality we talked about, like a notary capability, like an identity capability. I think when you add those in, yeah, we're squarely focused on the core business.
Kirk Matern
Awesome. That's helpful, Dan. And I guess if I could just follow up with one more, you know, I think the large customer growth actually is one of the more impressive, you know, metrics I'm looking at, you know, grew that metric by plus 40% again. So I guess just curious if there's anything to highlight in terms of what's driving the strength there. You know, are these larger customers thinking more strategically about the broader agreement cloud solutions? Or is it still, you know, for those large customers specifically, it's still just a function of continuing to expand their e-signature usage?
Roger Martin
So some of each, actually. And if you think about it, you know, we talked about a couple of examples, like large companies. pharmacy company that was not a significant signature company, a signature user of us. And then they got excited about CLM, and not only did that create the opportunity for growth there, but it unlocked significantly more use cases around signature once they thought about it in a CLM and CLM Plus mindset. So I think the answer is it's definitely some of both. From an allocation, signature is still by far the biggest driver of the increase in customers moving up to that large customer scale for us. And, again, the vast majority of our customers still have only a small number of use cases, which points, again, to two things. One, tremendous opportunity, but also, as I said, we have to own that we haven't executed well enough. against that significant opportunity because aside from the macro pieces we talked about, a part of this is us doing that fantastic job we need to do and we have done traditionally around that land and then get the success motion and get the upsell motion going. So that's there for us. We just have to execute.
Alan Verkovsky
Got it. Thanks, Dan. Appreciate it, Keller.
Operator
Unfortunately, due to time constraints, we only have time for one more question. Our final question comes from the line of Scott Berg with Needham. You may proceed with your question.
Scott Berg
Hi, Dan and Cynthia. Thanks for taking my questions here. I'll actually just leave it with one since we're up against the clock. Dan, I wanted to ask or drill down a little bit more on the change in CRO with the new field sales leader that will eventually join. You're making a lot of changes to the organization before this new leader comes in. I guess... How should we think about that kind of dynamic? Because on one hand, you feel pretty confident about the changes you're making. But what if the sales leader comes in and wants to make additional changes? How do we think about kind of that scenario with regards to the timeframe of when you can start kind of producing at the levels that you're really expecting to?
Roger Martin
Well, it's a good question, obviously, something we think a lot about, and it's difficult to speculate, right, on a double level of what that person might want to do and then how we would think about reaction. Obviously, we're not going to bring in a person that has that kind of experience and that kind of scale in their background and say, your hands are tied, you can't make any changes to the go-to-market organization, for sure. But the changes we've made aren't so much dramatically changing the way we do things. We already talked about what we were building out last quarter around the DocuSign way. These changes are really about saying we need to have more scaled leadership. We have lots of fantastic people at DocuSign. We didn't have enough people who had seen this level of scale. And so I am confident that the new leader that comes into this role, she or he will look and say, this is fantastic. You guys have already set me up. with a fantastic set of scaled leaders across North America and across the international geographies, you've got folks that have hit their stride at DocuSign and are driving that much higher growth already than we have in North America. So I feel like we're handing, again, her or him a fantastic hand. But of course, you're right that if the person had different perspectives or other folks that they thought or structured that made sense to change, we of course engage with them in a, you know, constructive way on that. But my belief is it's nothing but goodness with the changes we've made.
Dan
Great. That's all I have. Thanks for taking my questions.
Operator
This concludes the question and answer session. And now I'll turn the call back over to Dan Springer for any closing remarks.
Roger Martin
Yeah, I'll be quick. You know, guys, I want to point out a couple quick things. We really do feel good about the solid finish to the year, hitting that milestone of $2 billion of revenue. We're excited. You're right. We've been talking a lot about $2 billion to $5 billion, but we had to hit two first, so we're glad to do that. And exiting the year at 45% growth, you know, another fantastic annual growth rate. It just, I think it points to the opportunity that we have here. We are building out what I think is going to be a really strong, durable franchise that already starts from a fantastic position of clear market leadership. We have a massive TAM and opportunity ahead of us. And we have to execute now. And we will execute now. So we're looking forward to seeing you all in the coming months. Thank you very much for joining us.
Operator
This does conclude today's conference. You may disconnect your lines at this time. Thank you for your participation and have a great day.
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