After-Hours News: Noodles & Company and DocuSign Report Earnings

Two companies from very different industries are grabbing headlines during after-hours trading on Thursday, following the release of their latest quarterly results. Fast-casual restaurant Noodles & Company (NASDAQ: NDLS) reported slow overall revenue growth but achieved notable comparable-restaurant sales growth. Meanwhile, DocuSign (NASDAQ: DOCU) kept up its strong momentum, adding 23,000 customers during its fourth quarter.

Here's a closer look at these stories.

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Noodles & Company

Fast-casual concept Noodles & Company continued to grow its business, albeit at a slow rate. But comparable-restaurant sales growth were robust, once again.

Revenue during the company's fourth quarter of fiscal 2018 was up 0.4% year over year, to $113.2 million. Non-GAAP earnings per share (EPS) came in at $0.01, even with EPS in the year-ago period.

A bright spot for the quarter, however, was the company's 4% growth in systemwide comparable-restaurant sales. Company-owned comparable-restaurant sales, specifically, rose 3.7% year over year, and franchise comparable-restaurant sales gained 5.3%.

"Our strong fourth quarter results, which included sustained comparable sales growth momentum of 4% systemwide, is further evidence that our strategic initiatives are working," said Noodles CEO Dave Boennighausen in the company's fourth-quarter earnings release. The CEO pointed to Noodle's 2018 introduction of its zucchini noodle, noting that it "continues to resonate with guests and contribute meaningfully to product mix and average check."

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Management expects its strong comparable-restaurant sales to persist in 2019, guiding for comp growth of 2% to 4%. In addition, management said it expects full-year 2019 revenue to be between $462 million and $470 million, up from $456.5 million in 2018.

DocuSign

Leading e-signature company DocuSign posted another quarter of strong growth after market close on Thursday. Revenue jumped 34% year over year, to $199.7 million, driven mostly by a 37% year-over-year increase in subscription revenue, which accounted for 94% of total revenue. The remaining revenue came from DocuSign's "professional services and other" segment, which saw revenue increase 5% year over year.

Helping drive DocuSign's growth during the quarter was the company's addition of 23,000 new customers, bringing total customers to 477,000 — up from 373,000 in the fourth quarter of fiscal 2018.

A concern for the period could be the company's narrowing gross margin on both a GAAP and non-GAAP basis. DocuSign's non-GAAP gross margin was 78%, down from 80% in the year-ago quarter. In addition, free cash flow declined from $28.7 million in the year-ago quarter to $22.8 million.

Management said it expects its fiscal first-quarter revenue to be between $205 million and $210 million, up significantly from $155.8 million in the company's first quarter of fiscal 2019. For the full year of fiscal 2020, DocuSign forecast revenue between $910 million and $915 million, up from $701 million in revenue in fiscal 2019.

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Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool recommends DocuSign. The Motley Fool has a disclosure policy.

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