Total revenues of $136.8 million, up 20%
year-over-year Net income growth of 44% and adjusted EBITDA growth
of 41% year-over-year
Doximity, Inc. (NYSE: DOCS), the leading digital platform for
U.S. medical professionals, today announced results of its fiscal
2025 second quarter ended September 30, 2024.
“Our clinical workflow tools saw record use in Q2 with over
600,000 unique active prescribers,” said Jeff Tangney, co-founder
and CEO of Doximity. “We’re proud to help physicians save time, so
they can provide better care for their patients.”
Fiscal 2025 Second Quarter Financial Highlights
All comparisons, unless otherwise noted, are to the three months
ended September 30, 2023.
- Revenue: Revenue of $136.8 million, versus $113.6
million, an increase of 20% year-over-year.
- Net income and non-GAAP net income: Net income of $44.2
million, versus $30.6 million, representing a margin of 32.3%,
versus 26.9%. Non-GAAP net income of $61.1 million, versus $45.6
million, representing a margin of 44.7%, versus 40.1%.
- Adjusted EBITDA: Adjusted EBITDA of $76.1 million,
versus $54.2 million, an increase of 41% year-over-year,
representing adjusted EBITDA margins of 55.7%, versus 47.7%.
- Diluted net income per share and non-GAAP diluted net income
per share: Diluted net income per share was $0.22, versus
$0.15, while non-GAAP diluted net income per share was $0.30,
versus $0.22.
- Operating cash flow and free cash flow: Operating cash
flow of $68.3 million, versus $12.9 million, an increase of 430%
year-over-year, and free cash flow of $66.8 million, versus $11.6
million, an increase of 475% year-over-year.
Financial Outlook
Doximity is providing guidance for its fiscal third quarter
ending December 31, 2024 as follows:
- Revenue between $152 million and $153 million.
- Adjusted EBITDA between $83 million and $84 million.
Doximity is updating guidance for its fiscal year ending March
31, 2025 as follows:
- Revenue between $535 million and $540 million.
- Adjusted EBITDA between $274 million and $279 million.
Conference Call Information
Doximity posted prepared remarks on its investor relations
website at https://investors.doximity.com. Doximity will host a
webcast today at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) to
discuss these financial results. To listen to a live audio webcast,
please visit the Company’s Investor Relations page at
https://investors.doximity.com. The archived webcast will be
available on the Company’s Investor Relations page shortly after
the call.
About Doximity
Founded in 2010, Doximity is the leading digital platform for
U.S. medical professionals. The company's network members include
more than 80% of U.S. physicians across all specialties and
practice areas. Doximity provides its verified clinical membership
with digital tools built for medicine, enabling them to collaborate
with colleagues, stay up to date with the latest medical news and
research, manage their careers and on-call schedules, streamline
documentation and administrative paperwork, and conduct virtual
patient visits. Doximity's mission is to help doctors be more
productive so they can provide better care for their patients.
Forward-Looking Statements
Statements we make in this press release may include statements
which are not historical facts and are considered forward-looking
within the meaning of Section 27A of the Securities Act and Section
21E of the Securities Exchange Act, which are usually identified by
the use of words such as “anticipates,” “believes,” “estimates,”
“expects,” “intends,” “may,” “plans,” “projects,” “seeks,”
“should,” “will,” and variations of such words or similar
expressions. We intend these forward-looking statements to be
covered by the safe harbor provisions for forward-looking
statements contained in Section 27A of the Securities Act and
Section 21E of the Securities Exchange Act and are making this
statement for purposes of complying with those safe harbor
provisions. These forward-looking statements reflect our current
views about our plans, intentions, expectations, strategies and
prospects, which are based on the information currently available
to us and on assumptions we have made. Although we believe that our
plans, intentions, expectations, strategies and prospects as
reflected in or suggested by those forward-looking statements are
reasonable, we can give no assurance that the plans, intentions,
expectations, or strategies will be attained or achieved.
Furthermore, actual results may differ materially from those
described in the forward-looking statements and will be affected by
a variety of risks and factors including (i) the timing and scope
of anticipated stock repurchases; (ii) the impact of uncertainty in
the current economic environment and macroeconomic uncertainty;
(iii) our ability to retain existing members or add new members to
our platform and maintain or grow their engagement with our
platform; (iv) our ability to attract new customers or retain
existing customers; (v) the impact of our prioritization of our
members’ interests; (vi) breaches in our security measures or
unauthorized access to members’ data; (vii) our ability to maintain
or manage our growth, and other risks and factors that are beyond
our control including, without limitation, those set forth in the
section entitled “Risk Factors” in our Annual Report on Form 10-K
for the fiscal year ended March 31, 2024 and as may be updated in
any subsequent Quarterly Reports on Form 10-Q. Moreover, we operate
in a very competitive and rapidly changing environment. New risks
and uncertainties emerge from time to time, and it is not possible
for us to predict all risks and uncertainties that could cause
actual results to differ materially from those contained in our
forward-looking statements. The forward-looking statements made in
this press release relate only to management’s beliefs and
assumptions as of this date. We assume no obligation to update
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
DOXIMITY, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands)
(unaudited)
September 30, 2024
March 31, 2024
Assets
Current assets:
Cash and cash equivalents
$
184,248
$
96,785
Marketable securities
621,310
666,115
Accounts receivable, net
124,793
101,332
Prepaid expenses and other current
assets
27,361
48,709
Total current assets
957,712
912,941
Property and equipment, net
12,818
12,318
Deferred income tax assets
43,761
45,068
Operating lease right-of-use assets
9,774
12,332
Intangible assets, net
25,195
27,317
Goodwill
67,940
67,940
Other assets
1,316
1,458
Total assets
$
1,118,516
$
1,079,374
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
2,770
$
2,253
Accrued expenses and other current
liabilities
33,540
43,703
Deferred revenue, current
93,751
99,145
Operating lease liabilities, current
2,222
2,149
Total current liabilities
132,283
147,250
Deferred revenue, non-current
148
211
Operating lease liabilities,
non-current
11,269
12,397
Contingent earn-out consideration
liability, non-current
5,469
10,895
Other liabilities, non-current
8,151
7,224
Total liabilities
157,320
177,977
Stockholders' Equity
Preferred stock
—
—
Common stock
187
187
Additional paid-in capital
863,113
823,885
Accumulated other comprehensive income
(loss)
2,676
(2,664
)
Retained earnings
95,220
79,989
Total stockholders’ equity
961,196
901,397
Total liabilities and stockholders’
equity
$
1,118,516
$
1,079,374
DOXIMITY, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except per
share data)
(unaudited)
Three Months Ended September
30,
Six Months Ended September
30,
2024
2023
2024
2023
Revenue
$
136,832
$
113,612
$
263,508
$
222,081
Cost of revenue(1)
13,676
12,759
27,226
25,912
Gross profit
123,156
100,853
236,282
196,169
Operating expenses(1):
Research and development
23,240
19,958
45,814
41,889
Sales and marketing
34,367
30,201
69,611
64,656
General and administrative
10,103
8,966
19,358
18,213
Restructuring and impairment charge
2,304
7,936
2,304
7,936
Total operating expenses
70,014
67,061
137,087
132,694
Income from operations
53,142
33,792
99,195
63,475
Other income, net
9,029
5,903
16,145
10,742
Income before income taxes
62,171
39,695
115,340
74,217
Provision for income taxes
18,017
9,093
29,809
15,209
Net income
$
44,154
$
30,602
$
85,531
$
59,008
Net income per share attributable to Class
A and Class B common stockholders:
Basic
$
0.24
$
0.16
$
0.46
$
0.30
Diluted
$
0.22
$
0.15
$
0.43
$
0.28
Weighted-average shares used in computing
net income per share attributable to Class A and Class B common
stockholders:
Basic
186,252
193,112
185,933
193,813
Diluted
200,407
209,014
199,818
210,681
(1) Costs and expenses include stock-based compensation expense
as follows (in thousands):
Three Months Ended September
30,
Six Months Ended September
30,
2024
2023
2024
2023
Cost of revenue
$
2,661
$
2,278
$
5,555
$
4,739
Research and development
5,447
2,538
10,131
5,794
Sales and marketing
6,808
2,697
13,394
8,692
General and administrative
2,952
2,288
5,878
4,577
Restructuring
—
3,646
—
3,646
Total stock-based compensation expense
$
17,868
$
13,447
$
34,958
$
27,448
DOXIMITY, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended September
30,
Six Months Ended September
30,
2024
2023
2024
2023
Cash flows from operating
activities
Net income
$
44,154
$
30,602
$
85,531
$
59,008
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
2,613
2,604
5,175
5,208
Deferred income taxes
204
—
204
—
Stock-based compensation, net of amounts
capitalized
17,868
13,447
34,958
27,448
Non-cash lease expense
470
540
951
1,077
Accretion of discount on marketable
securities, net
(3,008
)
(1,495
)
(5,368
)
(1,794
)
Amortization of deferred contract
costs
2,033
2,063
4,759
4,730
Impairment of long-lived assets
2,304
—
2,304
—
Other
414
6
(122
)
127
Changes in operating assets and
liabilities:
Accounts receivable
(4,106
)
(4,388
)
(23,478
)
9,644
Prepaid expenses and other assets
9,488
(13,093
)
19,948
(10,504
)
Deferred contract costs
(1,785
)
(1,238
)
(3,216
)
(2,448
)
Accounts payable, accrued expenses and
other liabilities
7,396
(8,740
)
(5,546
)
(8,063
)
Deferred revenue
(9,161
)
(6,831
)
(5,457
)
(13,753
)
Operating lease liabilities
(538
)
(579
)
(1,054
)
(582
)
Net cash provided by operating
activities
68,346
12,898
109,589
70,098
Cash flows from investing
activities
Purchases of property and equipment
—
(41
)
—
(111
)
Internal-use software development
costs
(1,543
)
(1,238
)
(3,247
)
(2,732
)
Purchases of marketable securities
(197,395
)
(144,942
)
(367,808
)
(180,226
)
Maturities of marketable securities
215,855
96,119
417,913
212,768
Sales of marketable securities
7,241
—
7,241
37,525
Net cash provided by (used in)
investing activities
24,158
(50,102
)
54,099
67,224
Cash flows from financing
activities
Proceeds from issuance of common stock
upon exercise of stock options and common stock warrants
7,692
3,933
10,243
7,218
Proceeds from issuance of common stock in
connection with the employee stock purchase plan
1,422
1,494
1,422
1,494
Taxes paid related to net share settlement
of equity awards
(5,828
)
(2,120
)
(8,222
)
(4,084
)
Repurchase of common stock
(22,984
)
(164,429
)
(74,198
)
(186,184
)
Payment of contingent consideration
related to a business combination
—
—
(5,470
)
(5,390
)
Net cash used in financing
activities
(19,698
)
(161,122
)
(76,225
)
(186,946
)
Net increase (decrease) in cash and cash
equivalents
72,806
(198,326
)
87,463
(49,624
)
Cash and cash equivalents, beginning of
period
111,442
306,729
96,785
158,027
Cash and cash equivalents, end of
period
$
184,248
$
108,403
$
184,248
$
108,403
Supplemental disclosures of cash flow
information
Cash paid for taxes, net of refunds
$
9,078
$
29,438
$
21,985
$
29,438
Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements,
which are prepared and presented in accordance with accounting
principles generally accepted in the United States (“GAAP”), the
Company uses the following non-GAAP measures of financial
performance:
- Non-GAAP gross profit, non-GAAP gross margin, non-GAAP
operating income, non-GAAP net income, non-GAAP net income margin,
and non-GAAP basic and diluted net income per common share: We
exclude the effect of stock-based compensation expense,
amortization of acquired intangible assets, change in fair value of
contingent earn-out consideration liability, and restructuring and
impairment charge from non-GAAP gross profit, non-GAAP gross margin
and non-GAAP operating income. Non-GAAP net income and non-GAAP net
income margin are further adjusted for estimated income tax on such
adjustments. We calculate income taxes on the adjustments by
applying an estimated annual effective tax rate to the adjustments.
Non-GAAP basic and diluted net income per common share is non-GAAP
net income attributable to common stockholders divided by the
weighted average number of shares. For both basic and diluted
non-GAAP net income per share, the weighted average shares we use
in computing non-GAAP net income per share is equal to our GAAP
weighted average shares. Non-GAAP gross margin represents non-GAAP
gross profit as a percentage of revenue and non-GAAP net income
margin represents non-GAAP net income as a percentage of
revenue.
- Adjusted EBITDA and adjusted EBITDA margin: We define
adjusted EBITDA as net income before interest, income taxes,
depreciation, and amortization, and as further adjusted for
stock-based compensation expense, change in fair value of
contingent earn-out consideration liability, restructuring and
impairment charge, and other income, net. Net income margin
represents net income as a percentage of revenue and adjusted
EBITDA margin represents adjusted EBITDA as a percentage of
revenue.
- Free cash flow: We calculate free cash flow as cash flow
from operating activities less purchases of property and equipment
and internal-use software development costs.
We use these non-GAAP financial measures internally for
financial and operational decision-making purposes and as a means
to evaluate period-to-period comparisons. Non-GAAP financial
measures are not meant to be considered in isolation or as a
substitute for comparable GAAP financial measures and should be
read only in conjunction with our condensed consolidated financial
statements prepared in accordance with GAAP. Our presentation of
non-GAAP financial measures may not be comparable to similar
measures used by other companies. We encourage investors to
carefully consider our results under GAAP, as well as our
supplemental non-GAAP information and the reconciliation between
these presentations, to more fully understand our business. Please
see the tables included at the end of this release for the
reconciliation of GAAP to non-GAAP results.
Key Business Metrics
- Net revenue retention rate: Net revenue retention rate
is calculated by taking the trailing 12-month (“TTM”)
subscription-based revenue from our customers that had revenue in
the prior TTM period and dividing that by the total
subscription-based revenue for the prior TTM period. For the
purposes of this calculation, subscription revenue excludes
subscriptions for individuals and small practices and other
non-recurring items. Our net revenue retention rate compares our
subscription revenue from the same set of customers across
comparable periods, and reflects customer renewals, expansion,
contraction, and churn. Our net revenue retention rate is directly
tied to our revenue growth rate and thus fluctuates as that growth
rate fluctuates.
- Customers with trailing 12-month subscription revenue
greater than $500,000: The number of customers with TTM
subscription revenue greater than $500,000 is a key indicator of
the scale of our business, and is calculated by counting the number
of customers that contributed more than $500,000 in subscription
revenue in the TTM period. Our customer count is subject to
adjustments for acquisitions, consolidations, spin-offs, and other
market activity, and we present our total customer count for
historical periods reflecting these adjustments.
Reconciliation of GAAP to Non-GAAP Financial Measures
The following tables reconcile the specific items excluded from
GAAP metrics in the calculation of non-GAAP metrics for the periods
shown below:
Three Months Ended September
30,
Six Months Ended September
30,
2024
2023
2024
2023
(unaudited)
(in thousands, except
percentages)
Net income
$
44,154
$
30,602
$
85,531
$
59,008
Adjusted to exclude the following:
Stock-based compensation
17,868
9,801
34,958
23,802
Depreciation and amortization
2,613
2,604
5,175
5,208
Provision for income taxes
18,017
9,093
29,809
15,209
Restructuring and impairment charge
2,304
7,936
2,304
7,936
Change in fair value of contingent
earn-out consideration liability
221
47
423
316
Other income, net
(9,029
)
(5,903
)
(16,145
)
(10,742
)
Adjusted EBITDA
$
76,148
$
54,180
$
142,055
$
100,737
Revenue
$
136,832
$
113,612
$
263,508
$
222,081
Net income margin
32.3
%
26.9
%
32.5
%
26.6
%
Adjusted EBITDA margin
55.7
%
47.7
%
53.9
%
45.4
%
Three Months Ended September
30,
Six Months Ended September
30,
2024
2023
2024
2023
(unaudited)
(in thousands)
Net cash provided by operating
activities
$
68,346
$
12,898
$
109,589
$
70,098
Purchases of property and equipment
—
(41
)
—
(111
)
Internal-use software development
costs
(1,543
)
(1,238
)
(3,247
)
(2,732
)
Free cash flow
$
66,803
$
11,619
$
106,342
$
67,255
Other cash flow components:
Net cash provided by (used in) investing
activities
$
24,158
$
(50,102
)
$
54,099
$
67,224
Net cash used in financing activities
$
(19,698
)
$
(161,122
)
$
(76,225
)
$
(186,946
)
Three Months Ended September
30,
Six Months Ended September
30,
2024
2023
2024
2023
(unaudited)
(in thousands, except per
share data and percentages)
GAAP cost of revenue
$
13,676
$
12,759
$
27,226
$
25,912
Adjusted to exclude the following:
Stock-based compensation
(2,661
)
(2,278
)
(5,555
)
(4,739
)
Amortization of acquired intangibles
—
(137
)
—
(274
)
Non-GAAP cost of revenue
$
11,015
$
10,344
$
21,671
$
20,899
GAAP gross profit
$
123,156
$
100,853
$
236,282
$
196,169
Adjusted to exclude the following:
Stock-based compensation
2,661
2,278
5,555
4,739
Amortization of acquired intangibles
—
137
—
274
Non-GAAP gross profit
$
125,817
$
103,268
$
241,837
$
201,182
GAAP gross margin
90.0
%
88.8
%
89.7
%
88.3
%
Non-GAAP gross margin
91.9
%
90.9
%
91.8
%
90.6
%
GAAP research and development expense
$
23,240
$
19,958
$
45,814
$
41,889
Adjusted to exclude the following:
Stock-based compensation
(5,447
)
(2,538
)
(10,131
)
(5,794
)
Non-GAAP research and development
expense
$
17,793
$
17,420
$
35,683
$
36,095
GAAP sales and marketing expense
$
34,367
$
30,201
$
69,611
$
64,656
Adjusted to exclude the following:
Stock-based compensation
(6,808
)
(2,697
)
(13,394
)
(8,692
)
Amortization of acquired intangibles
(1,061
)
(1,061
)
(2,122
)
(2,122
)
Change in fair value of contingent
earn-out consideration liability
(221
)
(47
)
(423
)
(316
)
Non-GAAP sales and marketing expense
$
26,277
$
26,396
$
53,672
$
53,526
GAAP general and administrative
expense
$
10,103
$
8,966
$
19,358
$
18,213
Adjusted to exclude the following:
Stock-based compensation
(2,952
)
(2,288
)
(5,878
)
(4,577
)
Non-GAAP general and administrative
expense
$
7,151
$
6,678
$
13,480
$
13,636
GAAP operating expense
$
70,014
$
67,061
$
137,087
$
132,694
Adjusted to exclude the following:
Stock-based compensation
(15,207
)
(7,523
)
(29,403
)
(19,063
)
Amortization of acquired intangibles
(1,061
)
(1,061
)
(2,122
)
(2,122
)
Change in fair value of contingent
earn-out consideration liability
(221
)
(47
)
(423
)
(316
)
Restructuring and impairment charge
(2,304
)
(7,936
)
(2,304
)
(7,936
)
Non-GAAP operating expense
$
51,221
$
50,494
$
102,835
$
103,257
GAAP operating income
$
53,142
$
33,792
$
99,195
$
63,475
Adjusted to exclude the following:
Stock-based compensation
17,868
9,801
34,958
23,802
Amortization of acquired intangibles
1,061
1,198
2,122
2,396
Change in fair value of contingent
earn-out consideration liability
221
47
423
316
Restructuring and impairment charge
2,304
7,936
2,304
7,936
Non-GAAP operating income
$
74,596
$
52,774
$
139,002
$
97,925
GAAP net income
$
44,154
$
30,602
$
85,531
$
59,008
Adjusted to exclude the following:
Stock-based compensation
17,868
9,801
34,958
23,802
Amortization of acquired intangibles
1,061
1,198
2,122
2,396
Change in fair value of contingent
earn-out consideration liability
221
47
423
316
Restructuring and impairment charge
2,304
7,936
2,304
7,936
Income tax effect of non-GAAP adjustments
(1)
(4,505
)
(3,986
)
(8,359
)
(7,235
)
Non-GAAP net income
$
61,103
$
45,598
$
116,979
$
86,223
Non-GAAP net income margin
44.7
%
40.1
%
44.4
%
38.8
%
Weighted-average shares used in computing
net income per share attributable to Class A and Class B common
stockholders:
Basic
186,252
193,112
185,933
193,813
Diluted
200,407
209,014
199,818
210,681
Non-GAAP net income per share attributable
to Class A and Class B stockholders:
Basic
$
0.33
$
0.24
$
0.63
$
0.44
Diluted
$
0.30
$
0.22
$
0.59
$
0.41
(1) For the three and six months ended September 30, 2024 and
2023, management used an estimated annual effective non-GAAP tax
rate of 21.0%.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241107362244/en/
Investor Relations Contact: Perry Gold
ir@doximity.com
Media Contact: Amanda Cox pr@doximity.com
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