Doximity(US:DOCS)2024-11-07 21:09Revenue Growth - Revenue for the three months ended September 30, 2024 was $136.8 million, representing a year-over-year growth rate of 20%[129] - Revenue for the six months ended September 30, 2024 was $263.5 million, representing a year-over-year growth rate of 19%[129] - Revenue for the three months ended September 30, 2024 increased by $23.2 million (20%) compared to the same period in 2023, driven by a $23.0 million increase in subscription revenue[162] - Revenue for the six months ended September 30, 2024 increased by $41.4 million (19%) compared to the same period in 2023, primarily due to a $41.7 million increase in subscription revenue[162] Net Income and Margins - Net income for the three months ended September 30, 2024 was $44.2 million, compared to $30.6 million in the same period last year[129] - Net income margin for the three months ended September 30, 2024 was 32%, compared to 27% in the same period last year[139] - Net income for the three months ended September 30, 2024 increased by $13.6 million (44%) compared to the same period in 2023, with net income margin improving to 32% from 27%[161] - Net income for the six months ended September 30, 2024 increased by $26.5 million (45%) compared to the same period in 2023, with net income margin improving to 32% from 27%[161] Adjusted EBITDA - Adjusted EBITDA for the three months ended September 30, 2024 was $76.1 million, compared to $54.2 million in the same period last year[129] - Adjusted EBITDA margin for the three months ended September 30, 2024 was 56%, compared to 48% in the same period last year[139] Customer Metrics - Net revenue retention rate for the TTM ended September 30, 2024 was 116%, compared to 114% in the same period last year[134] - Number of customers with at least $500,000 of revenue for the TTM ended September 30, 2024 was 103, compared to 92 in the same period last year[133] - Customers with at least $500,000 of revenue accounted for approximately 83% of total revenue for the TTM ended September 30, 2024[132] Free Cash Flow - Free cash flow for the six months ended September 30, 2024 was $106.3 million, compared to $67.3 million in the same period last year[143] Gross Profit - Gross profit for the three months ended September 30, 2024 increased by $22.3 million (22%) compared to the same period in 2023, with gross margin improving to 90% from 89%[163] - Gross profit for the six months ended September 30, 2024 increased by $40.1 million (20%) compared to the same period in 2023, with gross margin improving to 90% from 88%[163] Research and Development Expenses - Research and development expense for the three months ended September 30, 2024 increased by $3.3 million (16%) compared to the same period in 2023, primarily due to a $2.9 million increase in stock-based compensation[166] - Research and development expense for the six months ended September 30, 2024 increased by $3.9 million (9%) compared to the same period in 2023, driven by a $4.3 million increase in stock-based compensation[167] Sales and Marketing Expenses - Sales and marketing expense for the three months ended September 30, 2024 increased by $4.2 million (14%) compared to the same period in 2023, primarily due to higher personnel-related expenses and advertising costs[153] - Sales and marketing expense for the three months ended September 30, 2024 increased by $4.2 million (14%) compared to the same period in 2023, driven by a $4.1 million increase in stock-based compensation and a $0.7 million increase in sales incentive compensation[168] - Sales and marketing expense for the six months ended September 30, 2024 increased by $5.0 million (8%) compared to the same period in 2023, driven by a $4.7 million net increase in stock-based compensation and a $1.7 million increase in sales incentive compensation[169] General and Administrative Expenses - General and administrative expense for the three months ended September 30, 2024 increased by $1.1 million (13%) compared to the same period in 2023, driven by higher compliance costs associated with being a publicly-traded company[154] - General and administrative expense for the three months ended September 30, 2024 increased by $1.1 million (13%) compared to the same period in 2023, primarily due to a $0.7 million increase in stock-based compensation and a $0.4 million increase in legal costs[170] - General and administrative expense for the six months ended September 30, 2024 increased by $1.1 million (6%) compared to the same period in 2023, primarily due to a $1.3 million increase in stock-based compensation and a $0.4 million increase in legal costs[171] Restructuring and Impairment - Restructuring and impairment charge for the three and six months ended September 30, 2024 was $2.3 million, a decrease of $5.6 million (71%) compared to the same periods in 2023, due to a sublease of office space in Irving, Texas[172] Other Income and Taxes - Other income, net for the three and six months ended September 30, 2024 increased by $3.1 million (53%) and $5.4 million (50%) respectively, driven by higher interest income from cash equivalents and marketable securities[174] - Provision for income taxes for the three and six months ended September 30, 2024 increased by $8.9 million (98%) and $14.6 million (96%) respectively, driven by higher income before taxes and decreased tax deductions from stock award activities[175] Cash and Marketable Securities - As of September 30, 2024, the company had $805.6 million in cash and cash equivalents and marketable securities, consisting of U.S. government and agency securities, corporate notes, and commercial paper[176] - As of September 30, 2024, the company had $184.2 million in cash and cash equivalents and $621.3 million in marketable securities, primarily in money market funds, corporate notes, and U.S. government securities[194] - A hypothetical 100 basis point increase in interest rates would decrease the market value of cash equivalents and marketable securities by $5.0 million and $3.4 million as of September 30, 2024 and March 31, 2024, respectively[196] Stock Repurchase Program - The company repurchased and retired 1,021,233 shares of Class A common stock under a $500 million repurchase program, with $470.0 million remaining authorized for repurchase as of September 30, 2024[178] Cash Flow Activities - Net cash provided by operating activities for the six months ended September 30, 2024 was $109.6 million, driven by net income of $85.5 million and non-cash items of $42.9 million, including $35.0 million in stock-based compensation[186] - Cash provided by investing activities was $67.2 million for the six months ended September 30, 2023, primarily from proceeds of $212.8 million from maturities of marketable securities and $37.5 million from sales of marketable securities, offset by $180.2 million in purchases and $2.7 million in software development costs[188] - Cash used in financing activities was $76.2 million for the six months ended September 30, 2024, mainly due to $74.2 million in common stock repurchases, $5.5 million in contingent consideration payments, and $8.2 million in taxes, partially offset by $10.2 million from stock option exercises and $1.4 million from employee stock purchase plan[188] - Cash used in financing activities was $186.9 million for the six months ended September 30, 2023, primarily from $186.2 million in common stock repurchases, $5.4 million in contingent consideration payments, and $4.1 million in taxes, partially offset by $7.2 million from stock option exercises and $1.5 million from employee stock purchase plan[189] Inflation Impact - The company does not believe inflation has had a material effect on its business, but significant inflationary pressures could harm its financial condition and results of operations if costs cannot be fully offset[197]