Doximity(DOCS) - 2025 Q3 - Quarterly Results

Doximity Fiscal 2025 Third Quarter Financial Results Financial Highlights & Outlook Doximity reported strong Q3 FY2025 financial results, including significant revenue and net income growth, and provided positive future guidance Fiscal 2025 Third Quarter Financial Highlights Doximity achieved significant Q3 FY2025 year-over-year growth in revenue, net income, Adjusted EBITDA, diluted EPS, and free cash flow | Financial Metric | Q3 FY2025 (in millions) | Q3 FY2024 (in millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Revenue | $168.6M | $135.3M | 25% | | Net Income | $75.2M | $48.0M | 57% | | Adjusted EBITDA | $102.0M | $73.3M | 39% | | Diluted Net Income per Share | $0.37 | $0.24 | 54% | | Operating Cash Flow | $65.2M | $50.1M | 30% | | Free Cash Flow | $63.4M | $48.7M | 30% | - The company achieved record engagement in Q3, with over 610,000 unique providers using its clinical workflow tools[2] - AI tools experienced the fastest growth, increasing 60% over the prior quarter, while the newsfeed surpassed one million unique providers[2] Financial Outlook Doximity provided Q4 FY2025 and updated full fiscal year 2025 revenue and Adjusted EBITDA guidance | Guidance for Q4 FY2025 | Range (in millions) | | :--- | :--- | | Revenue | $132.5M - $133.5M | | Adjusted EBITDA | $62.5M - $63.5M | | Updated Guidance for Full Year FY2025 | Range (in millions) | | :--- | :--- | | Revenue | $564.6M - $565.6M | | Adjusted EBITDA | $306.6M - $307.6M | Consolidated Financial Statements Consolidated financial statements reveal a robust financial position with increased assets, strong revenue and net income growth, and robust operating cash flow Condensed Consolidated Balance Sheets Doximity's balance sheet as of December 31, 2024, shows increased total assets, decreased liabilities, and a substantial rise in stockholders' equity | Balance Sheet Item | Dec 31, 2024 (in thousands) | Mar 31, 2024 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $165,270 | $96,785 | | Total current assets | $1,012,703 | $912,941 | | Total assets | $1,172,157 | $1,079,374 | | Total liabilities | $141,037 | $177,977 | | Total stockholders' equity | $1,031,120 | $901,397 | Condensed Consolidated Statements of Operations For the three and nine months ended December 31, 2024, Doximity reported significant year-over-year increases in revenue and net income | Income Statement (Three Months Ended Dec 31) | 2024 (in thousands) | 2023 (in thousands) | | :--- | :--- | :--- | | Revenue | $168,603 | $135,284 | | Gross Profit | $154,422 | $123,094 | | Income from operations | $79,925 | $58,551 | | Net income | $75,196 | $47,956 | | Diluted EPS | $0.37 | $0.24 | | Income Statement (Nine Months Ended Dec 31) | 2024 (in thousands) | 2023 (in thousands) | | :--- | :--- | :--- | | Revenue | $432,111 | $357,365 | | Net income | $160,727 | $106,964 | Condensed Consolidated Statements of Cash Flows For the nine months ended December 31, 2024, operating cash flow significantly increased, with financing activities primarily involving stock repurchases | Cash Flow (Nine Months Ended Dec 31) | 2024 (in thousands) | 2023 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $174,778 | $120,152 | | Net cash provided by (used in) investing activities | $(4,825) | $107,356 | | Net cash used in financing activities | $(101,468) | $(262,446) | | Net increase (decrease) in cash | $68,485 | $(34,938) | Non-GAAP Financial Measures & Key Metrics Doximity uses non-GAAP financial measures and key business metrics to provide a comprehensive view of its operational performance Explanation of Non-GAAP Measures Doximity defines its key non-GAAP measures, including Adjusted EBITDA and free cash flow, to clarify their calculation and purpose - Adjusted EBITDA is defined as net income before interest, income taxes, depreciation, and amortization, and further adjusted for stock-based compensation expense, change in fair value of contingent earn-out consideration liability, restructuring and impairment charges, and other income, net[16] - Free cash flow is calculated as cash flow from operating activities less purchases of property and equipment and internal-use software development costs[16] Key Business Metrics Doximity tracks net revenue retention rate and high-value customer count as key business metrics to evaluate growth and scale - Net revenue retention rate is calculated using trailing 12-month (TTM) subscription-based revenue from customers who also had revenue in the prior TTM period, reflecting renewals, expansion, contraction, and churn[17] - The number of customers with TTM subscription revenue exceeding $500,000 is a key indicator of the scale of the business[17] Reconciliation of GAAP to Non-GAAP Financial Measures Q3 FY2025 reconciliation highlights Adjusted EBITDA and non-GAAP net income, with stock-based compensation as a primary adjustment | Reconciliation (Three Months Ended Dec 31, 2024) | Amount (in thousands) | | :--- | :--- | | Net income (GAAP) | $75,196 | | Stock-based compensation | $19,368 | | Depreciation and amortization | $2,655 | | Provision for income taxes | $14,644 | | Other adjustments | $(9,825) | | Adjusted EBITDA | $102,038 | | Reconciliation (Three Months Ended Dec 31, 2024) | Amount (in thousands) | | :--- | :--- | | Net income (GAAP) | $75,196 | | Stock-based compensation | $19,368 | | Amortization of acquired intangibles | $1,061 | | Other adjustments & tax effect | $(4,219) | | Non-GAAP net income | $91,406 | Company Information Doximity, a leading digital platform for U.S. medical professionals, offers collaboration and practice management tools, with forward-looking statements subject to risks - Doximity's network includes more than 80% of U.S. physicians across all specialties and practice areas[5] - The company's mission is to help doctors be more productive so they can provide better care for their patients by offering digital tools for collaboration, news, career management, and virtual visits[5] - The press release contains forward-looking statements that are subject to risks and uncertainties, including economic conditions, ability to retain members and customers, and security measures[6]