Doximity(US:DOCS)2024-02-09 01:50Financial Data and Key Metrics Changes - The company raised its fiscal 2024 annual revenue guidance midpoint by $8 million or 2%, and its EBITDA guidance midpoint by 6% to $225 million, representing a 47% margin [7][32] - Q3 revenue grew to $135.3 million, up 17% year-over-year, exceeding the high end of the guidance range [30] - The net revenue retention rate was 115% on a trailing 12-month basis, with the top 20 customers showing a higher rate of 122% [30] Business Line Data and Key Metrics Changes - New modules, including Peer-to-Peer, Point-of-Care, and Formulary, grew over 100% year-over-year during the upfront season [13][16] - The company reported strong performance in modules outside traditional marketing budgets, indicating a shift in customer spending [12][13] Market Data and Key Metrics Changes - The company expects the market to grow roughly 5% to 7% in calendar year 2024, with confidence in outperforming this growth [18][73] - The company noted a more condensed upsell season compared to the previous year, affecting budget allocations [77] Company Strategy and Development Direction - The next phase of growth is anticipated to be AI-fueled, with a focus on enhancing the workflow platform and integrating new technologies [9][10] - The company is excited about the potential of its client portal to unlock new customer segments and improve sales efficiency [20][23] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong performance in Q3 and the potential for continued growth, despite macroeconomic uncertainties [73][88] - The company is focused on maintaining a high-tech and high-touch relationship with clients, ensuring personalized service while leveraging technology [144][148] Other Important Information - The company has repurchased $262 million worth of shares, reducing fully diluted shares outstanding by approximately 6% [12] - The gross margin reached a record non-GAAP level of 93%, driven by revenue outperformance and cost optimization [31][65] Q&A Session All Questions and Answers Question: What are the key factors for share gains relative to budgets? - Management believes that continued investment in newer modules and their packaged approach will drive share gains, despite market growth expectations of 5% to 7% [18][40] Question: Can you discuss the portal's readiness for purchasing? - The portal is currently being used by 10% of customers, with positive feedback. Management plans to gradually roll it out to more clients while ensuring a smooth transition [20][22] Question: How does the company view the market growth in fiscal '25? - Management indicated that while the market growth rate remains uncertain, they are optimistic about their ability to gain share based on strong customer investment [73][92] Question: What is the impact of the new modules on legacy products? - New modules are expected to unlock new budgets and are not seen as cannibalizing legacy products, as they offer more interactive solutions [47][125] Question: How is the company addressing the sales relationship with the portal? - The company aims to maintain a balance between high-tech solutions and high-touch service, ensuring clients can access data easily while still receiving personalized support [144][148]