Total revenues of $126.7 million, up 17%
year-over-year Net income growth of 46% and adjusted EBITDA growth
of 42% year-over-year
Doximity, Inc. (NYSE: DOCS), the leading digital platform for
U.S. medical professionals, today announced results of its fiscal
2025 first quarter ended June 30, 2024.
“We were pleased to deliver strong profits and record engagement
last quarter, as we beat on both our top and bottom lines,” said
Jeff Tangney, co-founder and CEO of Doximity. “Last quarter, a
record 590,000 unique providers used our AI, telehealth, messaging,
and scheduling workflow tools to save time and better serve their
patients.”
Fiscal 2025 First Quarter Financial Highlights
All comparisons, unless otherwise noted, are to the three months
ended June 30, 2023.
- Revenue: Revenue of $126.7 million, versus $108.5
million, an increase of 17% year-over-year.
- Net income and non-GAAP net income: Net income of $41.4
million, versus $28.4 million, representing a margin of 32.7%,
versus 26.2%. Non-GAAP net income of $55.9 million, versus $40.6
million, representing a margin of 44.1%, versus 37.5%.
- Adjusted EBITDA: Adjusted EBITDA of $65.9 million,
versus $46.6 million, an increase of 42% year-over-year,
representing adjusted EBITDA margins of 52.0%, versus 42.9%.
- Diluted net income per share and non-GAAP diluted net income
per share: Diluted net income per share was $0.21, versus
$0.13, while non-GAAP diluted net income per share was $0.28,
versus $0.19.
- Operating cash flow and free cash flow: Operating cash
flow of $41.2 million, versus $57.2 million, a decrease of 28%
year-over-year, and free cash flow of $39.5 million, versus $55.6
million, a decrease of 29% year-over-year.
Financial Outlook
Doximity is providing guidance for its fiscal second quarter
ending September 30, 2024 as follows:
- Revenue between $126.5 million and $127.5 million.
- Adjusted EBITDA between $62.5 million and $63.5 million.
Doximity is providing guidance for its fiscal year ending March
31, 2025 as follows:
- Revenue between $514 million and $523 million.
- Adjusted EBITDA between $248.5 million and $257.5 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)
June 30, 2024
March 31, 2024
Assets
Current assets:
Cash and cash equivalents
$
111,442
$
96,785
Marketable securities
639,046
666,115
Accounts receivable, net
120,910
101,332
Prepaid expenses and other current
assets
37,068
48,709
Total current assets
908,466
912,941
Property and equipment, net
12,869
12,318
Deferred income tax assets
44,742
45,068
Operating lease right-of-use assets
11,852
12,332
Intangible assets, net
26,256
27,317
Goodwill
67,940
67,940
Other assets
1,333
1,458
Total assets
$
1,073,458
$
1,079,374
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
1,656
$
2,253
Accrued expenses and other current
liabilities
28,488
43,703
Deferred revenue, current
102,943
99,145
Operating lease liabilities, current
2,190
2,149
Total current liabilities
135,277
147,250
Deferred revenue, non-current
116
211
Operating lease liabilities,
non-current
11,841
12,397
Contingent earn-out consideration
liability, non-current
5,349
10,895
Other liabilities, non-current
7,295
7,224
Total liabilities
159,878
177,977
Stockholders' Equity
Preferred stock
—
—
Common stock
186
187
Additional paid-in capital
841,470
823,885
Accumulated other comprehensive loss
(1,008
)
(2,664
)
Retained earnings
72,932
79,989
Total stockholders’ equity
913,580
901,397
Total liabilities and stockholders’
equity
$
1,073,458
$
1,079,374
DOXIMITY, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except per
share data)
(unaudited)
Three Months Ended June
30,
2024
2023
Revenue
$
126,676
$
108,469
Cost of revenue(1)
13,550
13,153
Gross profit
113,126
95,316
Operating expenses(1):
Research and development
22,574
21,931
Sales and marketing
35,244
34,455
General and administrative
9,255
9,247
Total operating expenses
67,073
65,633
Income from operations
46,053
29,683
Other income, net
7,116
4,839
Income before income taxes
53,169
34,522
Provision for income taxes
11,792
6,116
Net income
$
41,377
$
28,406
Net income per share attributable to Class
A and Class B common stockholders:
Basic
$
0.22
$
0.15
Diluted
$
0.21
$
0.13
Weighted-average shares used in computing
net income per share attributable to Class A and Class B common
stockholders:
Basic
185,610
194,521
Diluted
199,224
212,355
(1) Costs and expenses include stock-based
compensation expense as follows (in thousands):
Three Months Ended June
30,
2024
2023
Cost of revenue
$
2,894
$
2,461
Research and development
4,684
3,256
Sales and marketing
6,586
5,995
General and administrative
2,926
2,289
Total stock-based compensation expense
$
17,090
$
14,001
DOXIMITY, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended June
30,
2024
2023
Cash flows from operating
activities
Net income
$
41,377
$
28,406
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
2,562
2,604
Stock-based compensation, net of amounts
capitalized
17,090
14,001
Non-cash lease expense
481
537
Accretion of discount on marketable
securities, net
(2,360
)
(299
)
Net loss on sale of marketable
securities
—
273
Amortization of deferred contract
costs
2,726
2,667
Change in fair value of contingent
earn-out consideration liability
202
269
Other
(738
)
(421
)
Changes in operating assets and
liabilities:
Accounts receivable
(19,372
)
14,032
Prepaid expenses and other assets
10,460
2,589
Deferred contract costs
(1,431
)
(1,210
)
Accounts payable, accrued expenses and
other liabilities
(12,942
)
677
Deferred revenue
3,704
(6,922
)
Operating lease liabilities
(516
)
(3
)
Net cash provided by operating
activities
41,243
57,200
Cash flows from investing
activities
Purchases of property and equipment
—
(70
)
Internal-use software development
costs
(1,704
)
(1,494
)
Purchases of marketable securities
(170,413
)
(35,284
)
Maturities of marketable securities
202,058
116,649
Sales of marketable securities
—
37,525
Net cash provided by investing
activities
29,941
117,326
Cash flows from financing
activities
Proceeds from issuance of common stock
upon exercise of stock options
2,551
3,285
Taxes paid related to net share settlement
of equity awards
(2,394
)
(1,964
)
Repurchase of common stock
(51,214
)
(21,755
)
Payment of contingent consideration
related to a business combination
(5,470
)
(5,390
)
Net cash used in financing
activities
(56,527
)
(25,824
)
Net increase in cash and cash
equivalents
14,657
148,702
Cash and cash equivalents, beginning of
period
96,785
158,027
Cash and cash equivalents, end of
period
$
111,442
$
306,729
Supplemental disclosures of cash flow
information
Cash paid for taxes, net of refunds
$
12,907
$
—
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, and change in fair
value of contingent earn-out consideration liability 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, 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 June
30,
2024
2023
(unaudited)
(in thousands, except
percentages)
Net income
$
41,377
$
28,406
Adjusted to exclude the following:
Stock-based compensation
17,090
14,001
Depreciation and amortization
2,562
2,604
Provision for income taxes
11,792
6,116
Change in fair value of contingent
earn-out consideration liability
202
269
Other income, net
(7,116
)
(4,839
)
Adjusted EBITDA
$
65,907
$
46,557
Revenue
$
126,676
$
108,469
Net income margin
32.7
%
26.2
%
Adjusted EBITDA margin
52.0
%
42.9
%
Three Months Ended June
30,
2024
2023
(unaudited)
(in thousands)
Net cash provided by operating
activities
$
41,243
$
57,200
Purchases of property and equipment
—
(70
)
Internal-use software development
costs
(1,704
)
(1,494
)
Free cash flow
$
39,539
$
55,636
Other cash flow components:
Net cash provided by investing
activities
$
29,941
$
117,326
Net cash used in financing activities
$
(56,527
)
$
(25,824
)
Three Months Ended June
30,
2024
2023
(unaudited)
(in thousands, except per
share data and percentages)
GAAP cost of revenue
$
13,550
$
13,153
Adjusted to exclude the following:
Stock-based compensation
(2,894
)
(2,461
)
Amortization of acquired intangibles
—
(137
)
Non-GAAP cost of revenue
$
10,656
$
10,555
GAAP gross profit
$
113,126
$
95,316
Adjusted to exclude the following:
Stock-based compensation
2,894
2,461
Amortization of acquired intangibles
—
137
Non-GAAP gross profit
$
116,020
$
97,914
GAAP gross margin
89.3
%
87.9
%
Non-GAAP gross margin
91.6
%
90.3
%
GAAP research and development expense
$
22,574
$
21,931
Adjusted to exclude the following:
Stock-based compensation
(4,684
)
(3,256
)
Non-GAAP research and development
expense
$
17,890
$
18,675
GAAP sales and marketing expense
$
35,244
$
34,455
Adjusted to exclude the following:
Stock-based compensation
(6,586
)
(5,995
)
Amortization of acquired intangibles
(1,061
)
(1,061
)
Change in fair value of contingent
earn-out consideration liability
(202
)
(269
)
Non-GAAP sales and marketing expense
$
27,395
$
27,130
GAAP general and administrative
expense
$
9,255
$
9,247
Adjusted to exclude the following:
Stock-based compensation
(2,926
)
(2,289
)
Non-GAAP general and administrative
expense
$
6,329
$
6,958
GAAP operating expense
$
67,073
$
65,633
Adjusted to exclude the following:
Stock-based compensation
(14,196
)
(11,540
)
Amortization of acquired intangibles
(1,061
)
(1,061
)
Change in fair value of contingent
earn-out consideration liability
(202
)
(269
)
Non-GAAP operating expense
$
51,614
$
52,763
GAAP operating income
$
46,053
$
29,683
Adjusted to exclude the following:
Stock-based compensation
17,090
14,001
Amortization of acquired intangibles
1,061
1,198
Change in fair value of contingent
earn-out consideration liability
202
269
Non-GAAP operating income
$
64,406
$
45,151
GAAP net income
$
41,377
$
28,406
Adjusted to exclude the following:
Stock-based compensation
17,090
14,001
Amortization of acquired intangibles
1,061
1,198
Change in fair value of contingent
earn-out consideration liability
202
269
Income tax effect of non-GAAP adjustments
(1)
(3,854
)
(3,248
)
Non-GAAP net income
$
55,876
$
40,626
Non-GAAP net income margin
44.1
%
37.5
%
Weighted-average shares used in computing
net income per share attributable to Class A and Class B common
stockholders:
Basic
185,610
194,521
Diluted
199,224
212,355
Non-GAAP net income per share attributable
to Class A and Class B stockholders:
Basic
$
0.30
$
0.21
Diluted
$
0.28
$
0.19
(1)
For the three months ended June 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/20240808776516/en/
Investor Relations Contact: Perry Gold
ir@doximity.com
Media Contact: Amanda Cox pr@doximity.com
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