Doximity Quarterly Earnings Preview

Doximity, Inc. (NYSE:DOCS) is a digital platform for medical professionals, offering tools for networking, telehealth, and news updates. Despite its innovative services, the stock is currently trading at $79.23, with a target price of $59.26. This indicates a potential downside of approximately 25.20%, leading to a pessimistic outlook from investment analysts.

In contrast, Veeva Systems Inc. (NYSE:VEEV), a cloud-computing company serving the life sciences industry, is trading at $237.20. It has a target price suggesting a potential upside of 21.52%. This positive growth potential makes Veeva Systems more attractive to investors compared to Doximity.

Other companies in the healthcare technology sector, such as Certara, Inc. (CERT), HealthEquity, Inc. (HQY), R1 RCM Inc. (RCM), and GE HealthCare Technologies Inc. (GEHC), also face negative growth potentials. Among them, American Well Corporation (AMWL) has the most significant downside at -99.99%, highlighting the challenges in this competitive market.

The stark contrast in growth potentials between Doximity and its peers, particularly Veeva Systems, underscores the varying investor sentiments within the healthcare technology sector. While some companies show promise, others face significant hurdles, impacting their stock performance and investor confidence.

Doximity (NYSE:DOCS) delivered a standout third-quarter performance, surpassing Wall Street expectations and driving its stock up more than 36% intra-day today. The digital platform for U.S. medical professionals saw strong revenue growth and impressive engagement metrics, reinforcing its momentum.

For the quarter, Doximity posted adjusted earnings per share of $0.45, significantly beating analysts’ projections of $0.34. Revenue surged 25% year-over-year to $168.6 million, exceeding the consensus estimate of $152.15 million.

The company also provided a bullish outlook. Fourth-quarter revenue is expected to range between $132.5 million and $133.5 million, well above analysts’ forecast of $123.8 million. For the full fiscal year 2025, Doximity anticipates revenue between $564.6 million and $565.6 million, significantly outpacing the consensus estimate of $540 million.

Growth in AI-driven tools played a key role in the company's success, with usage soaring 60% over the prior quarter. Additionally, Doximity’s newsfeed surpassed one million unique providers, signaling strong engagement among healthcare professionals.

With record user activity and a rapidly expanding suite of digital solutions, Doximity continues to solidify its position as a leading technology provider in the medical space, setting the stage for continued growth in 2025.

• Analysts have raised the consensus price target for Doximity, Inc. (NYSE:DOCS) from $44.94 to $54, reflecting optimism about the company's performance.
• Evercore ISI upgraded Doximity to a buy rating, highlighting stronger engagement metrics and deeper client relationships.
• Doximity's stock has surged 101% year-to-date, driven by a 20% year-over-year revenue growth in Q2 2025 and the adoption of new AI-powered features.

Doximity, Inc. (NYSE:DOCS) operates a cloud-based digital platform designed for medical professionals in the U.S. The platform offers tools for collaboration, patient care coordination, virtual visits, and career management. It primarily serves pharmaceutical manufacturers and healthcare systems, making it a key player in the digital healthcare sector.

Analysts have shown increasing optimism about Doximity's stock over the past year. The consensus price target rose from $44.94 last year to $54 last month. However, there was a slight decrease from the last quarter's $56.14 to the current $54, indicating a minor adjustment in expectations. This reflects analysts' evolving views on the company's performance and market conditions.

Evercore ISI recently upgraded Doximity to a buy rating, led by analyst Elizabeth Anderson, due to stronger engagement metrics and deeper client relationships. Despite a recent pullback in share price, Doximity reported a 20% year-over-year revenue growth in Q2 2025, surpassing management's guidance. This growth was driven by increased user adoption and higher revenue per user.

Doximity's stock has surged 101% year-to-date, with a 34% jump following its latest earnings report. Stephens initiated coverage with an Equal Weight rating and a $55 price target, noting the company's growth profile in low-to-mid-teens percentages. The self-serve marketplace and new products are expected to drive revenue growth, though Stephens remains cautious about modeling above-consensus growth.

Mizuho initiated coverage with a Neutral rating and a $55 price target, acknowledging volatility in quarterly top-line growth due to pharmaceutical digital ad spending. Despite challenges, Mizuho is confident in Doximity's potential for low double-digit annual revenue growth. The widespread adoption of Doximity's platform by over 80% of U.S. doctors solidifies its competitive position, supported by strong financial performance and new AI-powered features.

Goldman Sachs analysts initiated coverage on Doximity (NYSE:DOCS) with a Neutral rating and a price target on the stock of $58. The evaluation reflects a balanced outlook, acknowledging the company’s strong market position and growth potential while noting limited upside at current valuation levels.

Doximity operates in an attractive end-market, holding a leadership position that supports its long-term growth prospects. Goldman Sachs projected sustained industry performance of 6-7% annually, with Doximity expected to outpace the market, driving a 9-10% compound annual revenue growth rate (CAGR) from fiscal 2025 through fiscal 2028. The company’s ability to expand its core customer base and achieve its fiscal 2025 guidance, as well as outer-year revenue forecasts, was further reinforced by its strong performance in the second quarter of fiscal 2025.

In addition to revenue growth, Goldman Sachs highlighted a clear trajectory for EBITDA margin expansion. The analysts forecasted an increase of 180 basis points in margins from fiscal 2025 to fiscal 2028, reflecting operational efficiencies and strong execution. While Doximity’s fundamentals remain robust, the Neutral rating suggests that current valuation levels already account for much of its growth potential, leaving limited room for near-term upside.

On Thursday, May 16, 2024, Doximity, Inc. (NYSE:DOCS), a leading digital platform for U.S. medical professionals, reported its earnings after the market closed, revealing an earnings per share (EPS) of $0.202. This figure slightly exceeded the estimated EPS of $0.2, showcasing the company's ability to surpass market expectations. Additionally, the company's revenue reached $118.06 million, surpassing the expected $116.4 million. This performance not only highlights Doximity's financial health but also its continued growth in the competitive Zacks Medical Services industry.

Doximity's quarterly earnings of $0.25 per share exceeded the Zacks Consensus Estimate of $0.20 per share, marking a significant improvement from the $0.20 per share earned a year ago. This 25% earnings surprise continues the company's trend of surpassing consensus EPS estimates for the fourth consecutive quarter. Such consistent performance underscores Doximity's operational efficiency and its ability to exceed analyst expectations, reinforcing investor confidence in the company's financial management and growth strategy.

The company's revenue for the financial quarter ending March 2024 was $118.06 million, which not only surpassed the Zacks Consensus Estimate by 1.37% but also showed growth from the $110.97 million reported in the same period the previous year. This marks the fourth consecutive quarter that Doximity has exceeded consensus revenue estimates, demonstrating the company's strong market position and its ability to generate increased revenue streams. This growth is attributed to the company's innovative approach to integrating AI and automation into clinical workflows, which has attracted over 580,000 unique providers to utilize their tools in the last quarter.

Jeff Tangney, co-founder and CEO of Doximity, expressed satisfaction with the company's performance, highlighting strong profits and record engagement. The company's subscription revenue, a significant part of their income, rose by 9% year-over-year to $112.7 million from $103.2 million. Additionally, Doximity reported a net income of $40.6 million, up from $30.7 million in the prior year, marking a net margin increase to 34.4% from 27.6%. These financial highlights not only underscore Doximity's continued growth but also its successful efforts to enhance clinical workflows through technology.

Doximity's financial metrics, such as the price-to-earnings (P/E) ratio of approximately 30.04 and the price-to-sales (P/S) ratio of about 9.32, reflect the value investors place on the company's earnings and sales, respectively. The enterprise value to sales (EV/Sales) ratio of roughly 9.14 and the enterprise value to operating cash flow (EV/OCF) ratio of approximately 23.61 further indicate the company's valuation in relation to its sales and operating cash flow. With a minimal debt-to-equity (D/E) ratio of about 0.016 and a current ratio standing impressively at 6.20, Doximity showcases its financial stability and ability to cover its short-term liabilities with its short-term assets, positioning itself as a strong contender in the healthcare technology sector.

Despite surpassing analyst expectations for its Q1 results, Doximity’s (NYSE:DOCS) revised guidance downwards led to a more than 22% decline in its shares intra-day today.

For the first fiscal quarter, Doximity reported a profit of 19 cents per share, which came in above the expected 14 cents. The company's revenue grew by 20% year-over-year to $108.5 million, which exceeded the Street estimate of $107 million.

However, for the upcoming quarter, the company's revenue guidance stands at $109 million, falling short of the anticipated $121.3 million. Additionally, for 2024, Doximity has reduced its revenue outlook from the initial $503 million to now $460 million.

In another significant move, the company disclosed its intention to trim its current workforce, with plans to lay off around 100 employees, representing roughly 10% of its total workforce.