Summary
Doximity reported revenue of $97.9 million for the fiscal 2022 third quarter ended December 31, 2021, up 66.7% from the prior-year quarter. Net income was $55.6 million, up 222.9%, and diluted EPS was $0.26, up 420.0%. Operating income reached $35.8 million, up 99.5%, and gross profit was $86.8 million, up 70.7%. Gross margin was 88.7%, up 2.1 percentage points, while operating margin was 36.6%, up 6.0 percentage points. For the first nine months of fiscal 2022, revenue was $249.9 million, up 78.2%, and net income was $118.1 million, up 311.0%.
The customer base kept expanding. Doximity's net revenue retention rate was 171%, against 145% a year earlier. Customers with at least $100,000 of trailing 12-month subscription revenue grew to 258, and that cohort accounted for approximately 89% of revenue for the trailing 12 months ended December 31, 2021. The company said its telehealth platform grew to 350,000 active providers, and it agreed to acquire Amion, which powers nearly 200,000 physician schedules. For existing Marketing Solutions customers, average revenue per customer increased 60%, while the average number of modules and brands per customer increased 13% and 11%, respectively. Roughly 93% of revenue in the quarter came from subscription customers.
Profitability improved on both a GAAP and non-GAAP basis. Adjusted EBITDA was $47.0 million, up 119% from $21.5 million, with an adjusted EBITDA margin of 48% against 37%. Non-GAAP net income was $63.6 million, compared with $19.5 million, for a 65% margin. Operating cash flow rose to $27.3 million from $24.0 million, and free cash flow was $25.6 million, compared with $22.9 million. For the first nine months of fiscal 2022, operating cash flow was $79.6 million, up 75.3%. Capital expenditures were $0.6 million in the quarter. Deferred revenue, current portion, was $65.6 million as of December 31, 2021.
Expenses rose across the board. Management reported headcount growth of about 36% in cost of revenue, 28% in research and development, 24% in sales and marketing, and 54% in general and administrative. It pointed to stock-based compensation, public company insurance costs, and a U.S. News warrant as drivers of higher costs. The quarter also included a tax benefit tied to stock option activity after the June 2021 initial public offering.
Management gave fiscal fourth quarter guidance for the quarter ending March 31, 2022, with revenue guidance of $89.0 million to $90.0 million and adjusted EBITDA guidance of $34.0 million to $35.0 million. For the full fiscal year ending March 31, 2022, the company updated revenue guidance to $338.9 million to $339.9 million and adjusted EBITDA guidance to $144.9 million to $145.9 million. Preliminary guidance for the fiscal year ending March 31, 2023 calls for revenue growth of about 33% excluding the Amion acquisition, to approximately $450 million, and an adjusted EBITDA margin of 40% or greater excluding Amion. Doximity listed the COVID-19 pandemic, its ability to retain or add members, its ability to attract and retain customers, security breaches, competition, and managing growth among the risks that could affect results. The company also carries new commitments, including an amended U.S. News agreement with a total minimum guarantee of $9.1 million over the initial three years, a web hosting arrangement with an annual commitment of $5.2 million starting January 1, 2022, and an Irving, Texas lease with total undiscounted payments of $17.9 million. Doximity said its existing cash and marketable securities should support working capital and capital expenditure requirements for at least the next 12 months.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q3 FY2022 | Q2 FY2022 | QoQ | Q3 FY2021 | YoY |
|---|---|---|---|---|---|
| Revenue | $97.9M | $79.3M | +23.3% | — | — |
| Gross profit | $86.8M | $70.4M | +23.3% | — | — |
| Gross margin | 88.7% | 88.7% | -0.0 pp | — | — |
| Research & development | $16.2M | $15.5M | +4.9% | — | — |
| Sales & marketing | $25.7M | $21.2M | +21.4% | — | — |
| General & administrative | $9.1M | $8.8M | +2.9% | — | — |
| Total operating expenses | $51.0M | $45.4M | +12.2% | — | — |
| Operating income (loss) | $35.8M | $25.0M | +43.4% | — | — |
| Operating margin | 36.6% | 31.4% | +5.1 pp | — | — |
| Net income (loss) | $55.6M | $36.1M | +54.2% | — | — |
| Net margin | 56.9% | 45.5% | +11.4 pp | — | — |
| Diluted EPS | $0.26 | $0.17 | +$0.09 | — | — |
Risks
The COVID-19 pandemic has accelerated the shift of pharmaceutical marketing budgets to online solutions and increased demand for telehealth, but these trends may not continue. If customers reallocate budgets back to in-person marketing, growth could decline. The Omicron variant and vaccine uncertainty add further unpredictability, and the full extent of the impact on the business remains unknown.
Increasing competition in the market for medical professionals and marketing, hiring, and telehealth solutions. Competitors include large technology companies like LinkedIn, Facebook, Google, and Twitter, as well as telehealth providers such as American Well, Teladoc Health, and Zoom Video Communications. Increased competition could cause pricing pressure, loss of market share, or decreased member engagement.
Revenue is relatively concentrated within a small number of key customers. For the nine months ended December 31, 2021, one customer accounted for 10% or more of total revenue. The loss of or renegotiation with any largest customer could slow revenue growth. Additionally, reliance on pharmaceutical brands means the loss of a significant brand due to patent expiration could cause revenue to decline.
Rapid growth strains management, operations, systems, and internal controls. Revenue grew 67% and 78% for the three and nine months ended December 31, 2021, and full-time equivalent headcount increased from 713 at March 31, 2021 to 850 at December 31, 2021. Failure to manage growth effectively could damage reputation, limit growth, and negatively affect operating results.
Stringent and changing laws related to privacy, data protection, and healthcare regulation, including HIPAA (as a Business Associate), CCPA/CPRA, and potential GDPR compliance. Penalties for noncompliance could be significant. Additionally, state fee-splitting and anti-kickback laws may affect arrangements with healthcare professionals, and regulatory changes to telehealth reimbursement could impact usage.
Dependence on senior management and key personnel, with intense competition for talent in the San Francisco Bay Area and healthcare/technology industries. Fluctuations in the stock price may make it more difficult or costly to use equity compensation to motivate and retain employees, and the company may incur significant costs to attract and retain talent.
The telehealth market is immature and volatile, and increased demand during the COVID-19 pandemic may decline. If the market does not develop as expected, or if states do not maintain reimbursement parity after the pandemic, usage of the network could be negatively impacted. The success of Telehealth Solutions depends on member willingness to use the tools and on demonstrating value to employers, health plans, and government agencies.
The 'physicians first' philosophy may cause the company to forgo certain expansion or revenue opportunities that are not in the best interests of members, even if negatively impacting operating results. This philosophy may also cause disagreements with existing or prospective customers.
SaaS KPIs
All quarters →Adjusted EBITDA Margin
Free Cash Flow
Adjusted EBITDA
Net Revenue Retention
Summary, forecast, risks and KPIs are extracted from Doximity, Inc.'s SEC filings for Q3 FY2022 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 1, 2026.