Summary
Doximity closed fiscal 2023 with a mixed fourth quarter. Revenue in the quarter ended March 31, 2023 was $111.0 million, up 18.5% from $93.7 million in the prior-year quarter. Gross profit was $97.3 million, up 18.8%. Operating income rose 17.6% to $32.8 million. Net income fell 16.5% to $30.7 million from $36.7 million. Operating margin was 29.6%, down from 29.8%, while gross margin edged up to 87.7% from 87.4%. Deferred revenue was $105.4 million, up 24.1% from $85.0 million. For the full fiscal year, revenue was $419.1 million, up 22.0% from $343.5 million. Full-year gross profit was $365.6 million, up 20.3%. Operating income was $125.1 million, up 10.2%. Net income was $112.8 million, down 27.1% from $154.8 million. Diluted EPS was $0.53, down from $0.70.
The non-GAAP picture showed steadier profitability. Fourth-quarter adjusted EBITDA was $48.9 million, up 24% from $39.4 million, with an adjusted EBITDA margin of 44.1% versus 42.0%. Non-GAAP net income was $42.1 million versus $44.9 million, and non-GAAP net income margin was 38.0% versus 47.9%. Non-GAAP diluted EPS was $0.20 versus $0.21. For fiscal 2023, adjusted EBITDA was $184.0 million, up 22% from $150.3 million, and its margin was 43.9% versus 43.7%. Full-year non-GAAP net income was $154.9 million versus $180.6 million, with a 37.0% margin versus 52.6%. Non-GAAP diluted EPS was $0.73 versus $0.82. Operating cash flow was $46.6 million in the quarter, down 0.7% from $47.0 million, and $179.6 million for the full year, up 41.9% from $126.6 million. Free cash flow, a different measure, was $45.6 million in the quarter versus $44.9 million, and $173.4 million for the full year versus $120.9 million. Capital expenditures were $0.02 million in the quarter, down from $1.06 million, and $1.70 million for the full year, down from $1.91 million.
The business metrics pointed to durable engagement but slower expansion. Net revenue retention rate was 117% for fiscal 2023, compared with 157% for fiscal 2022 and 153% for fiscal 2021. The cohort of customers with at least $100,000 of revenue accounted for approximately 87% of revenue in fiscal 2023, and the network reaches more than 80% of U.S. physicians. Doximity said it had a record number of providers using its physician cloud in the fourth quarter for scheduling, fax, e-signature, and telehealth. It also named Craig Overpeck as SVP of commercial operations and Ben Greenberg as SVP of commercial products. Revenue growth came from a $70.4 million increase in subscription revenue, including $15.3 million from new subscription customers and $55.1 million from expansion of existing customers. Average revenue per existing Marketing Solutions customer increased 21%, and about 93% of fiscal 2023 revenue came from subscription customers. Management issued revenue and adjusted EBITDA guidance for the fiscal first quarter ending June 30, 2023, with adjusted EBITDA between $39.0 million and $40.0 million. For the fiscal year ending March 31, 2024, guidance calls for adjusted EBITDA between $216 million and $222 million.
Costs and risk factors deserve attention. Headcount growth was 24% in cost of revenue, 12% in research and development, 17% in sales and marketing, and 23% in general and administrative. The company completed a $70.0 million repurchase program, retiring 2,150,982 shares, and under a new $70.0 million authorization it repurchased 523,647 shares for $16.0 million, leaving $54.0 million available. Doximity flagged risks tied to macroeconomic uncertainty, the COVID-19 pandemic or other pandemics, retaining and adding members, attracting and retaining customers, prioritizing member interests, security breaches, and managing growth. The quarter's GAAP net income decline, despite revenue and adjusted EBITDA growth, shows how stock-based compensation, acquisition costs, and tax items can weigh on the bottom line even as the core platform expands.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2023 | Q3 FY2023 | QoQ | Q4 FY2022 | YoY |
|---|---|---|---|---|---|
| Revenue | $111.0M | $115.3M | -3.7% | $93.7M | +18.5% |
| Gross profit | $97.3M | $101.7M | -4.4% | $81.9M | +18.8% |
| Gross margin | 87.7% | 88.3% | -0.6 pp | 87.4% | +0.2 pp |
| Research & development | $21.5M | $20.5M | +5.0% | $17.4M | +23.6% |
| Sales & marketing | $33.1M | $33.2M | -0.2% | $25.9M | +28.0% |
| General & administrative | $9.8M | $9.5M | +2.6% | $10.6M | -8.3% |
| Total operating expenses | $64.4M | $63.3M | +1.9% | $54.0M | +19.4% |
| Operating income (loss) | $32.8M | $38.5M | -14.7% | $27.9M | +17.6% |
| Operating margin | 29.6% | 33.4% | -3.8 pp | 29.8% | -0.2 pp |
| Net income (loss) | $30.7M | $33.5M | -8.4% | $36.7M | -16.5% |
| Net margin | 27.6% | 29.0% | -1.4 pp | 39.2% | -11.6 pp |
| Diluted EPS | $0.14 | $0.16 | -$0.02 | $0.19 | -$0.05 |
Risks
Doximity states its revenue growth rate may decline and has already slowed, with revenue growing 22% in fiscal 2023 and 66% in fiscal 2022. It also expects to invest heavily in growth, which may increase expenses and cause margins to decline.
Net revenue retention rate declined to 117% for fiscal 2023 from 157% for fiscal 2022, and the metric reflects renewals, expansion, contraction, and churn. Doximity says if existing customers do not renew, renew on less favorable terms, or fail to purchase additional solutions, results could be materially harmed.
Doximity says customers may reduce spending on its solutions due to increased economic uncertainty, inflation, reduced discretionary spending, and the potential for a global recession. It also cites pressure for extended billing terms or pricing discounts.
Doximity expects increasing competition, including from large technology companies such as LinkedIn, Facebook, Google, and Twitter, and from telehealth providers such as American Well, Teladoc Health, and Zoom. Increased competition could cause pricing pressure, loss of market share, or decreased member engagement.
Doximity is subject to HIPAA as a Business Associate, evolving state privacy laws such as the CCPA and CPRA, and healthcare laws governing fee splitting, anti-kickback, and communications. Noncompliance could lead to significant fines, liability, required business changes, or reputational harm.
Revenue is relatively concentrated within a small number of key customers and marketing agencies. Although no customer accounted for 10% or more of total revenue in fiscal 2023 and 2022, one customer did so in fiscal 2021, and the sudden loss of a largest customer or agency could slow revenue growth.
Doximity sells marketing subscriptions across brands within pharmaceutical customers, and the loss of one or more significant brands could cause revenue to decline. It notes it has previously lost marketing spend and revenue when a pharmaceutical brand marketed on its platform lost patent protection.
Doximity says even if it attracts new customers and agencies, it may take several months or years for them to meaningfully increase spending, and larger pharmaceutical customers have brand-level budgets and decision makers. It may not leverage success into expanded business across other brands.
Doximity expects to invest heavily in growth, which may increase sales and marketing, research and development, and other expenses and cause margins to decline. Operating margin for fiscal 2023 was 29.9%, down 3.2 percentage points from fiscal 2022.
Doximity uses artificial intelligence and machine learning in many services and says these technologies present emerging ethical issues and potential government regulation. Controversy or regulation could cause brand or reputational harm, competitive harm, or legal liability.
Doximity depends on senior management and key personnel and faces intense competition for talent, especially in the San Francisco Bay Area. It cites competitive compensation packages and equity compensation, and the loss of key employees could impair execution.
Doximity's apps are distributed through third-party platforms such as the Apple App Store and Google Play App Store. Platform providers can change terms unilaterally, limit access, modify algorithms, or increase fees, which could harm its business.
The telehealth market is relatively new and unproven, and Doximity says it is uncertain whether it will achieve and sustain high levels of demand, consumer acceptance, and market adoption. If the market develops more slowly than expected or encounters negative publicity, growth could be harmed.
Doximity's dual class structure gives holders of Class B common stock, including executive officers and directors, approximately 86% of voting power as of March 31, 2023. This concentrated control limits other stockholders' ability to influence corporate matters.
Doximity has experienced seasonality in revenue and net income based on marketing program subscription launches and budgetary timing of purchases. This may cause fluctuations in operating results and make forecasting more difficult.
SaaS KPIs
All quarters →Adjusted EBITDA Margin
Free Cash Flow
Adjusted EBITDA
Net Revenue Retention
Non-GAAP Net Income Margin
Non-GAAP gross margin
Summary, forecast, risks and KPIs are extracted from Doximity, Inc.'s SEC filings for Q4 FY2023 (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.