Doximity's Stock Soars as AI Integration Boosts Performance and User Engagement

Telehealth Platform Doximity Stock Soars as AI Boosts Performance

Shares of Doximity (DOCS) skyrocketed more than 30% Friday, a day after the telehealth software provider posted better-than-anticipated results and guidance as it added customers, boosted through the use of artificial intelligence (AI). The company posted fiscal 2025 third-quarter adjusted earnings per share (EPS) of $0.45, while analysts surveyed by Visible Alpha expected $0.34. Revenue increased almost 25% year-over-year to $168.6 million, also above forecasts. Co-founder and CEO Jeff Tangney said Doximity had "another quarter of record engagement in Q3, with over 610,000 unique providers using our clinical workflow tools." Tangney added that the company's AI offerings "grew the fastest last quarter, up 60% over the prior quarter, while our newsfeed surpassed more than one million unique providers." Doximity sees full-year adjusted EBITDA between $306.6 million and $307.6 million, with revenue of $564.6 million and $565.6 million. The Visible Alpha estimates were for $282.5 million and $497.5 million, respectively. Doximity shares surged 33% in recent trading to $77.53, their highest level since September 2021. They have nearly tripled in the last year.

Doximity Surpasses EPS, Revenue Goals | The Motley Fool

Doximity (DOCS 0.21%), a digital platform for U.S. medical professionals, released its fiscal third-quarter earnings on Feb. 6, 2025. The company reported impressive results, surpassing both analyst forecasts and its own guidance. It achieved a non-GAAP earnings per share (EPS) of $0.45, well above the estimate of $0.34. Revenue reached $168.6 million, compared to expectations of $152 million. Overall, it was a strong quarter performance. Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in 2024-11-07 earnings report. Doximity is a prominent digital platform catering to medical professionals in the U.S., featuring comprehensive tools and solutions designed to enhance productivity and communication. This includes telehealth features and AI-driven tools that boost clinical efficiency. The platform excels by connecting doctors through various mediums, supporting them with innovative tools. Recent focuses have centered around optimizing the user experience and scaling the engagement of its tools. With more than 2 million registered members, including a substantial number of U.S. physicians, Doximity leverages its network scale to drive growth. Critical success factors embody user engagement, streamlined workflows, and client partnerships, particularly impacting pharmaceutical and healthcare systems. Doximity's Q3 showed growth across multiple fronts. Revenue grew to $168.6 million, representing a 25% increase from last year and exceeding expectations by 10.5%. This growth was driven by enhanced user engagement and adoption of new AI-powered tools, as well as strategic client interactions. Notably, the platform's newsfeed saw significant activity with 1 million unique healthcare providers engaged, while usage of its AI tools rose 60% from the previous quarter. The company's net income jumped to $75.2 million, marking a 57% year-over-year increase. Margins also improved, with the gross margin reaching 91.6% and an adjusted EBITDA margin of 60.5%, underscoring efficient scaling and operational expertise. Strategic developments included bolstering its client portal, leading to increased subscriptions among pharmaceutical clients. Doximity's client engagement strategies significantly influenced strong financial metrics -- adjusted EBITDA amounted to $102 million, surpassing the prior guidance of $83 million to $84 million set by management. Doximity did face industry challenges, such as fierce competition in healthcare technology, and economic pressures that have the potential to affect client spending on marketing and hiring solutions. For the future, Doximity's management is optimistic, enhancing its fiscal year-end forecasts based on impressive Q3 outcomes. Updated guidance predicts revenue of $564.6 million to $565.6 million, along with an adjusted EBITDA ranging from $306.6 million to $307.6 million. This confidence stems from the continued positive trends in revenue diversification and operational efficiency.