Doximity, Inc. (DOCS)
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Earnings Call: Q3 2025

Feb 6, 2025

Anna Bryson
CFO, Doximity

Welcome to Doximity's fiscal 2025 third quarter earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session, and if you would like to ask a question during this time, please press star one on your telephone keypad. I would now like to turn the conference over to Perry Gold, Investor Relations. You may begin.

Perry Gold
Head of Investor Relations, Doximity

Thank you, Operator. Hello and welcome to Doximity's fiscal 2025 third quarter earnings call. With me on the call today are Jeff Tangney, co-founder and CEO of Doximity; Dr. Nate Gross, co-founder and CSO; and Anna Bryson, CFO. A complete disclosure of our results can be found in our press release issued earlier today, as well as in our related Form 8-K, along with a copy of our prepared remarks, all available on our website at investors.doximity.com. As a reminder, today's call is being recorded, and a replay will be available on our website. As part of our comments today, we will be making forward-looking statements. These statements are based on management's current views, expectations, and assumptions, and are subject to various risks and uncertainties. Actual results may differ materially, and we disclaim any obligation to update any forward-looking statements or outlook.

Please refer to the risk factors in our annual report on Form 10-K, any subsequent Form 10-Qs, and any of the reports and filings with the SEC that may be filed from time to time, including our upcoming filing on Form 10-Q. Our forward-looking statements are based on assumptions that we believe to be reasonable as of today's date, February 6th, 2025. Of note, it is Doximity's policy to neither reiterate nor adjust the financial guidance provided on today's call unless it is also done through a public disclosure such as a press release or through the filing of a Form 8-K. Today, we will discuss certain non-GAAP metrics that we believe aid in the understanding of our financial results. A historical reconciliation to comparable GAAP metrics can be found in today's earnings release.

Finally, during the call, we may offer incremental metrics to provide greater insights into the dynamics of our business. These details may be one-time in nature, and we may or may not provide updates on these metrics in the future. I would now like to turn the call over to our CEO and co-founder, Jeff Tangney. Jeff?

Jeff Tangney
Co-founder and CEO, Doximity

Thanks, Perry, and thank you, everyone, for joining our third quarter earnings call. We have three updates today: our financials, network growth, and commercial highlights. First, our top line. We delivered $169 million in revenue for the third quarter of our fiscal 2025, which represents 25% year-on-year growth and a 10% beat from the high end of our guidance range. Of note, our top 20 clients once again grew the fastest for us, up 122% on a trailing 12-month basis. These clients are the largest, most sophisticated pharma companies who employ entire teams of analysts to measure their marketing effectiveness. We believe our continued growth with them is proof of our value to the broader marketplace. Our bottom line was also strong in Q3, with a record adjusted EBITDA margin of 61%, or $102 million, which was up 39% year-on-year and 21% above the high end of our guidance.

So just two years after our first quarter with nine figures in revenue, we've now achieved nine figures in Adjusted EBITDA. So that's our Q3 financial highlights: a 10% beat, a 5% raise, and 61% margins. Okay, turning now to our network growth and engagement. Our unique active users on a quarterly, monthly, and weekly basis all hit fresh highs in Q3, with double-digit % growth year-on-year. Our News Feed usage continued to lead the way for us. For the first time ever in Q3, more than one million unique active prescribers scrolled our feed to stay current on the latest news in their fields. Our workflow tools also hit new highs in Q3, with over 610,000 unique active prescribers. As a reminder, our workflow tools include our telehealth, fax, scheduling, and AI tools.

Our AI tools grew the fastest in Q3, with over 1.8 million prompts, up 60% over the prior quarter. Finally, for the fourth year in a row, Doximity has earned the vaunted number one best-in-class telehealth video platform by health system CIOs and their staff, outperforming Microsoft Teams, Zoom and many others. We're now proud to serve over 250 health systems and hospital clients in delivering telehealth care to their patients. In short, our network engagement has never been stronger. As healthcare shifts to be more digital, more mobile, and more AI-powered, we're proud to be leading the way. Okay, turning now to our Q3 commercial highlights. We're pleased to report strong calendar year-end sales, led by three initiatives: our new products, integrated programs, and client portal. First, our new point-of-care and formulary products grew over 100% in Q3, generating over 20% of our pharmaceutical sales.

As a reminder, these modules appear outside of our news feed and represent entirely new inventory for us. Second, with our newer integrated programs, clients can leverage our data science to create a custom-tailored dynamic approach for each doctor. For example, some doctors prefer scientific deep dives on Monday evenings. Others prefer bullet-point guidelines in between patient visits. Letting our clients personalize and optimize their campaigns across our many modules helped us grow our program sizes in Q3. Finally, our client portal is weaving all of this together by providing our clients a single, trusted place to test strategies and see their results. Our seamless third-party prescription data gives our clients real insights and proof of impact, solidifying our role as a strategic partner. Now, as we've said before, our client portal is a multi-year initiative. Today, over half of our brand clients have access.

Our plan is to add all of our clients in 2025. We also added agencies to the mix last quarter, signing 10 as portal partners. We'll do our inaugural training summit with them in New York later this month. Together, we're excited to bring consumer-grade marketing tools to healthcare. Okay, I'd like to end by thanking my Doximity teammates who continue to work incredibly hard to realize our mission to better healthcare. I personally have never been more excited or more proud about what we're building together. And with that, I'll hand it over to our CFO, Anna Bryson, to discuss our financials and guidance. Anna?

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