Categories: News

Doximity Announces Fourth Quarter and Fiscal Year 2022 Financial Results

Q4 total revenues of $93.7 million, up 40% year-over-year
Q4 net income margin of 39% and adjusted EBITDA margin of 42%

Fiscal Year 2022 total revenues of $343.5 million, up 66% year-over-year
Fiscal year 2022 net income margin of 45% and adjusted EBITDA margin of 44%

SAN FRANCISCO, May 17, 2022 /PRNewswire/ — Doximity, Inc. (NYSE: DOCS), the leading digital platform for U.S. medical professionals, today announced results for the fiscal 2022 fourth quarter and fiscal year ended March 31, 2022.

“We’re proud to now serve over 2 million US healthcare professionals, including over 80% of US physicians and over 50% of Physician Assistants and Nurse Practitioners,” said Jeff Tangney, co-founder & CEO at Doximity. “This quarter, we added scheduling to our product suite with the acquisition of Amion, and saw record use of our fax, e-signature, and telehealth tools.”

Fiscal 2022 Fourth Quarter Financial Highlights

All comparisons, unless otherwise noted, are to the three months ended March 31, 2021.

  • Revenue: Revenue of $93.7 million, versus $66.7 million, an increase of 40% year-over-year.
  • Net income and non-GAAP net income: Net income of $36.7 million, versus $21.5 million, representing a 39% margin. Non-GAAP net income of $44.9 million, versus $24.0 million, representing a 48% margin.
  • Adjusted EBITDA: Adjusted EBITDA of $39.4 million, versus $26.7 million, an increase of 47% year-over-year, representing adjusted EBITDA margins of 42%, versus 40%.
  • Net income per share and non-GAAP net income per share: Diluted net income per share was $0.17, versus $0.07, while non-GAAP diluted net income per share was $0.21, versus $0.09.
  • Operating cash flow and free cash flow: Operating cash flow of $47.0 million, versus $37.6 million, and free cash flow of $44.9 million, versus $36.6 million.

Fiscal Year 2022 Financial Highlights

All comparisons, unless otherwise noted, are to the fiscal year ended March 31, 2021.

  • Revenue: Revenue of $343.5 million, versus $206.9 million, an increase of 66% year-over-year.
  • Net income and non-GAAP net income: Net income of $154.8 million, versus $50.2 million, representing a 45% margin. Non-GAAP net income of $180.6 million, versus $57.2 million, representing a 53% margin.
  • Adjusted EBITDA: Adjusted EBITDA of $150.3 million, versus $64.8 million, an increase of 132% year-over-year, representing adjusted EBITDA margins of 44%, versus 31%.
  • Net income per share and non-GAAP net income per share: Diluted net income per share was $0.70, versus $0.23, while non-GAAP diluted net income per share was $0.82, versus $0.26.
  • Operating cash flow and free cash flow: Operating cash flow of $126.6 million, versus $83.0 million, and free cash flow of $120.9 million, versus $78.4 million.

Financial Outlook

Doximity is providing guidance for its fiscal first quarter ending June 30, 2022 as follows:

  • Revenue between $88.6 million and $89.6 million.
  • Adjusted EBITDA between $28.6 million and $29.6 million.

Doximity is updating guidance for its fiscal year ending March 31, 2023 as follows:

  • Revenue between $454.0 million and $458.0 million.
  • Adjusted EBITDA between $192.0 million and $196.0 million.

Stock Repurchase Program

The board of directors of Doximity authorized a new stock repurchase program to acquire up to $70 million of the Company’s Class A common stock, commencing in the first quarter of fiscal 2023. The repurchases are  expected to be executed from time to time over the next 12 months, subject to general business and market conditions and other investment opportunities, through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans.

Conference Call Information

Doximity will host a webcast today at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) to discuss these financial results. To listen to a live audio webcast, please visit the Company’s Investor Relations page at https://investors.doximity.com. The archived webcast will be available on the Company’s Investor Relations page shortly after the call.

About Doximity

Founded in 2010, Doximity is the leading digital platform for medical professionals. The company’s network members include over 80% of U.S. physicians across all specialties and practice areas. Doximity provides its verified clinical membership with digital tools built for medicine, enabling them to collaborate with colleagues, stay up to date with the latest medical news and research, manage their careers, and conduct virtual patient visits. Doximity’s mission is to help doctors be more productive so they can provide better care for their patients. For more information, please visit www.doximity.com.

Forward-Looking Statements

Statements we make in this press release may include statements which are not historical facts and are considered forward-looking within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act, which are usually identified by the use of words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “seeks,” “should,” “will,” and variations of such words or similar expressions. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act and are making this statement for purposes of complying with those safe harbor provisions. These forward-looking statements reflect our current views about our plans, intentions, expectations, strategies and prospects, which are based on the information currently available to us and on assumptions we have made.  Although we believe that our plans, intentions, expectations, strategies and prospects as reflected in or suggested by those forward-looking statements are reasonable, we can give no assurance that the plans, intentions, expectations, or strategies will be attained or achieved.  Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors including (i) the timing and scope of anticipated stock repurchases; (ii)  the impact of the COVID-19 pandemic (including the impact to our industry or on our customers’ industries, impact on general economic conditions, and government responses, restrictions, and actions related to the pandemic); (iii) our ability to retain existing members or add new members to our platform and maintain or grow their engagement with our platform; (iv) our ability to attract new customers or retain existing customers; (v) the impact of our prioritization of our members’ interests; (vi) breaches in our security measures or unauthorized access to members’ data; (vii) our ability to maintain or manage our growth, and other risks and factors that are beyond our control including, without limitation, those set forth in the section entitled “Risk Factors” in the prospectus for our offering of shares of Class A common stock shares that was filed with the SEC on June 25, 2021, and in our Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2021, as such risk factors may be updated from time to time in our periodic filings with the SEC. Additional information will be provided in our Annual Report on Form 10-K for the  annual period ended March 31, 2022. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could cause actual results to differ materially from those contained in our forward-looking statements. The forward-looking statements made in this press release relate only to management’s beliefs and assumptions as of this date. We assume no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Investor Relations Contact:
Perry Gold
ir@doximity.com

Media Contact:
pr@doximity.com

 

DOXIMITY, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
 
(unaudited)

As of March 31,

2022

2021

Assets

Current assets:

Cash and cash equivalents

$                    112,809

$                      66,393

Marketable securities

685,304

76,141

Accounts receivable, net

81,073

50,319

Prepaid expenses and other current assets

19,439

10,692

Deferred contract costs, current

5,512

5,856

Total current assets

904,137

209,401

Property and equipment, net

8,488

7,598

Deferred income tax assets

48,558

2,112

Operating lease right-of-use assets

1,087

1,339

Intangible assets, net

7,909

9,596

Goodwill

18,915

18,915

Other assets

2,263

2,758

Total assets

$                    991,357

$                    251,719

Liabilities, Redeemable Convertible Preferred Stock, and Stockholders’
Equity

Current liabilities:

Accounts payable

$                            463

$                        1,515

Accrued expenses and other current liabilities

25,270

16,285

Deferred revenue, current

84,907

83,272

Operating lease liabilities, current

642

970

Total current liabilities

111,282

102,042

Deferred revenue, non-current

78

220

Operating lease liabilities, non-current

447

284

Other liabilities, non-current

956

972

Total liabilities

112,763

103,518

Redeemable Convertible Preferred Stock

Redeemable convertible preferred stock

81,458

Stockholders’ Equity

Preferred stock

Common stock

192

83

Additional paid-in capital

702,589

30,357

Accumulated other comprehensive loss

(15,294)

(21)

Retained earnings

191,107

36,324

Total stockholders’ equity

878,594

66,743

Total liabilities, redeemable convertible preferred stock, and stockholders’ 
     equity

$                    991,357

$                    251,719

 

DOXIMITY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)

Three Months Ended
March 31,

Fiscal Year Ended March
31,

2022

2021

2022

2021

Revenue

$       93,653

$       66,687

$     343,548

$     206,897

Cost of revenue(1)

11,765

7,993

39,787

31,196

Gross profit

81,888

58,694

303,761

175,701

Operating expenses(1):

Research and development

17,424

12,558

62,350

43,873

Sales and marketing

25,899

17,586

92,129

62,033

General and administrative

10,644

5,703

35,746

16,492

Total operating expenses

53,967

35,847

190,225

122,398

Income from operations

27,921

22,847

113,536

53,303

Other income (expense), net

(16)

38

469

4,466

Income before income taxes

27,905

22,885

114,005

57,769

Provision for (benefit from) income taxes

(8,821)

1,402

(40,778)

7,559

Net income

$       36,726

$       21,483

$     154,783

$       50,210

Undistributed earnings attributable to participating securities

(13,846)

(21,526)

(28,654)

Net income attributable to Class A and Class B common 
     stockholders, basic and diluted

$       36,726

$         7,637

$     133,257

$       21,556

Net income per share attributable to Class A and Class B common 
     stockholders:

Basic

$           0.19

$           0.10

$           0.82

$           0.29

Diluted

$           0.17

$           0.07

$           0.70

$           0.23

Weighted-average shares used in computing net income per share 
     attributable to Class A and Class B common stockholders:

Basic

191,579

79,672

163,484

74,342

Diluted

215,862

103,644

191,017

95,134

(1) Costs and expenses include share-based compensation expenses as follows:

Three Months Ended
March 31,

Fiscal Year Ended March
31,

2022

2021

2022

2021

Cost of revenue

$         2,006

$            232

$         4,979

$            600

Research and development

2,201

796

7,065

1,975

Sales and marketing

2,533

694

8,108

1,998

General and administrative

3,069

1,148

11,290

2,679

Total stock-based compensation expense

$         9,809

$         2,870

$       31,442

$         7,252

 

 

DOXIMITY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
 
(unaudited)

Three Months Ended
March 31,

Fiscal Year Ended March
31,

2022

2021

2022

2021

Cash flows from operating activities

Net income

$       36,726

$       21,483

$     154,783

$       50,210

Adjustments to reconcile net income to net cash provided by operating 
     activities:

Depreciation and amortization

1,368

991

5,040

3,702

Deferred income taxes

(9,275)

914

(41,247)

4,987

Stock-based compensation, net of amounts capitalized

9,809

2,870

31,442

7,252

Non-cash lease expense

302

421

1,159

2,433

Amortization of premium on marketable securities, net

1,469

139

4,332

197

Loss on sale of marketable securities

708

1,231

Amortization of deferred contract costs

2,389

2,186

9,755

6,883

Gain on sale of business

(4,698)

Other

288

631

410

403

Changes in operating assets and liabilities, net of effect of acquisition:

Accounts receivable

(11,439)

(5,965)

(31,017)

(20,452)

Prepaid expenses and other assets

(2,086)

(2,003)

(9,089)

(1,833)

Deferred contract costs

(2,937)

(3,414)

(9,609)

(9,384)

Accounts payable, accrued expenses and other liabilities

571

644

8,664

7,285

Deferred revenue

19,367

19,198

1,828

38,571

Operating lease liabilities

(296)

(544)

(1,107)

(2,583)

Net cash provided by operating activities

46,964

37,551

126,575

82,973

Cash flows from investing activities

Purchases of property and equipment

(1,060)

(147)

(1,912)

(245)

Internal-use software development costs

(1,049)

(766)

(3,785)

(4,365)

Purchases of marketable securities

(45,278)

(44,481)

(1,317,193)

(78,880)

Maturities of marketable securities

6,302

2,537

47,919

40,537

Sales of marketable securities

16,864

633,802

Cash paid for acquisition, net of cash acquired

(31,682)

Proceeds from sale of business

4,230

Other

595

(12)

595

(12)

Net cash used in investing activities

(23,626)

(42,869)

(640,574)

(70,417)

Cash flows from financing activities

Proceeds from issuance of common stock upon initial public offering after
deducting underwriting discounts and commissions

553,905

Proceeds from issuance of common stock upon exercise of stock options

3,378

4,475

12,612

8,897

Proceeds from issuance of common stock in connection with the employee
stock purchase plan

1,395

1,395

Taxes paid related to net share settlement of equity awards

(381)

(817)

Repurchase of common stock

(1,652)

(2,698)

(2,022)

Payments for deferred offering costs

(1,087)

(3,982)

(1,468)

Net cash provided by financing activities

4,392

1,736

560,415

5,407

Net increase (decrease) in cash and cash equivalents

27,730

(3,582)

46,416

17,963

Cash and cash equivalents, beginning of period

85,079

69,975

66,393

48,430

Cash and cash equivalents, end of period 

$     112,809

$       66,393

$     112,809

$       66,393

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with accounting principles generally accepted in the United States (“GAAP”), the Company uses the following non-GAAP measures of financial performance:

  • Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP net income, non-GAAP net income margin, and non-GAAP basic and diluted net income per common share: We exclude the effect of stock-based compensation expense, amortization of acquired intangible assets, and expenses associated with acquisitions from non-GAAP gross profit, non-GAAP gross margin and non-GAAP operating income. Non-GAAP net income and non-GAAP net income margin are further adjusted for estimated income tax on such adjustments. We calculate income taxes on the adjustments by applying an estimated annual effective tax rate to the adjustments. Non-GAAP basic and diluted net income per common share is non-GAAP net income attributable to common stockholders divided by the weighted average number of shares. For both basic and diluted non-GAAP net income per share, the weighted average shares we use in computing non-GAAP net income per share is equal to our GAAP weighted average shares. Non-GAAP gross margin represents non-GAAP gross profit as a percentage of revenue and non-GAAP net income margin represents non-GAAP net income as a percentage of revenue.
  • Adjusted EBITDA and adjusted EBITDA margin: We define adjusted EBITDA as net income before interest, income taxes, depreciation, and amortization, and as further adjusted for acquisition and other related expenses, stock-based compensation expense, and other income, net. Adjusted EBITDA margin represents adjusted EBITDA as a percentage of revenue.
  • Free cash flow: We calculate free cash flow as cash flow from operating activities less purchases of property and equipment and capitalized internal-use software development cost.

We use these non-GAAP financial measures internally for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP. Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business. Please see the tables included at the end of this release for the reconciliation of GAAP to non-GAAP results.

Key Business Metrics

  • Net revenue retention rate: We calculate net revenue retention rate by taking the trailing 12-month, or TTM, subscription-based revenue from our customers that had revenue in the prior TTM period and dividing that by the total subscription-based revenue for the prior TTM period. Our net revenue retention rate compares our subscription revenue from the same set of customers across comparable periods, and reflects customer renewals, expansion, contraction, and churn.
  • Customers with trailing 12-month subscription revenue greater than $100,000 and $1 million: We calculate the number of customers with TTM product revenue greater than $100,000 and $1 million by counting the number of customers that contributed more than $100,000 and $1 million in subscription revenue in the TTM period. The number of customers with TTM subscription-based revenue of at least $100,000 and $1 million is a key indicator of the scale of our business. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity.

Reconciliation of GAAP to Non-GAAP Financial Measures

The following tables reconcile the specific items excluded from GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:

Three Months Ended
March 31,

Fiscal Year Ended March
31,

2022

2021

2022

2021

(unaudited)

(in thousands)

Net income

$   36,726

$   21,483

$ 154,783

$   50,210

Adjusted to exclude the following:

Acquisition and other related expenses

254

26

254

496

Stock-based compensation

9,809

2,870

31,442

7,252

Depreciation and amortization

1,368

991

5,040

3,702

Provision for (benefit from) income taxes

(8,821)

1,402

(40,778)

7,559

Other income (expense), net

16

(38)

(469)

(4,466)

Adjusted EBITDA

$   39,352

$   26,734

$ 150,272

$   64,753

Revenue

$   93,653

$   66,687

$ 343,548

$ 206,897

Net income margin

39     %

32     %

45     %

24     %

Adjusted EBITDA margin

42     %

40     %

44     %

31     %

Three Months Ended
March 31,

Fiscal Year Ended March
31,

2022

2021

2022

2021

(unaudited)

(in thousands)

Net cash provided by operating activities

$       46,964

$       37,551

$     126,575

$       82,973

Purchases of property and equipment

(1,060)

(147)

(1,912)

(245)

Internal-use software development costs

(1,049)

(766)

(3,785)

(4,365)

Free cash flow

$       44,855

$       36,638

$     120,878

$       78,363

Other cash flow components:

Net cash used in investing activities

$     (23,626)

$     (42,869)

$   (640,574)

$     (70,417)

Net cash provided by financing activities

$         4,392

$         1,736

$     560,415

$         5,407

 

Three Months Ended
March 31,

Fiscal Year Ended March
31,

2022

2021

2022

2021

(unaudited)

(in thousands, except percentages)

GAAP cost of revenue

$   11,765

$     7,993

$   39,787

$   31,196

Adjusted to exclude the following:

Stock-based compensation

(2,006)

(232)

(4,979)

(600)

Non-GAAP cost of revenue

$     9,759

$     7,761

$   34,808

$   30,596

GAAP gross profit

$   81,888

$   58,694

$ 303,761

$ 175,701

Adjusted to exclude the following:

Stock-based compensation

2,006

232

4,979

600

Non-GAAP gross profit

$   83,894

$   58,926

$ 308,740

$ 176,301

GAAP gross margin

87     %

88     %

88     %

85     %

Non-GAAP gross margin

90     %

88     %

90     %

85     %

GAAP research and development expense

$   17,424

$   12,558

$   62,350

$   43,873

Adjusted to exclude the following:

Stock-based compensation

(2,201)

(796)

(7,065)

(1,975)

Non-GAAP research and development expense

$   15,223

$   11,762

$   55,285

$   41,898

GAAP sales and marketing expense

$   25,899

$   17,586

$   92,129

$   62,033

Adjusted to exclude the following:

Stock-based compensation

(2,533)

(694)

(8,108)

(1,998)

Amortization of acquired intangibles

(252)

(264)

(1,046)

(1,081)

Non-GAAP sales and marketing expense

$   23,114

$   16,628

$   82,975

$   58,954

GAAP general and administrative expense

$   10,644

$     5,703

$   35,746

$   16,492

Adjusted to exclude the following:

Acquisition and other related expenses

(254)

(26)

(254)

(496)

Stock-based compensation

(3,069)

(1,148)

(11,290)

(2,679)

Non-GAAP general and administrative expense

$     7,321

$     4,529

$   24,202

$   13,317

GAAP operating expense

$   53,967

$   35,847

$ 190,225

$ 122,398

Adjusted to exclude the following:

Acquisition and other related expenses

(254)

(26)

(254)

(496)

Stock-based compensation

(7,803)

(2,638)

(26,463)

(6,652)

Amortization of acquired intangibles

(252)

(264)

(1,046)

(1,081)

Non-GAAP operating expense

$   45,658

$   32,919

$ 162,462

$ 114,169

GAAP operating income

$   27,921

$   22,847

$ 113,536

$   53,303

Adjusted to exclude the following:

Acquisition and other related expenses

254

26

254

496

Stock-based compensation

9,809

2,870

31,442

7,252

Amortization of acquired intangibles

252

264

1,046

1,081

Non-GAAP operating income

$   38,236

$   26,007

$ 146,278

$   62,132

 

 

Three Months Ended
March 31,

Fiscal Year Ended
March 31,

2022

2021

2022

2021

(unaudited)

(in thousands, except per share data and
percentages)

GAAP net income

$  36,726

$  21,483

$  154,783

$  50,210

Adjusted to exclude the following:

Acquisition and other related expenses

254

26

254

496

Stock-based compensation

9,809

2,870

31,442

7,252

Amortization of acquired intangibles

252

264

1,046

1,081

Income tax effect of non-GAAP adjustments (1)

(2,166)

(664)

(6,876)

(1,854)

Non-GAAP net income

$  44,875

$  23,979

$  180,649

$  57,185

Non-GAAP net income margin

48     %

36     %

53     %

28     %

GAAP undistributed earnings attributable to participating securities

$          —

$ (13,846)

$ (21,526)

$ (28,654)

Impact on undistributed earnings attributable to participating
securities due to non-GAAP adjustments

(1,221)

(2,616)

(3,533)

Non-GAAP undistributed earnings attributable to participating
securities

$          —

$ (15,067)

$ (24,142)

$ (32,187)

Non-GAAP net income

$  44,875

$  23,979

$  180,649

$  57,185

Non-GAAP undistributed earnings attributable to participating
securities

(15,067)

(24,142)

(32,187)

Non-GAAP net income attributable to Class A and Class B
stockholders, basic and diluted

$  44,875

$     8,912

$  156,507

$  24,998

Weighted-average shares used in computing net income per share
attributable to Class A and Class B common stockholders:

Basic

191,579

79,672

163,484

74,342

Diluted

215,862

103,644

191,017

95,134

Non-GAAP net income per share attributable to Class A and Class B
stockholders:

Basic

$       0.23

$       0.11

$       0.96

$       0.34

Diluted

$       0.21

$       0.09

$       0.82

$       0.26

(1) For the three months and fiscal years ended March 31, 2022 and 2021, management used an estimated annual effective non-GAAP tax rate of 21.0%.

 

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SOURCE Doximity, Inc.

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