Doximity, Inc. 10-Q Summary: Q1 2026 (Ended June 30, 2025)
Business Context and Reporting Period
This filing covers the quarterly period ended June 30, 2025 (Q1 of Fiscal Year 2026). Doximity, Inc. operates the leading digital platform for U.S. medical professionals, serving over 80% of U.S. physicians. The company generates revenue primarily through Marketing, Hiring, and Workflow Solutions sold to pharmaceutical companies and health systems.
Key Financial Metrics
| Metric | Q1 2026 (Jun 30, 2025) | Q1 2025 (Jun 30, 2024) |
|---|---|---|
| Revenue | $145.9 million | $126.7 million |
| Gross Profit | $130.1 million | $113.1 million |
| Gross Margin | 89% | 89% |
| Net Income | $53.3 million | $41.4 million |
| Net Income Margin | 37% | 33% |
| Adjusted EBITDA | $79.8 million | $65.9 million |
| Adjusted EBITDA Margin | 55% | 52% |
| Free Cash Flow | $60.1 million | $39.5 million |
| Cash & Marketable Securities | $841.0 million | $N/A |
| Debt | None reported | None reported |
Material Changes vs. Prior Period
- Revenue Growth: Revenue increased 15% year-over-year, driven by a $17.9 million increase in subscription revenue. This was split between $4.8 million from new customers and $13.1 million from expansion of existing customers (average revenue per Marketing Solutions customer increased ~14%).
- Operating Expenses: Total operating expenses rose 13% to $75.6 million.
- R&D: Increased 19% ($4.2M) due to higher stock-based compensation and personnel costs.
- Sales & Marketing: Increased 3% ($1.1M), primarily due to stock-based compensation.
- G&A: Increased 34% ($3.2M), driven by stock-based compensation and higher legal/accounting fees.
- Other Income: Increased 35% to $9.6 million, largely due to higher interest income from the company's cash and marketable securities portfolio.
- Share Repurchases: The company repurchased 2.27 million shares for $122.4 million during the quarter. Approximately $301.7 million remains available under the current $500 million authorization.
Outlook, Risks, and Unusual Items
- Acquisition: In July 2025 (subsequent event), Doximity acquired Pathway Medical Inc., an AI-based medical knowledge platform, for $26 million in cash and issued $37 million in RSUs.
- Legal Proceedings: The company is defending against a securities class action lawsuit and five shareholder derivative lawsuits filed in April 2024 regarding disclosures of user counts and engagement rates. The company states it cannot estimate potential losses at this early stage.
- Tax Legislation: In July 2025, the "One Big Beautiful Bill Act" was signed, restoring Section 174 expensing for U.S. research. Management is evaluating the impact but does not expect a material change to the overall effective tax rate for the year.
- Guidance: The filing does not provide specific numerical guidance for future periods, noting that interim results are not necessarily indicative of full-year results.
Investor Verification Checklist
- Legal Exposure: Monitor the status of the securities litigation regarding user count disclosures and potential settlement costs.
- Customer Concentration: Verify the stability of the top 120 customers (those with >$500k TTM revenue), who accounted for 84% of revenue.
- Share Buyback Pace: Assess the impact of the aggressive $122.4 million quarterly buyback on future liquidity and capital allocation strategy.
- Integration of Pathway Medical: Evaluate the strategic fit and financial impact of the recent $26 million acquisition of Pathway Medical Inc.
- Stock-Based Compensation: Review the trend of increasing stock-based compensation ($21.9M this quarter vs $17.1M last year) and its effect on future GAAP margins.