Key Takeaways:
Shares of Doximity Inc. (NYSE: DOCS) plunged 19% in late trading after the telehealth company’s weak full-year revenue forecast overshadowed positive user growth and a quarterly revenue beat.
“We’re thrilled to announce that we reached a new engagement record of over 800,000 active prescribers using our workflow tools in Q4,” CEO Jeff Tangney said in the earnings release, highlighting the company's expanding user base and adoption of its new AI tools.
The company posted adjusted earnings of 26 cents a share for its fiscal fourth quarter, missing Wall Street’s expectation of 28 cents. Revenue grew 5% year-over-year to $145.4 million, narrowly beating the consensus call for $144 million. The primary driver for the sell-off was Doximity’s forward-looking guidance. Management forecast fiscal 2027 revenue between $664 million and $676 million, a significant miss compared to the $697.4 million analysts had projected.
The weak outlook raises questions about Doximity's growth trajectory, with shares having already fallen 47% this year. The guidance implies a marked deceleration, which investors weighed more heavily than the company's announcement of an integration with value-based care provider Aledade. For its fiscal first quarter, Doximity expects revenue of $151 million to $152 million, also below the $153.8 million Wall Street consensus.
The sharp decline in response to the guidance miss indicates investors are concerned about the company's ability to monetize its large user base effectively. Investors will now look to the first-quarter results for any signs of a turnaround or stabilization in the growth outlook.
This article is for informational purposes only and does not constitute investment advice.
