Doximity, Inc. (DOCS) reported fiscal third‑quarter results for the period ended December 31, 2025, on February 5, 2026. Revenue rose 10% year‑over‑year to $185.1 million, while net income climbed to $61.6 million, giving a 33% net‑income margin. Adjusted earnings per share were $0.46, beating the consensus estimate of $0.44 by $0.02, or 4.5%.
The earnings beat was driven by record engagement across the company’s core product lines. The newsfeed attracted more than one million quarterly active prescribers, the workflow suite grew to 720,000 users, and nascent AI products reached 300,000 users. However, the company’s gross margin slipped from 93% to 91% because of a 27% increase in marketing spend and a significant investment in AI infrastructure, which also contributed to a slight compression of the adjusted EBITDA margin from 60.5% to 60.2%.
Revenue growth was supported by a 12% increase in the commercial segment, largely from higher usage of AI‑enabled tools, while the government segment grew 8% as new contracts were signed. Net revenue retention reached 112%, underscoring the stickiness of the platform. The company’s AI initiatives are still in the early monetization phase, so the current revenue mix remains heavily weighted toward subscription and professional services.
Guidance for the fiscal fourth quarter was lowered to $143.5 million, below the consensus of $151.3 million, and the full‑year 2026 revenue outlook was trimmed to $642.5 million–$643.5 million, shy of the $645.4 million consensus. Management cited delayed pharmaceutical budgets, policy uncertainty around “Most Favored Nation” agreements, and the need to fund AI infrastructure as the primary reasons for the cautious outlook. The company maintained its full‑year profit guidance, indicating confidence that the current margin compression will be temporary.
CEO Jeff Tangney highlighted the platform’s growing usefulness, noting that “the addition of AI features has made us more useful than ever.” He also warned that “client uncertainty” from late‑signed government pricing agreements has caused major pharmaceutical customers to postpone upfront spending. Acting CFO Tim Cabral said the company expects the deferred budgets to become available later in the year, and that the company’s share‑repurchase program authorizing up to $500 million demonstrates confidence in its balance sheet.
After the earnings release, the market reacted sharply. Investors focused on the lower‑than‑expected Q4 revenue guidance and the full‑year outlook, which fell short of consensus. The stock fell 33% in after‑hours trading, reflecting concerns about near‑term growth deceleration, while the share‑repurchase program was seen as a sign of long‑term confidence.
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