Executive Summary
Doximity reported a strong start to fiscal 2026 (QQ1), with revenue of $145.9 million, up 15% year over year and beating the upper end of guidance by a modest margin. Non-GAAP gross margin remained elevated at 91%, and adjusted EBITDA reached $79.8 million for a 55% margin, underscoring the company’s ability to scale profitability even as AI investments accelerate. The quarter featured meaningful strategic milestones: (1) the launch of Doximity AI Scribe, growing to over 10,000 beta testers with thousands of patient notes generated, (2) the integration of Pathway, a Montreal AI clinical reference startup, into the Doximity GPT platform, and (3) the rapid development of an AI ecosystem centered on physician productivity (Scribe, GPT, Pathway). Management framed AI as the company’s “third act,” following the Newsfeed (network) and Workflow (practice tools) epics, with deepening clinician engagement and higher ROI for pharma and health systems evident through portal-driven upsell and broad-based momentum across SMB, health systems, and pharma channels. In Q1, net revenue retention was 118%, top customers retained aggressively (NRR for top 20 customers 119%), and 120 customers contributed at least $500k in subscription revenue, representing ~84% of total revenue. Free cash flow was $60.1 million, up 52% YoY, and the company deployed $122.3 million in share repurchases, with $302 million remaining under the current program. Looking ahead, Doximity maintained guidance for FY2026: revenue of $628–$636 million (about 11% growth at midpoint) and adjusted EBITDA of $341–$349 million (55% margin). For Q2, the company guided to $157–$158 million of revenue and $87–$88 million of adjusted EBITDA (about 56% margin). While policy uncertainty remains an overhang, management notes that bookings have continued to run stronger than initially anticipated, reflecting broad-based demand for the expanded product portfolio and AI-enabled workflow enhancements.
Key Performance Indicators
QoQ: -14.63% | YoY:28.86%
QoQ: -15.15% | YoY:27.27%
Key Insights
Revenue: $145.9M, up 15% YoY and +5.5% QoQ; Gross profit: $130.1M, gross margin non-GAAP 91%; Operating income: $54.5M, margin 37.4%; EBITDA: $66.9M, margin 45.9%; Adjusted EBITDA: $79.8M, margin 55%; Net income: $53.3M, net income margin 36.5%; EPS (diluted): $0.27; Weighted shares: 201.2M diluted; Net cash provided by operating activities: $62.1M; Free cash flow: $60.1M; Cash, cash equivalents and marketable securities: ~$841M; Net cash position: approx. $125.4M (net debt negative); RPO/Contra...
Financial Highlights
Revenue: $145.9M, up 15% YoY and +5.5% QoQ; Gross profit: $130.1M, gross margin non-GAAP 91%; Operating income: $54.5M, margin 37.4%; EBITDA: $66.9M, margin 45.9%; Adjusted EBITDA: $79.8M, margin 55%; Net income: $53.3M, net income margin 36.5%; EPS (diluted): $0.27; Weighted shares: 201.2M diluted; Net cash provided by operating activities: $62.1M; Free cash flow: $60.1M; Cash, cash equivalents and marketable securities: ~$841M; Net cash position: approx. $125.4M (net debt negative); RPO/Contracted revenue: 70%+ under contract earlier in year; Net Revenue Retention (trailing 12 months): 118%; Top customers contributing ≥$500k annualized: 120 (≈84% of revenue). Guidance: Q2 revenue $157–$158M (+15% YoY at midpoint), Q2 Adj EBITDA $87–$88M (~56% margin); FY revenue $628–$636M (midpoint +11%), FY Adj EBITDA $341–$349M (~55% margin). Pathway acquisition: $26M cash upfront, up to $37M equity, no revenue contribution in FY2026; incremental OpEx ~+$2M in FY2026; stock-based compensation expected to rise to the high-teens % of revenue in 2026–2027 before returning to mid-teens in 2028; share repurchases ongoing; Scribe: >75% of users return weekly; Pathway integrated into Doximity GPT; Scribe to be embedded in telehealth workflows.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
145.91M |
15.19% |
5.51% |
| Gross Profit |
130.12M |
15.02% |
5.09% |
| Operating Income |
54.52M |
18.38% |
11.99% |
| Net Income |
53.32M |
28.86% |
-14.63% |
| EPS |
0.28 |
27.27% |
-15.15% |
Management Commentary
Management highlighted AI as the 'third act' for Doximity, building a cohesive AI suite (Scribe, DocsGPT, Pathway) to answer clinical questions within workflows. Jeff Tangney described Scribe as a 'game changer' and emphasized physician control and HIPAA privacy. Anna Bryson noted broad-based strength across SMB, health systems, and pharma, with a focus on integrating multi-module programs and the client portal to drive ROI in upsell cycles. The company emphasized high ROI for pharma spend on digital channels via the Portal, which has driven >100% YoY bookings growth in SMB. Pathway was described as an AI-driven clinical reference corpus with a rapid integration into Doximity GPT, delivering higher accuracy and speed for doctors. Several questions underscored the potential monetization of AI tools through enterprise subscriptions (as with Dialer), ongoing AI investments, and cost dynamics of Scribe and Pathway as scale increases. The CFO reiterated that Q1 bookings were robust, and the guidance for the back half reflects a measured approach given policy uncertainty, while still assuming continued momentum across modules.
AI tools could be our third act here.
— Jeffrey A. Tangney
Scribe may have even saved her marriage.
— A grateful primary care physician (transcript quote)
Forward Guidance
Near-term: Q2 revenue guidance of $157–$158M (midpoint +15% YoY) and Adjusted EBITDA of $87–$88M (~56% margin) indicates continued scale advantages from an expanding product suite and AI investments. Full-year guidance: revenue range of $628–$636M (midpoint 11% growth) and Adj EBITDA of $341–$349M (55% margin). The delta between strong Q1 profitability and investment in AI (Pathway, Scribe, DocsGPT) implies a deliberate push to monetize AI capabilities through enterprise offerings (longer-term). The Pathway acquisition adds minimal near-term revenue but modest OpEx (~$2M in 2026) and expands the data corpus and AI capabilities, potentially enabling higher-quality answers and faster product adoption. Risks include policy uncertainty (e.g., DTC/pharma/SaaS spending shifts) and potential margin pressure from ongoing R&D and content/licensing costs associated with AI. Key factors for investors to monitor: (i) uptake of Scribe and DocsGPT across telehealth and ambulatory settings; (ii) enterprise monetization trajectory for AI tools (potential subscription revenue similar to Dialer); (iii) retention and expansion within pharma, SMB, and health systems driven by the client portal ROI insights; (iv) ongoing capital efficiency given a strong FCF profile and buyback activity.