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Doximity (DOCS -11%) wrapped up FY25 on a solid note for Q4 (Mar). However, this operator of a digital platform for medical professionals disappointed investors with downside revenue guidance for both Q1 (Jun) and FY26.

• Let's start with the good news. Its unique active users on a quarterly, monthly, weekly, and daily basis all hit fresh highs in Q4. This growth was again led by its newsfeed product, which is both its most used and most monetized product. Its unique newsfeed users hit record highs in Q4 while articles read or tapped were up more than 30% yr/yr. Its workflow tools (telehealth, fax, scheduling, AI tools) also hit fresh highs in Q4, with over 620,000 unique active prescribers.
• DOCS noted that FY25 revenue benefited from its strategic shift to more multi-module integrated offerings. This not only drove larger deal sizes, but also enabled a greater share of annual programs to launch in January. Also, it ended the quarter with 116 customers contributing at least $500,000 each in subscription-based revenue on a trailing 12-month basis. This is a roughly 17% yr/yr increase.
• Turning to the guidance, it seems to have been partly impacted by DOCS' shift to more multi-module integrated offerings, which have allowed many customers to get their annual programs live in January. While DOCS expects these earlier launches to be the norm going forward, FY25 received the benefit of being the transition year, leading to a few points of revenue growth upside.
• However, this dynamic creates a tougher comparison for FY26. The company noted that these earlier launches allow its customers to maintain an uninterrupted presence on the Doximity platform, which helps drive ROI and should translate into even greater investment on Doximity over time. Another concern is visibility. As of today, Doximity has just under 70% of its initial subscription-based revenue guidance under contract.
• Another factor appears to be the macro view. DOCS says it has not seen any impact from macro uncertainty, however, it thought it would be prudent to assume the market growth rate could be on the lower-end of this range.

Overall, it's clear that investors are disappointed in the guidance. Whenever a company makes an important change to its model, as it recently has done here with its multi-module integrated offerings, there can be a period of adjustment in terms of expected financial performance. Doximity is likely learning as well as to what to expect. Doximity's revenue-generating customers are primarily drug manufacturers and health systems. We suspect the recent EO from President Trump is impacting guidance as well.