Insights 
VT 
Doximity recorded an impressive fiscal fourth-quarter 2025, with adjusted earnings per share of 38 cents, surpassing expectations by 40.7%. Compared to the previous year’s quarter, where earnings were 25 cents per share, there was a notable improvement.
The company’s fiscal 2025 adjusted earnings were $1.42 per share, marking a 49.5% increase year-over-year. GAAP net income per share rose to 31 cents, compared to 20 cents in the same quarter a year ago.
Strong Revenue Growth In Fiscal 2025
Revenues grew 17% year-over-year to $138.3 million, driven by subscription revenues of $131.9 million. The annual revenue for fiscal 2025 was $570.4 million, up 20%, with subscription revenues reaching $543.8 million, an increase of 21%.
Despite these achievements, DOCS shares fell 20.7% post-earnings release and 9.5% year-to-date. The broader S&P 500 Index saw a decrease of 0.3% in the same period.
Adjusted gross profits reached $126.5 million, with a gross margin of 91.4%. The company’s research and development, as well as sales and marketing expenses, rose significantly year-over-year.
Doximity’s cash and cash equivalents ended the quarter at $915.7 million, with total assets at $1.26 billion. For fiscal 2026, revenue guidance is between $619 million and $631 million, slightly below analyst expectations.
Future Guidance And Market Reaction
Doximity’s fourth-quarter results for fiscal 2025 came in well above what many had forecast, especially on the earnings front. The adjusted earnings per share (EPS) of 38 cents marked a steep jump not only from last year’s 25 cents but also beat consensus by more than 40%. Over the course of the year, adjusted EPS reached $1.42, which is roughly half again as much as the year before. On a standard GAAP basis, net income per share climbed to 31 cents, adding further confirmation of healthy underlying profitability.
Revenue also grew at a double-digit pace. The latest quarter posted sales of $138.3 million, which was up 17% from the same period last year. Almost all of that came from subscription-based services, which contributed a hefty $131.9 million. Looking at the yearly figures, total revenue climbed 20% to $570.4 million, again largely supported by subscription revenue, which on its own expanded by 21%.
Gross profitability remained strong, with adjusted gross profit standing at $126.5 million. That translates to a 91.4% gross margin, indicating the firm continues to operate with enviable efficiency. However, there’s more to the story. Research and development spending, alongside outlays for sales and marketing, both rose considerably compared to the previous year. These increases likely reflect internal efforts to extend the platform, though they can also weigh on net margins if not carefully managed.
Despite all that, the share price took a sharp turn. Since the earnings were published, the stock dropped more than 20%, adding to a 9.5% decline over the year. During that same time, the S&P 500 shed just 0.3%, suggesting the market punished the stock far more than broader sentiment would justify. The reaction may stem from the forward guidance.
For the year ahead, management expects revenue somewhere between $619 million and $631 million. While still showing growth, this figure landed shy of what many had modelled. It would seem the market is more focused on future momentum rather than past performance. The thermal shift in investor appetite often arrives when high-growth firms move into a phase where growth moderates, and competition intensifies.
Taking this into consideration, the stretched valuations customary to high-margin subscription models appear to be undergoing a stress test. Near-term price action implies expectations have now reset somewhat lower. From our side, positioning ahead of potential sentiment reversals should be based on shorter-dated implied volatility readings, which are still digesting the post-earnings gap. Recent spikes create an opportunity to reassess strike selection and expiry timing.
Where we’ve previously focused attention on long gamma plays around predictable earnings beats, the surprise now lies in how quickly market sentiment can shift, even in the face of solid operational execution. As trading vehicles, options presently reflect a repricing of execution risk rather than business model integrity. That distinction matters, given how implied volatility may stay elevated even as realised price movement narrows.
In practical terms, this means we should look more to rangebound structures in the very short term, possibly neutral or even slightly bearish bias, hedged tightly. The longer-dated term structure has risen, creating opportunities for calendar or diagonal spreads, should new positioning be warranted. Careful monitoring of further guidance updates, especially during the next earnings cycle, will be key here.
