Why Did Doximity Plunge 22.16%? Disappointing Outlook

On May 16, 2025, Doximity's stock experienced a significant drop of 22.16% in pre-market trading.

Doximity's stock plummeted after the telehealth software company released a disappointing outlook for the upcoming quarter and full year. The company's revenue projections for the quarter ending June 30 were between $139 million and $140 million, while full-year revenue was expected to range from $619 million to $631 million. Both ranges fell short of analysts' expectations, leading to a sharp decline in investor confidence.

Despite reporting better-than-expected fourth-quarter earnings and revenue, Doximity's shares tumbled due to the company's weak guidance for the future. The company's fiscal fourth-quarter sales rose 17% to $138.3 million, with subscription revenue increasing by a similar percentage. However, the disappointing outlook overshadowed these positive results, causing the stock to drop significantly.

Doximity's CEO, Jeff Tangney, highlighted the company's record engagement and strong profits in the fiscal year 2025. However, the market's focus on the company's forward guidance, which was below Wall Street's expectations, led to the stock's decline. This situation underscores the importance of meeting or exceeding market expectations in maintaining investor confidence and stock performance.