Doximity’s Q4 Surge: Why Healthcare Tech’s Hidden Gem Is Poised for Dominance

Doximity, a leading healthcare technology platform, delivered a Q4 2025 earnings report that underscored its position as a growth powerhouse in an industry ripe for disruption. With a 17% year-over-year revenue increase to $138.3 million, adjusted EBITDA margins hitting 50.4%, and a 119% net revenue retention rate, the company is proving its B2B subscription model is both sticky and scalable. For investors, this is no ordinary tech story—it’s a playbook for capturing outsized returns in a sector undergoing consolidation.

Subscriber Retention: The Engine of Enterprise Loyalty

Doximity’s 119% net revenue retention rate is a stark testament to its ability to lock in enterprise clients. Pharmaceutical giants, which account for 84% of total revenue, are increasingly adopting Doximity’s multi-module integrated programs. These programs—combining point-of-care tools, formulary insights, and AI-driven workflows—deliver a 122% net revenue retention rate among top clients. This “land and expand” strategy ensures customers deepen their investment over time, a rarity in healthcare tech where churn is a persistent risk.

The rollout of Doximity’s client portal (now used by over 50% of pharma brands) amplifies this flywheel. By providing real-time ROI analytics and enabling rapid campaign adjustments, the portal reduces friction for large clients while creating upsell opportunities. With plans to fully integrate all clients by 2025, this tool positions Doximity as an indispensable partner for pharma’s digital transformation.

Enterprise Expansion: Dominating a $20B+ Market

Doximity isn’t just retaining clients—it’s attracting them. The count of customers with $500,000+ in trailing-12-month revenue grew 21% year-over-year, now numbering 114. These top-tier clients are adopting Doximity’s full-suite offerings, which include telehealth platforms (voted “Best in Class” by CIOs) and AI tools that grew 60% sequentially in Q3.

The point-of-care and formulary modules—which now contribute 20% of pharma sales—are particularly transformative. Unlike legacy systems, Doximity’s modules integrate directly into clinical workflows, enabling physicians to access drug information at the point of decision-making. This has driven a 100% year-over-year growth in these segments, signaling early adoption in a market still in its infancy.

Margin Potential: The Undervalued Elephant in the Room

While revenue growth is impressive, Doximity’s margin profile is its most underappreciated asset. The company’s adjusted EBITDA margin expanded to 55% in FY2025, outpacing peers like Veeva Systems (48%) and Zoom (42%). This is no fluke: Doximity’s subscription model leverages a 92.1% gross margin (due to low incremental costs for adding users), while its focus on operational discipline—evident in 50%+ free cash flow growth—ensures scalability.

Critics argue that Q3’s 61% margin spike was unsustainable. But management has consistently guided toward a 54% annual EBITDA target, achievable through seasonality smoothing and January launch efficiencies. With $845 million in cash and a $451M share repurchase program, Doximity is primed to capitalize on its financial fortitude without dilution.

Why the Market Is Missing the Opportunity

Despite these strengths, Doximity trades at a P/E of 54.65, below peers like Veeva (60.7) and Cerner (72.1). This undervaluation persists because investors underestimate two catalysts:
1. AI’s Tipping Point: Doximity’s AI tools—used by 1.8 million physicians—will soon generate $1M+ in annual revenue per module, per management. This mirrors the trajectory of its news feed, which now dominates physician digital engagement.
2. Regulatory Tailwinds: The Inflation Reduction Act’s push for telehealth adoption and pharma’s shift away from costly direct-to-consumer ads favor Doximity’s cost-effective, data-driven solutions.

Risks, but Not Dealbreakers

Competitors like Epic and Cerner are muscling into digital collaboration, and macroeconomic pressures could slow health system spending. Yet Doximity’s 250+ health system clients and 60% penetration of nurse practitioners suggest a durable moat. Meanwhile, its AI-first strategy keeps it ahead of rivals stuck in legacy infrastructure.

Conclusion: A Buy at These Levels

Doximity’s Q4 results confirm it’s not just surviving but thriving in a consolidating healthcare tech landscape. With enterprise adoption accelerating, margins expanding, and AI unlocking new revenue streams, this is a stock primed for a re-rating.

Investors should act now: The company’s FY2026 revenue guidance of $619–631 million assumes only modest growth, leaving room for upside. With cash flow metrics hitting record highs and a market cap still below peers, Doximity is the rare stock where fundamentals outpace valuation. This is a “buy the dip” opportunity that won’t last long.