Shares of Doximity (DOCS -1.86%) leaped 24% on Wednesday after the networking platform for medical professionals announced strong third-quarter growth metrics.
Doximity's revenue surged 67% year over year to $97.9 million in its fiscal 2022 third quarter, which ended on Dec. 31.
Pharmaceutical companies and other healthcare providers are ramping up their advertising spend on Doximity's network. "We had a strong Q3 led by our existing clients as our net revenue retention rate hit 171%," CEO Jeff Tangney said in a press release. Essentially, that means Doximity's customers spent 71% more than they did in the prior-year period.
Doximity is benefiting from the advertising-industry's migration from TV and other traditional formats to easier-to-track -- and often more effective -- online channels. Doximity's profits, in turn, are soaring.
Its net income rocketed 223% to $55.6 million, or $0.26 per share. On an adjusted basis, its earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 119%, to $47 million.
These results prompted Doximity to boost its full-year sales and earnings forecast. Management now expects revenue and adjusted EBITDA of $338.9 million to $339.9 million and $144.9 million to $145.9 million, respectively, in fiscal 2022. It also sees revenue growing an additional 33%, to $450 million, in fiscal 2023.
Additionally, Doximity said it struck a deal to acquire Amion, a leading on-call physician-scheduling site. Nearly 200,000 doctors use Amion's tools to manage their day-to-day schedules.
The deal values Amion at $82.5 million, including $53.5 million in cash and up to $29 million in earn-out payments. The transaction is expected to close in April.