What happened
Shares of Doximity (DOCS -1.88%) climbed more than 32% on Friday after the digital platform for medical professionals reported impressive revenue growth and announced a new stock buyback program.
So what
Doximity is enjoying rising demand for its professional networking, medical news, and productivity services. Revenue jumped 29% year over year to $102.2 million in its fiscal 2023 second quarter, which ended on Sept. 30.
Doximity's telehealth and marketing solutions were notable sources of growth. Over 370,000 clinicians now use its video conferencing platform. Pharmaceutical companies and other healthcare providers, meanwhile, are seeing strong returns on their advertising investments.
All told, Doximity's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) surged 40% to $46 million.
The company's cash flow growth was even more impressive. Doximity's operating cash flow soared 106% to $39.5 million, while its free cash flow increased 109% to $37.7 million.
Now what
Doximity said it was on track to achieve its full-year financial targets, including revenue of $424 million to $432 million and adjusted EBITDA of $178 million to $186 million. That was a relief to investors, many of whom were concerned that inflation-related challenges and recession fears would drive advertisers to pull back on their spending.
Management's confidence in Doximity's ability to hit its sales and adjusted earnings goals likely spurred its plans to return more capital to its shareowners. The company's board of directors authorized the repurchase of an additional $70 million worth of its stock. Doximity expects to complete these share buybacks over the next year.
