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Doximity, Inc. Investors Notice: Class action lawsuit filed on behalf of investors; the Portnoy Law Firm

Globe Newswire 11-Jun-2024 11:35 AM

Investors can contact the law firm at no cost to learn more about recovering their losses

LOS ANGELES, June 11, 2024 (GLOBE NEWSWIRE) -- The Portnoy Law Firm advises Doximity, Inc. (NYSE:DOCS) ("Doximity" or the "Company") investors who purchased or acquired Doximity common stock between February 9, 2022, and April 1, 2024, inclusive (the "Class Period") to visit our website.

Doximity operates a digital platform that connects medical professionals, provides medical information, and offers patient scheduling tools. The Class Period begins on February 9, 2022, after the release of Doximity's third-quarter financial results for fiscal year 2022, which ended December 31, 2021. During the February 8, 2022, investor earnings call, Chief Financial Officer Anna Bryson highlighted that "marketers have been able to witness the value of running these digital programs" and that this "value" was the primary driver of sustained demand from customers, rather than new COVID variants. Bryson assured investors that the Company was focused on building a business capable of providing years of sustainable growth with high margins.

Throughout the Class Period, Defendants continued to promote the sustainability of Doximity's business prospects while downplaying the significance of customer upsell rates on the Company's financial performance. Despite their claims about Doximity's growth and profitability, investors began to uncover the truth on August 8, 2023, when Doximity reported its financial results for the first quarter of fiscal year 2024, which ended June 30, 2023. Although the Company exceeded its revenue and adjusted EBITDA guidance for the first quarter, it provided disappointing guidance for the second quarter of fiscal year 2024 and reduced its guidance for the full fiscal year 2024. Additionally, Doximity announced a workforce reduction of approximately 10%, expected to cost between $8 million and $10 million.
Explaining this reversal, Bryson admitted that the Company's "major upsells have materially underperformed, and we expect this to continue in the near term." CEO Jeff Tangney further explained that Doximity failed to close sales partly due to "fewer face-to-face meetings with our clients." Following this news, Doximity's stock price fell $7.49 per share, or nearly 23%, from $32.79 per share on August 8, 2023, to $25.30 per share on August 9, 2023.

Investors learned more about the unsustainability of the Company's revenue growth on April 1, 2024, when Jehoshaphat Research published a report alleging that "Doximity's underlying sales are declining at a negative 3-6% rate, but this decline has been masked through accelerated revenue recognition." Following this news, Doximity's stock price declined $1.11 per share, or more than 4%, over two trading days, from $26.91 per share on March 28, 2024, to $25.80 per share on April 2, 2024.

Please visit our website to review more information and submit your transaction information.

The Portnoy Law Firm represents investors in pursuing claims against caused by corporate wrongdoing. The Firm's founding partner has recovered over $5.5 billion for aggrieved investors. Attorney advertising. Prior results do not guarantee similar outcomes.

Lesley F. Portnoy, Esq.
Admitted CA and NY Bar
Attorney Advertising

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