By Daniel Shvartsman

Investing.com – Doximity Inc shares rose 25% Wednesday after the company announced an acquisition and posted strong after-hours earnings.

Doximity posted a net income of $97.88M. This is a 67% increase over a previous year and more than 10M above guidance. GAAP income was $.26/share while non-GAAP income was $.29/share. This is in excess of the $.12/share estimates.

Full-year guidance was also increased to $338.9-$339.9M by the company, an increase of more than $10M. Analyst expectations were met by the company’s Q1 guidance (2022 fiscal quarter).

The company further announced acquisitionAmion is a scheduling platform and messaging tool that nearly 200K physicians use. It was purchased by Doximity for $53.5M, plus $29M in earned-outs. Doximity projected that Amion would have $5M in annual revenue by 2021.

“We had a strong Q3 led by our existing clients as our net revenue retention rate hit 171%,” said Jeff Tangney, co-founder & CEO at Doximity. “Our telehealth platform grew to 350,000 active providers and we agreed to acquire Amion which powers nearly 200,000 physician schedule. It’s our life’s work to build the physician cloud – a digital platform to help physicians save time, so they can provide better care for patients.”

In addition, the company provided FY 2023 guidance for the year beginning in April. This included 33% revenue growth and a 40% adjusted EBITDA margin before taking into account any Amion effects.

Analysts viewed the beat positive, even though Raymond James and Needham and Company, two bullish analysts, lowered their price targets. Perhaps this was due to the weakening economic climate. StreetInsider’s Scott Berg, Needham analyst, wrote that Doximity had reported the biggest revenue increase to date. He also noted positive sales metrics, such as NRR of 171%, $100k plus customers increasing 50% year-over-year, and spend at top five customers rising 90% year over year. We like Amion’s acquisition strategy because it continues to emphasize expanding functionality and driving higher physician engagement. This will ultimately lead to higher revenue from marketing solutions.

DOCS IPO was last year for $26/share. It saw shares double in just a few months. Although trading at above the initial price, it is still over 40% below its 52-week peak.