Glenn Santangelo

Glenn Santangelo sought clarification on Doximity's fiscal 2027 growth expectations, specifically the projection to end calendar year 2026 with significantly better growth than the 4% Q4 forecast. He also asked for Jeff Tangney's perspective on the public market's perceived AI disruption, Doximity's valuation, and whether the company needs to remain public given its strong balance sheet.

Answer

Perry Gold, VP of Investor Relations, affirmed expectations for Doximity to exit calendar year 2026 as a double-digit grower, citing the anticipated release of client funds, Doximity's high ROI, and the upcoming commercial AI product. Jeff Tangney, CEO and Co-Founder, viewed AI as a significant tailwind for healthcare, emphasizing Doximity's unique Peer Check program as a solution to the critical trust issue in medical AI. He stated he tries not to focus on public market trading but acknowledged investor questions, expressing pride in Doximity's mission and attractive cash flows.

Glenn Santangelo asked Jeff Tangney for his perspective on the public markets punishing companies with perceived AI disruption, Doximity's valuation, and whether Doximity needs to remain a public company given its strong balance sheet.

Answer

Jeff Tangney, Co-founder and CEO, viewed AI as a tailwind and a significant opportunity to transform healthcare. He emphasized that the core problem with AI for doctors is trust, and Doximity's Peer Check program, with 10,000 noted authors, addresses this by providing expert-reviewed answers. Regarding public market trading, he stated he tries not to focus on it, acknowledging investor questions but reiterating pride in serving doctors and generating attractive cash flows.

Glenn Santangelo followed up on North American pharmaceutical segment operating profit, noting the implied full-year growth range is wider than normal, and asked if there are any positive or negative trends heading into fiscal Q4 and FY27 that should be closely monitored.

Answer

Britt Vitalone, CFO, clarified that the full-year adjusted operating profit growth guidance for North American Pharma was raised from 5%-9% to 8%-12%, maintaining the same width but increasing the range due to strong Q3 performance and confidence in the business trajectory. He reiterated strong specialty distribution growth, continued focus on operational excellence, and stable utilization trends as key drivers, noting positive trends across retail pharmacy and health systems.

Glenn Santangelo inquired about the expected operating income growth for the remainder of the fiscal year, specifically addressing the deceleration observed in the U.S. segment's performance from the September to December quarter and any anticipated headwinds or tailwinds.

Answer

Jim Cleary, Executive VP and CFO, Cencora, explained that the U.S. segment's adjusted operating income grew 21% in the December quarter. He clarified that even excluding the strong performance from RCA, the U.S. segment's growth was at the higher end of their 7%-10% long-term guidance, despite headwinds from a lost oncology customer. Cleary attributed this to strong utilization trends, specialty performance, and broad-based U.S. segment strength, leading to an increased full-year U.S. guidance of 14%-16%.