Why Doximity Stock Skyrocketed on Friday

Why Doximity Stock Skyrocketed on Friday

Joe Tenebruso, The Motley Fool

Sat, August 8, 2026 at 8:26 PM GMT+3 3 min read

• DOCS +32.62%
• NVDA +2.27%

Shares of Doximity (NYSE: DOCS) surged on Friday after management highlighted the remarkable returns it was beginning to realize on its artificial intelligence (AI) investments.

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Q1 results were just part of the story

Doximity's revenue rose 7% year over year to $156.6 million in its fiscal 2027 first quarter, which ended on June 30.

Yet its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) fell 6% to $74.8 million. The digital networking, news, and telehealth platform for healthcare professionals is spending aggressively to develop its AI tools.

Those investments are beginning to pay off in a big way, according to CEO Jeff Tangney.

Leaning into AI

In an independent study of 24 clinical AI models, the company's AI assistant, Doximity Ask, was the top-performing U.S.-based model with the lowest clinical error rates and the highest safety ratings. Notably, Doximity Ask had significantly lower error rates than Anthropic's best model, Fable 5.

This superior performance is leading to sharply higher usage of Doximity's AI offerings.

"AI prompt volume was up more than 25% quarter-on-quarter, while our AI Scribe note-taking users grew a whopping 10x this July over prior," Tangney said during a conference call with analysts.

But what really caught investors' attention were Tangney's comments regarding the profit potential of Doximity's AI tools.

In terms of the economics of the usage, it's early days on our AI Search product, but I can tell you we're earning more than 10 times per search in revenue than it costs us to run that today.

10x certainly has a nice ring to it. And Tangney indicated that the returns would likely get even better from there.

Over time, we probably expect the overall AI cost, if anything, go down as models get more efficient.

Tangney's comments painted a picture of a lucrative, AI-driven future for Doximity, and investors bid up its shares as they rushed to grab a piece of it.

"We are leaning in as we see a once-in-a-generation opportunity to build the new AI age of medicine," Tangney said.

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Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Doximity. The Motley Fool has a disclosure policy.

Why Doximity Stock Skyrocketed on Friday was originally published by The Motley Fool