Doximity Inc

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and accompanying notes that are included elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K, filed with the SEC on May 26, 2023. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, as described under the heading “Special Note Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under the section titled “Risk Factors” in Part 1, Item 1 A of our Annual Report on Form 10-K or in other parts of this Quarterly Report on Form 10-Q. Our historical results are not necessarily indicative of the results that may be expected for any period in the future, and our interim results are not necessarily indicative of the results that may be expected for the full fiscal year or any other period. The last day of our fiscal year is March 31 st. Our fiscal quarters end on June 30 th, September 30 th, December 31 st, and March 31 st. Fiscal 2024, our current fiscal year, will end on March 31, 2024.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and accompanying notes that are included elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K, filed with the SEC on May 23, 2024. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, as described under the heading “Special Note Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under the section titled “Risk Factors” in Part 1, Item 1A of our Annual Report on Form 10-K or in other parts of this Quarterly Report on Form 10-Q. Our historical results are not necessarily indicative of the results that may be expected for any period in the future, and our interim results are not necessarily indicative of the results that may be expected for the full fiscal year or any other period. The last day of our fiscal year is March 31 st. Our fiscal quarters end on June 30 th, September 30 th, December 31 st, and March 31 st. Fiscal 2025, our current fiscal year, will end on March 31, 2025.

Previous wording

We are the leading digital platform for U.S. medical professionals, as measured by the number of U.S. physician members. Our members include more than 80% of physicians across all 50 states and every medical specialty.

Current wording

We are the leading digital platform for U.S. medical professionals, as measured by the number of members. Our members include more than 80% of U.S. physicians, spanning all 50 states and every medical specialty.

Previous wording

Our mission is to help every physician be more productive and provide better care for their patients. We are physicians-first, putting technology to work for doctors instead of the other way around. That guiding principle has enabled Doximity to become an essential and trusted professional platform for physicians. Our cloud-based platform provides our members with tools specifically built for medical professionals, enabling them to collaborate with their colleagues, securely coordinate patient care, conduct virtual patient visits, stay up-to-date with the latest medical news and research, monitor their work schedules, and manage their careers. Doximity membership is free for physicians. Our revenue-generating customers, primarily pharmaceutical manufacturers and healthcare systems, have access to a suite of commercial solutions that benefit from broad physician usage.

Current wording

Our mission is to help every physician be more productive and provide better care for their patients. We are physicians-first, putting technology to work for doctors instead of the other way around. That guiding principle has enabled Doximity to become an essential and trusted professional platform for physicians. Our physician cloud puts modern software in the hands of physicians and other medical professionals, enabling our members to collaborate with colleagues, stay up to date with the latest medical news and research, manage their careers and on-call schedules, streamline documentation and administrative paperwork, and conduct virtual patient visits. Our revenue-generating customers, primarily pharmaceutical manufacturers and healthcare systems, have access to a suite of commercial solutions that benefit from broad physician usage.

Previous wording

At the core of our platform is the largest medical professional network in the nation, which creates proximity within our community of doctors and hundreds of thousands of other medical professionals. Verified members can search and connect with colleagues and specialists, which allows them to better coordinate patient care and streamline referrals. Our newsfeed addresses the ever increasing sub-specialization of medical expertise and volume of medical research by delivering news and information that is relevant to each physician's clinical practice. We also support physicians in their day-to-day practice of medicine with mobile-friendly and easy-to-use clinical workflow tools such as voice and video dialer, secure messaging, and digital faxing.

Current wording

At the core of our platform is the largest medical professional network in the nation, which creates proximity within our community of doctors and hundreds of thousands of other medical professionals. Verified members can search and connect with colleagues and specialists, which allows them to better coordinate patient care and streamline referrals. Our newsfeed addresses the ever increasing sub-specialization of medical expertise and volume of medical research by delivering news and information that is relevant to each physician's clinical practice. We also support physicians in their day-to-day practice of medicine with mobile-friendly and easy-to-use productivity tools such as voice and video dialer, secure messaging, digital faxing, and Doximity GPT. Our business model is designed to both respect and support physicians while driving value for our customers through our Marketing, Hiring, and Productivity Solutions. Our revenue-generating customers, primarily pharmaceutical manufacturers and health systems, have access to a suite of commercial solutions that benefit from broad physician usage.

Previous wording

Our business model has delivered high revenue growth at scale with profitability. For the three months ended December 31, 2023 and 2022, we recognized revenue of $135.3 million and $115.3 million, respectively, representing a year-over-year growth rate of 17%. For the nine months ended December 31, 2023 and 2022, we recognized revenue of $357.4 million and $308.1 million, respectively, representing a year-over-year growth rate of 16%. For the three months ended December 31, 2023 and 2022, our net income was $48.0 million and $33.5 million and our adjusted EBITDA was $73.3 million and $55.5 million, respectively. For the nine months ended December 31, 2023 and 2022, our net income was $107.0 million and $82.2 million and our adjusted EBITDA was $174.0 million and $135.0 million, respectively. We have accomplished this while focusing on our core mission to help every physician be more productive and provide better care for their patients.

Current wording

Our business model has delivered high revenue growth at scale with profitability. For the three months ended June 30, 2024 and 2023, we recognized revenue of $126.7 million and $108.5 million, respectively, representing a year-over-year growth rate of 17%. For the three months ended June 30, 2024 and 2023, our net income was $41.4 million and $28.4 million and our adjusted EBITDA was $65.9 million and $46.6 million, respectively. We have accomplished this while focusing on our core mission to help every physician be more productive and provide better care for their patients.

Previous wording

Customers with Trailing 12-Month Subscription Revenue Greater than $100,000. The number of customers with trailing 12-month (“TTM”) subscription revenue greater than $100,000 is a key indicator of the scale of our business, and is calculated by counting the number of customers that contributed more than $100,000 in subscription revenue in the TTM period. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our total customer count for historical periods reflecting these adjustments.

Current wording

Customers with Trailing 12-Month Subscription Revenue Greater than $500,000. The number of customers with trailing 12-month (“TTM”) subscription revenue greater than $500,000 is a key indicator of the scale of our business, and is calculated by counting the number of customers that contributed more than $500,000 in subscription revenue in the TTM period. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our total customer count for historical periods reflecting these adjustments.

Previous wording

The number of customers with at least $100,000 of revenue has grown steadily in recent years as we have engaged new customers and expanded within existing ones. This cohort of customers accounted for approximately 89% of our revenue for the TTM ended December 31, 2023.

Current wording

The number of customers with at least $500,000 of revenue has grown steadily in recent years as we have engaged new customers and expanded within existing ones. This cohort of customers accounted for approximately 82% of our revenue for the TTM ended June 30, 2024.

Previous wording

We define adjusted EBITDA as net income before interest, income taxes, depreciation, and amortization, and as further adjusted for acquisition and other related expenses, stock-based compensation expense, restructuring expense, change in fair value of contingent earn-out consideration liability, and other income, net. Net income margin represents net income as a percentage of revenue and adjusted EBITDA margin represents adjusted EBITDA as a percentage of revenue.

Current wording

We define adjusted EBITDA as net income before interest, income taxes, depreciation, and amortization, and as further adjusted for stock-based compensation expense, change in fair value of contingent earn-out consideration liability, and other income, net. Net income margin represents net income as a percentage of revenue and adjusted EBITDA margin represents adjusted EBITDA as a percentage of revenue.

Previous wording

Hiring Solutions. We provide customers access to our platform which enables them to post job openings or deliver a fixed number of monthly messages to our network of medical professionals. Hiring Solutions contracts are noncancellable and customers are billed in annual, quarterly, or monthly installments in advance of the service period, and revenue is recognized ratably over the contractual term.

Current wording

Hiring Solutions. We provide customers access to our platform which enables them to post job openings or deliver a fixed number of monthly messages to our network of medical professionals. Hiring Solutions contracts are noncancelable and customers are billed in annual, quarterly, or monthly installments in advance of the service period, and revenue is recognized ratably over the contractual term.

Previous wording

We also generate revenue from temporary and permanent medical recruiting services which we charge on an hourly-fee, and retainer and placement-fee basis, respectively. Revenue for temporary placement services is recognized net of third-party contractor fees. For the three and nine months ended December 31, 2023 and 2022, the revenue from temporary and permanent medical recruiting services was not significant to our total revenue.

Current wording

We also generate revenue from temporary and permanent medical recruiting services which we charge on an hourly-fee, and retainer and placement-fee basis, respectively. For the three months ended June 30, 2024 and 2023, the revenue from temporary and permanent medical recruiting services was not significant to our total revenue.

Previous wording

Cost of revenue is primarily comprised of expenses related to cloud hosting, personnel-related expenses for our customer success team, costs for third-party platform access, information technology and software-related services and contractors, and other services used in connection with thedelivery and support of our platform. Our cost of revenue also includes the amortization of internal-use software development costs, editorial and other content-related expenses, and allocated overhead. Cost of revenue is driven by the growth of our member network and utilization of our telehealth tools. We intend to continue to invest additional resources in our cloud infrastructure and our customer support organizations to support the growth of our business and expect these expenses to increase on an absolute dollar basis.

Current wording

Cost of revenue is primarily comprised of expenses related to cloud hosting, personnel-related expenses for our customer success team, costs for third-party platform access, information technology and software-related services and contractors, and other services used in connection with thedelivery and support of our platform. Our cost of revenue also includes the amortization of internal-use software development costs, editorial and other content-related expenses, and allocated overhead. Cost of revenue is driven by the growth of our member network and utilization of our productivity tools. We intend to continue to invest additional resources in our cloud infrastructure and our customer support organizations to support the growth of our business.

Previous wording

Our operating expenses consist of research and development, sales and marketing, general and administrative, and restructuring expenses.

Current wording

Our operating expenses consist of research and development, sales and marketing, and general and administrative expenses.

Previous wording

Sales and marketing expense is primarily comprised ofpersonnel-related expenses, sales incentive compensation, travel, and other event expenses. Sales and marketing expense also includes costs for third-party services and contractors, information technology and software-related costs, allocated overhead, amortization of intangible assets, and change in fair value of contingent earn-out consideration liability. We capitalize sales incentive compensation that is considered to be an incremental and recoverable cost of obtaining a contract with a customer. These sales incentive compensation costs are amortized over the period of benefit. We expect sales and marketing expense to increase and to be our largest expense on an absolute basis.

Current wording

Sales and marketing expense is primarily comprised ofpersonnel-related expenses, sales incentive compensation, advertising costs, travel, and other event expenses. Sales and marketing expense also includes costs for third-party services and contractors, information technology and software-related costs, allocated overhead, amortization of intangible assets, and change in fair value of contingent earn-out consideration liability. We capitalize sales incentive compensation that is considered to be an incremental and recoverable cost of obtaining a contract with a customer. These sales incentive compensation costs are amortized over the period of benefit. We expect sales and marketing expense to increase and to be our largest expense on an absolute basis.

Previous wording

Provision for income taxes consists primarily of income taxes in U.S. federal, state, and local jurisdictions in which we conduct business. We calculate income taxes in interim periods by applying an estimated annual effective tax rate to income before income taxes and by calculating the tax effect of discrete items recognized during the period. Our effective income tax rate generally differs from the U.S. statutory tax rate of 21.0% primarily due to U.S. federal and state research and development tax credits, stock-based compensation related tax benefits, and state income taxes.

Current wording

Provision for income taxes consists primarily of income taxes in U.S. federal, state, and local jurisdictions in which we conduct business. We calculate income taxes in interim periods by applying an estimated annual effective tax rate to income before income taxes and by calculating the tax effect of discrete items recognized during the period. Our effective income tax rate generally differs from the U.S. statutory tax rate of 21.0% primarily due to U.S. federal and state research and development tax credits and stock-based compensation related tax benefits, and state income taxes.

Previous wording

Comparison of the three and nine months ended December 31, 2023 and 2022.

Current wording

Comparison of the three months ended June 30, 2024 and 2023.

Previous wording

Revenue for the three months ended December 31, 2023 increased $20.0 million as compared to the same period in 2022. The increase was primarily driven by a $22.0 million increase in subscription revenue. Of the increase in subscription revenue, $6.0 million was driven by the addition of new subscription customers 1 and $16.0 million was due to the expansion of existing customers. The expansion of existing customers was primarily driven by average revenue per existing Marketing Solutions customers increasing by 26% as a result of adding new and growing existing brands and service lines. Approximately 96% of our revenue for the three months ended December 31, 2023 was derived from subscription customers. The remaining change in revenue was driven by medical recruiting services.

Current wording

Revenue for the three months ended June 30, 2024 increased $18.2 million as compared to the same period in 2023. The increase was primarily driven by a $18.7 million increase in subscription revenue. Of the increase in subscription revenue, $5.5 million was driven by the addition of new subscription customers 1 and $13.2 million was due to the expansion of existing customers. The expansion of existing customers was primarily driven by average revenue per existing Marketing Solutions customers increasing by approximately 19% as a result of adding new and growing existing brands and service lines. Approximately 95% of our revenue for the three months ended June 30, 2024 was derived from subscription customers. The remaining change in revenue was primarily due to a reduction in permanent placement recruiting services.

Previous wording

The gross margin for the three and nine months ended December 31, 2023 increased due to the growth in our revenue as well as lower costs of revenue as a result of the Company’s restructuring plan executed in August 2023.

Current wording

The gross margin for the three months ended June 30, 2024 increased due to the growth in our revenue.

Previous wording

Research and development expense for the three months ended December 31, 2023 was materially consistent with 2022 due to personnel costs remaining relatively flat as a result of the Company’s restructuring plan executed in August 2023.

Current wording

Research and development expense for the three months ended June 30, 2024 remained materially consistent as compared to the same period in 2023.

Previous wording

Sales and marketing expense for the three months ended December 31, 2023 increased $1.7 million as compared to the same period in 2022. The increase was primarily driven by a $1.1 million increase in marketing expense, offset by a $0.6 million decrease in employee compensation costs as a result of a reduction in average headcount due to the Company’s restructuring plan executed in August 2023, offset by merit increases.

Current wording

Sales and marketing expense for the three months ended June 30, 2024 increased $0.8 million as compared to the same period in 2023. The increase was primarily driven by a $0.9 million increase in sales incentive compensation and a $0.6 million increase in stock-based compensation expense as a result of new awards granted to existing employees and a $0.5 million increase in marketing activities. These increases were partially offset by a $1.5 million decrease in personnel costs as a result of a reduction in average headcount due to the Company’s restructuring plan executed in August 2023.

Previous wording

General and administrative expense for the three and nine months ended December 31, 2023 remained materially consistent as compared to the same period in 2022.

Current wording

General and administrative expense for the three months ended June 30, 2024 remained materially consistent as compared to the same period in 2023.

Previous wording

Other income, net for the three and nine months ended December 31, 2023 increased $2.0 million and $11.1 million, respectively, as compared to the same period in 2022, primarily driven by increases in interest income due to higher yields earned on our cash equivalents and marketable securities portfolio and a higher average portfolio balance.

Current wording

Other income, net for the three months ended June 30, 2024 increased $2.3 million as compared to the same period in 2023, primarily driven by increases in interest income due to higher yields earned on our cash equivalents and marketable securities portfolio.

Previous wording

Income tax expense increased for the three and nine months ended December 31, 2023 by $7.6 million and $16.0 million, respectively, as compared to the same period in 2022, primarily driven by higher income before taxes and decreased tax deductions from stock award activities.

Current wording

Income tax expense for the three months ended June 30, 2024 increased $5.7 million as compared to the same period in 2023, primarily driven by higher income before taxes and decreased tax deductions from stock award activities.

Previous wording

Since inception, we have financed operations primarily through proceeds received from sales of equity securities and payments received from our customers. As of December 31, 2023, our principal sources of liquidity were cash and cash equivalents and marketable securities of $710.2 million. Our marketable securities consist of U.S. government and agency securities, corporate notes and bonds, commercial paper, certificates of deposit, asset-backed securities, and sovereign bonds.

Current wording

Since inception, we have financed operations primarily through proceeds received from sales of equity securities and payments received from our customers. As of June 30, 2024, our principal sources of liquidity were cash and cash equivalents and marketable securities of $750.5 million. Our marketable securities consist of U.S. government and agency securities, corporate notes and bonds, and commercial paper.

Previous wording

On October 26, 2023, the Company’s board of directors authorized a program to repurchase up to $70 million of the Company’s Class A common stock over a period of 12 months. The repurchases are subject to general business and market conditions and other investment opportunities and may be executed through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans. Immediately upon the repurchase of any shares of Class A common stock, such shares shall be retired by the Company and shall automatically return to the status of authorized but unissued shares of Class A common stock. As of December 31, 2023, the Company repurchased and retired 331,960 shares of Class A common stock for an aggregate purchase price of $8.0 million. As of December 31, 2023, $62.0 million remained available and authorized for repurchase.

Current wording

All repurchases are subject to general business and market conditions and other investment opportunities and may be executed through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans. Immediately upon the repurchase of any shares of Class A common stock, such shares shall be retired by the Company and shall automatically return to the status of authorized but unissued shares of Class A common stock.

Previous wording

Effective January 1, 2023, the Company’s share repurchases in excess of allowable share issuances are subject to a 1% excise tax as a result of the Inflation Reduction Act of 2022. During the nine months ended December 31, 2023, the Company incurred excise taxes of $1.6 million, all of which remained unpaid as of December 31, 2023.

Current wording

Effective January 1, 2023, the Company’s share repurchases in excess of allowable share issuances are subject to a 1% excise tax as a result of the Inflation Reduction Act of 2022. To date, the Company has incurred excise taxes of $1.7 million, all of which remained unpaid as of June 30, 2024.

Previous wording

Cash provided by operating activities was $120.2 million for the nine months ended December 31, 2023. This consisted of net income of $107.0 million, adjusted for non-cash items of $53.0 million and a net outflow from operating assets and liabilities of $39.8 million. Non-cash items primarily consisted of stock-based compensation expense of $39.2 million, depreciation and amortization expense of $7.7 million, amortization of deferred contract costs of $6.3 million, non-cash lease expense of $1.6 million, partially offset by the accretion of discount on marketable securities of $3.5 million. The net outflow from operating assets and liabilities was driven by a $38.6 million decrease in deferred revenue due to the timing of customer billings and program launches, a $6.9 million increase in deferred contract costs, a $4.0 million increase in prepaid expenses and other assets primarily due to prepayment of income taxes, a $1.2 million decrease in operating lease liabilities. These outflows were partially offset by a $8.5 million decrease in accounts receivable due to the timing of billings and collections and a $2.4 million increase in accounts payable, accrued expenses, and other liabilities which was primarily due to the timing of commission payments. During the nine months ended December 31, 2023 and 2022, the Company made $38.4 million and $2.5 million, respectively, in payments for taxes. The increase in cash paid for income taxes was partially related to the Tax Cuts and Jobs Act of 2017, which eliminated the option to deduct research and development expenditures and required taxpayers to capitalize and amortize them over five or fifteen years. Although Congress is considering legislation that would defer the amortization requirement to later years, we have no assurance that the provision will be so deferred, repealed or otherwise modified. If the requirement is not modified, our cash flows from operating activities are expected to be reduced by approximately $12.2 million in the fiscal year ended March 31, 2024. The requirement may also reduce our cash flows from operating activities in future periods, the amounts and specific periods of which we are unable to estimate at this time.

Current wording

Cash provided by operating activities was $41.2 million for the three months ended June 30, 2024. This consisted of net income of $41.4 million, adjusted for non-cash items of $20.0 million and a net outflow from operating assets and liabilities of $20.1 million. Non-cash items primarily consisted of stock-based compensation expense of $17.1 million, depreciation and amortization expense of $2.6 million, amortization of deferred contract costs of $2.7 million, non-cash lease expense of $0.5 million, partially offset by the accretion of discount on marketable securities of $2.4 million. The net outflow from operating assets and liabilities was driven by a $19.4 million increase in accounts receivable due to the timing of billings and collections, a $12.9 million decrease in accounts payable, accrued expenses, and other liabilities which was primarily due to the timing of transferable tax credit payments, and a $1.4 million increase in deferred contract costs. The outflows were partially offset by a $10.5 million decrease in prepaid expenses and other assets primarily due to prepaid taxes, and a $3.7 million increase in deferred revenue due to the timing of customer billings and program launches. During the three months ended June 30, 2024, the Company made $12.9 million in payments for taxes, whereas during the three months ended June 30, 2023, the Company did not make significant tax payments. The increase in cash paid for income taxes was partially related to the Tax Cuts and Jobs Act of 2017, which eliminated the option to deduct research and development expenditures and required taxpayers to capitalize and amortize them over five or fifteen years. Although Congress is considering legislation that would defer the amortization requirement to later years, we have no assurance that the provision will be so deferred, repealed or otherwise modified. The requirement may also reduce our cash flows from operating activities in future periods, the amounts and specific periods of which we are unable to estimate at this time.

Previous wording

Cash provided by operating activities was $133.0 million for the nine months ended December 31, 2022. This consisted of net income of $82.2 million, adjusted for non-cash items of $64.7 million and a net outflow from operating assets and liabilities of $13.9 million. Non-cash items primarily consisted of stock-based compensation expense of $34.8 million, deferred income taxes of $9.4 million, depreciation and amortization expense of $7.6 million, amortization of deferred contract costs of $6.4 million, and amortization of the premium on marketable securities of $3.1 million. The net outflow from operating assets and liabilities was driven by an $18.1 million decrease in deferred revenue due to the timing of customer billings and program launches, and a $6.4 million increase in deferred contract costs. These outflows were partially offset by a $6.2 million decrease in accounts receivable due to the timing of billings and collections, a $2.7 million increase in accounts payable, accrued expenses, and other liabilities, which was primarily a result of the timing of the ESPP and commission payments, and a $1.9 million decrease in prepaid expenses and other assets due to a decrease in prepaid taxes.

Current wording

Cash provided by operating activities was $57.2 million for the three months ended June 30, 2023. This consisted of net income of $28.4 million, adjusted for non-cash items of $19.6 million and a net inflow from operating assets and liabilities of $9.2 million. Non-cash items primarily consisted of stock-based compensation expense of $14.0 million, depreciation and amortization expense of $2.6 million, and amortization of deferred contract costs of $2.7 million. The net inflow from operating assets and liabilities was driven by a $14.0 million decrease in accounts receivable due to the timing of billings and collections, a $0.7 million increase in accounts payable, accrued expenses, and other liabilities due to the increase in employee contributions under the ESPP, and a $2.6 million decrease in prepaid expenses and other assets. These inflows were partially offset by a $6.9 million decrease in deferred revenue due to the timing of customer billings and program launches, and a $1.2 million increase in deferred contract costs.

Previous wording

Cash used in investing activities was $46.7 million for the nine months ended December 31, 2022, which primarily consisted of $130.3 million of marketable securities purchases, $53.5 million paid for the acquisition of AMiON, $3.5 million for internal-use software development costs, and $1.7 million for purchases of property and equipment. These payments were partially offset by proceeds from the sale of marketable securities of $107.2 million and proceeds from the maturities of marketable securities of $35.0 million.

Current wording

Cash provided by investing activities was $29.9 million for the three months ended June 30, 2024, which primarily consisted of proceeds from the maturities of marketable securities of $202.1 million, partially offset by $170.4 million of marketable securities purchases and $1.7 million for internal-use software development costs.

Previous wording

Cash provided by investing activities was $107.4 million for the nine months ended December 31, 2023, which primarily consisted of proceeds from the maturities of marketable securities of $318.2 million and proceeds from the sale of marketable securities of $74.7 million. These inflows were partially offset by $281.3 million of marketable securities purchases and $4.0 million for internal-use software development costs.

Current wording

Cash provided by investing activities was $117.3 million for the three months ended June 30, 2023, which primarily consisted of proceeds from the maturities of marketable securities of $116.6 million and proceeds from the sale of marketable securities of $37.5 million. These inflows were partially offset by $35.3 million of marketable securities purchases and $1.5 million for internal-use software development costs.

Previous wording

Cash used in financing activities was $62.6 million for the nine months ended December 31, 2022, which primarily consisted of common stock repurchases of $70.0 million and $2.4 million of taxes paid related to the net share settlement of equity awards. These payments were partially offset by $7.5 million of proceeds from the exercise of stock options and common stock warrants and $2.3 million of proceeds from the issuance of common stock related to the employee stock purchase plan.

Current wording

Cash used in financing activities was $56.5 million for the three months ended June 30, 2024, which primarily consisted of common stock repurchases of $51.2 million, $5.5 million of payments for contingent consideration related to the AMiON acquisition, and $2.4 million of taxes paid related to the net share settlement of equity awards. These payments were partially offset by $2.6 million of proceeds from the exercise of stock options.

Previous wording

Cash used in financing activities was $262.4 million for the nine months ended December 31, 2023, which primarily consisted of common stock repurchases of $263.0 million, $5.4 million of payments for contingent consideration related to the AMiON acquisition, and $5.3 million of taxes paid related to the net share settlement of equity awards. These payments were partially offset by $9.8 million of proceeds from the exercise of stock options and warrants and $1.5 million of proceeds from the issuance of common stock related to the employee stock purchase plan.

Current wording

Cash used in financing activities was $25.8 million for the three months ended June 30, 2023, which primarily consisted of common stock repurchases of $21.8 million, $5.4 million of payments for contingent consideration related to the AMiON acquisition, and $2.0 million of taxes paid related to the net share settlement of equity awards. These payments were partially offset by $3.3 million of proceeds from the exercise of stock options.

Previous wording

There have been no material changes to our critical accounting policies and estimates during the three and nine months ended December 31, 2023 as compared to those described in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023 and filed with the SEC on May 26, 2023.

Current wording

There have been no material changes to our critical accounting policies and estimates during the three months ended June 30, 2024 as compared to those described in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in our Annual Report on Form 10-K for the fiscal year ended March 31, 2024 and filed with the SEC on May 23, 2024.