Fiscal 2027 Second Quarter
Filed Aug 26, 2026Total Revenues of $928.0M, up 18% Year Over Year; Subscription Revenues of $766.8M, up 16% Year Over Year
Revenue, subscription revenue, GAAP operating income, GAAP net income, and non-GAAP operating income all grew year over year. Management said second-quarter results exceeded guidance on all metrics and raised its full-year view across the board.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenuesGAAP | $928.0 million | – | 18% year over year |
| Subscription revenuesGAAP | $766.8 million | – | 16% year over year |
| Professional services and other revenuesGAAP | $161.2 million | – | – |
| Total cost of revenuesGAAP | $232.0 million | – | – |
| Gross profitGAAP | $696.0 million | – | – |
| Gross margin on total revenuesGAAP | 75.0% | – | – |
| Gross margin on total revenuesnon-GAAP | 77.1% | – | – |
| Gross margin on subscription revenuesGAAP | 86.2% | – | – |
| Gross margin on subscription revenuesnon-GAAP | 86.6% | – | – |
| Gross margin on professional services and other revenuesGAAP | 21.6% | – | – |
| Gross margin on professional services and other revenuesnon-GAAP | 31.5% | – | – |
| Research and development expenseGAAP | $222.9 million | – | – |
| Sales and marketing expenseGAAP | $126.7 million | – | – |
| General and administrative expenseGAAP | $71.3 million | – | – |
| Total operating expensesGAAP | $420.9 million | – | – |
| Operating incomeGAAP | $275.0 million | – | 40% year over year |
| Operating marginGAAP | 29.6% | – | – |
| Operating incomenon-GAAP | $415.9 million | – | 18% year over year |
| Operating marginnon-GAAP | 44.8% | – | – |
| Net incomeGAAP | $273.4 million | – | 37% year over year |
| Net incomenon-GAAP | $387.4 million | – | 16% year over year |
| Diluted net income per shareGAAP | $1.66 | – | – |
| Diluted net income per sharenon-GAAP | $2.35 | – | – |
| Net cash provided by operating activitiesGAAP | $238.7 million | – | – |
| Net cash provided by operating activitiesnon-GAAP | $235.4 million | – | – |
| Stock-based compensationGAAP | $136.8 million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Veeva Commercial Solutions subscription revenueReported as a product area within subscription revenues. | $347.4 million | – | – |
| Veeva R&D and Quality Solutions subscription revenueReported as a product area within subscription revenues. | $419.4 million | – | – |
| Veeva Commercial Solutions professional services and other revenueReported as a product area within professional services and other revenues. | $59.7 million | – | – |
| Veeva R&D and Quality Solutions professional services and other revenueReported as a product area within professional services and other revenues. | $101.5 million | – | – |
Fiscal third quarter ending October 31, 2026; fiscal year ending January 31, 2027 outlook
- RevenueFiscal third quarter: between $932 and $935 million. Fiscal year: between $3,682 and $3,687 million.
- NoteFiscal third quarter non-GAAP operating income between $417 and $420 million.
- NoteFiscal third quarter non-GAAP fully diluted net income per share between $2.33 and $2.34.
- NoteFiscal year non-GAAP operating income of about $1,640 million.
- NoteFiscal year non-GAAP fully diluted net income per share of approximately $9.21.
- NoteVeeva is not able to provide GAAP targets for operating income and fully diluted net income per share for the fiscal third quarter or fiscal year because certain excluded items, such as stock-based compensation expense, cannot be reasonably predicted.
Capital returns
- Repurchases of common stock were $472.7 million for the six months ended July 31, 2026.
- Taxes paid related to net share settlement of equity awards were $66.3 million for the six months ended July 31, 2026.
What drove it
- Management said Vault CRM had its best quarter ever.
- More than 180 customers were live on Vault CRM, including five top 20 biopharmas.
- Two top 20 biopharmas and one large enterprise biopharma committed to Vault CRM in August, bringing total top 20 commitments to 12 globally.
- Veeva Falcon had five early adopters and was on track for initial go-lives this year.
- The company acquired Copli in the quarter and launched Veeva Falcon MLR to automate content reviews.
- A large enterprise biopharma selected Veeva EDC, building on its existing eTMF, CTMS, and Study Startup foundation.
- Veeva Safety surpassed 100 total customers and secured its second top 20 biopharma win for Safety Workbench.
- Veeva added more than 30 new Quality customers, driven by 20 or more wins each across QualityDocs, QMS, and Training.
Concerns
- GAAP gross margin on total revenues was 75.0%, compared with 75.3% one year ago, while non-GAAP gross margin was 77.1%, compared with 77.5%.
- GAAP gross margin on professional services and other revenues was 21.6%, compared with 21.9% one year ago. Non-GAAP professional services and other gross margin was 31.5%, compared with 33.4%.
- Deferred revenue was $1.310 billion as of July 31, 2026, compared with $1.489 billion as of January 31, 2026.
- Fiscal third-quarter non-GAAP diluted net income per share guidance of between $2.33 and $2.34 is below the $2.35 reported for the fiscal second quarter.
What to watch
- Execution against fiscal third-quarter total revenue guidance of between $932 and $935 million.
- Progress toward initial Veeva Falcon go-lives this year and adoption of Vault AI agents.
- Additional Vault CRM customer go-lives and conversion of top 20 commitments into deployments.
- Whether gross margin trends improve, particularly in professional services and other revenues.
- Execution against updated fiscal-year total revenue guidance of between $3,682 and $3,687 million and non-GAAP operating income guidance of about $1,640 million.
Balance sheet and cash flow
- Cash and cash equivalents were $1.812 billion as of July 31, 2026, compared with $1.421 billion as of January 31, 2026.
- Short-term investments were $5.431 billion as of July 31, 2026, compared with $5.140 billion as of January 31, 2026.
- Total assets were $9.060 billion as of July 31, 2026, compared with $8.979 billion as of January 31, 2026.
- Total liabilities were $1.629 billion as of July 31, 2026, compared with $1.765 billion as of January 31, 2026.
- Deferred revenue was $1.310 billion as of July 31, 2026, compared with $1.489 billion as of January 31, 2026.
- Net cash provided by operating activities was $1.366 billion for the six months ended July 31, 2026, compared with $1.116 billion for the six months ended July 31, 2025.
- Net cash used in investing activities was $452.3 million for the six months ended July 31, 2026, compared with $441.4 million for the six months ended July 31, 2025.
- Acquisitions, net of cash acquired, were $81.8 million for the six months ended July 31, 2026.
- Net cash used in financing activities was $521.8 million for the six months ended July 31, 2026, compared with net cash provided by financing activities of $136.1 million for the six months ended July 31, 2025.
Analysis
Veeva reported fiscal 2027 second-quarter total revenue of $928.0 million, up 18% year over year, with subscription revenue of $766.8 million, up 16%. GAAP operating income increased 40% to $275.0 million and GAAP net income increased 37% to $273.4 million. Non-GAAP operating income rose 18% to $415.9 million, while non-GAAP diluted net income per share was $2.35, compared with $1.99 a year earlier.
The revenue mix remained subscription-led, with Veeva R&D and Quality Solutions contributing $419.4 million of subscription revenue and Veeva Commercial Solutions contributing $347.4 million. Management highlighted broad activity across Vault CRM, Development Cloud, Quality Cloud, Safety, and Veeva Falcon. The company reported more than 180 live Vault CRM customers, 12 total top 20 commitments globally, five Falcon early adopters, and more than 30 new Quality customers.
Profitability expanded substantially at the GAAP operating-income level, with GAAP operating margin of 29.6% versus 24.8% a year ago. Non-GAAP operating margin was nearly unchanged at 44.8% versus 44.7%. Total GAAP gross margin declined to 75.0% from 75.3%, and professional-services GAAP gross margin declined to 21.6% from 21.9%, making services profitability and the consolidated gross-margin trend notable items for follow-up.
Cash generation was significant over the first six months, with $1.366 billion of GAAP operating cash flow. The company held $1.812 billion in cash and cash equivalents and $5.431 billion in short-term investments as of July 31, 2026. Financing cash flow reflected $472.7 million of share repurchases during the six-month period, while the company also spent $81.8 million on acquisitions, net of cash acquired.
Management said the quarter exceeded guidance on all metrics and raised its fiscal-year outlook. Third-quarter guidance calls for total revenue of between $932 and $935 million, non-GAAP operating income of between $417 and $420 million, and non-GAAP diluted net income per share of between $2.33 and $2.34. Full-year guidance calls for revenue of between $3,682 and $3,687 million, non-GAAP operating income of about $1,640 million, and non-GAAP diluted net income per share of approximately $9.21. The filing does not provide the prior-quarter outlook, so the magnitude of the full-year outlook increase cannot be quantified from the supplied documents.
Management, verbatim
AI is opening up the next big chapter for Veeva and life sciences. Vault CRM had its best quarter ever and Veeva Falcon accelerated rapidly. By bringing together deep industry applications, agents, data, and consulting, we are helping the industry drive new efficiencies from clinical to commercial and deliver better outcomes for patients.
Peter Gassner, CEO
Second quarter results exceeded guidance on all metrics and our view for the full year improved across the board. We continue to execute well across the business while also accelerating innovation and progress in new growth areas.
Brian Van Wagener, CFO
Not in the filing
stated, not guessed- Previous-quarter outlook, so comparisons of actual results with prior guidance are unavailable.
- GAAP operating income and GAAP diluted net income per share guidance for the fiscal third quarter and fiscal year.
- Free cash flow.
- Dividend amount or dividend declaration.
- Debt balance or borrowings.
- Sequential revenue, earnings, margin, and segment-growth comparisons.
- Reported total revenue for Veeva Commercial Solutions and Veeva R&D and Quality Solutions across subscription plus professional services and other revenue.
- Revenue-growth rates for the reported product-area revenue lines.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.