Veeva Systems Q1 2026 Earnings Report

Veeva Systems EPS Results

• Actual EPS: $1.97
• Consensus EPS: $1.74
• Beat/Miss: Beat by +$0.23
• One Year Ago EPS: $1.50

Veeva Systems Revenue Results

• Actual Revenue: $759.04 million
• Expected Revenue: $728.38 million
• Beat/Miss: Beat by +$30.66 million
• YoY Revenue Growth: +16.70%

Veeva Systems Announcement Details

• Quarter: Q1 2026
• Date: 5/28/2025
• Time: After Market Closes
• Conference Call Date: Wednesday, May 28, 2025
• Conference Call Time: 5:00PM ET

Veeva Systems (NYSE:VEEV) provides cloud-based software for the life sciences industry. It offers Veeva Commercial Cloud, a suite of software and analytics solutions, such as Veeva customer relationship management (CRM) that enable customer-facing employees at pharmaceutical and biotechnology companies; Veeva Vault PromoMats, an end-to-end content and digital asset management solution; Veeva Vault Medical that provides source of medical content across multiple channels and geographies; Veeva Crossix, an analytics platform for pharmaceutical brands; Veeva OpenData, a customer reference data solution; Veeva Link, a data application that allows link to generate real-time intelligence; and Veeva Compass includes de-identified and longitudinal patient data for the United States. The company also provides Veeva Development Cloud, a suite of applications for the clinical, regulatory, quality, and safety functions, including Veeva Vault Clinical, Veeva Vault RIM, Veeva Vault Safety, and Veeva Vault Quality; Veeva QualityOne, a quality and document management, and training solution; Veeva RegulatoryOne, a solution that helps companies to manage regulatory submission content; and Veeva Claims addresses the end-to-end product and marketing claims management process. In addition, it offers professional and support services, including implementation and deployment planning and project management; requirements analysis, solution design, and configuration; systems environment management and deployment services; services focused on advancing or transforming business and operating processes related to Veeva solutions; data migration and systems integrations technical consulting services; training on its solutions; and ongoing managed services, such as outsourced systems administration. The company was formerly known as Verticals onDemand, Inc. and changed its name to Veeva Systems Inc. in April 2009. Veeva Systems Inc. was incorporated in 2007 and is headquartered in Pleasanton, California.

Veeva Systems Q1 2026 Earnings Call Transcript

Key Takeaways

• Veeva reported Q1 revenue of $759 million and non-GAAP operating margin of 46%, achieving its calendar 2025 revenue run rate goal of $3 billion.
• Vault CRM adoption accelerated to over 80 live customers with projections to reach 200 live deployments next year, split roughly evenly between new customers and migrations.
• Crossix continues to outperform expectations with over 30% year-over-year growth, driven by usage-based billing in measurement, optimization and audience solutions.
• Veeva.ai, the company’s AI initiative embedded across core applications, is on track to deliver its first CRM agent by year-end and aims to boost life sciences efficiency by approximately 15% by 2030.
• Management noted increased macro uncertainty could pressure smaller biotech funding and services engagements, potentially delaying projects if economic conditions worsen.

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by. My name is Abby, and I will be your conference operator today. At this time, I would like to welcome everyone to the Veeva Systems fiscal twenty twenty six first quarter results conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.

[Operator]

Thank you. And I would now like to turn the conference over to Gunnar Hansen, Senior Director, Investor Relations. You may begin.

[Gunnar Hansen, Senior Director of Investor Relations at Veeva]

Good afternoon, and welcome to Veeva's fiscal twenty twenty six first quarter earnings conference call for the quarter ended 04/30/2025. As a reminder, we posted prepared remarks on Veeva's Investor Relations website just after one p. M. Pacific today. We hope you have had a chance to read them before the call.

[Gunnar Hansen, Senior Director of Investor Relations at Veeva]

Today's call will be used primarily for Q and A. With me today for Q and A are Peter Gassner, our Chief Executive Officer Paul Shawa, EVP Strategy and Brian Van Waggoner, our Chief Financial Officer. During this call, we may make forward looking statements regarding the trends, our strategies and the anticipated performance of the business, including guidance regarding future financial results. These forward looking statements will be based on our current views and expectations and are subject to various risks and uncertainties. Our actual results may differ materially.

[Gunnar Hansen, Senior Director of Investor Relations at Veeva]

Please refer to the risks listed in our earnings release and the risk factors included in our most recent filing on Form 10 ks. Forward looking statements made during the call are being made as of today, 05/28/2025, based on the facts available to us today. If this call is replayed or reviewed after today, the information presented during the call may not contain current or accurate information. Viva disclaims any obligation to update or revise any forward looking statements. We may discuss our guidance on today's call, but we will not provide any further guidance or updates on our performance during the quarter unless we do so in a public forum.

[Gunnar Hansen, Senior Director of Investor Relations at Veeva]

On the call, we may also discuss certain non GAAP metrics that we believe aid in the understanding of our financial results. A reconciliation to comparable GAAP metrics can be found in today's earnings release and in the supplemental investor presentation, both of which are available on our website. With that, thank you for joining us, and I'll turn the call over to Peter.

[Peter Gassner, Founder, CEO & Director at Veeva]

Thank you, Gunnar, and welcome, everyone, to the call. It was a strong start to the year with results above our guidance. Total revenue in the quarter was $759,000,000 and non GAAP operating margin up 46%. Thanks to the team and our customers, we have now achieved our calendar twenty twenty five revenue run rate goal of $3,000,000,000 Although the macro environment is more uncertain today compared to ninety days ago, we have not seen a material change to our financial results or pipeline at this time. Setting our sights on our 02/1930 goals last year has really aligned and energized Veeva.

[Peter Gassner, Founder, CEO & Director at Veeva]

I consider this our best first quarter ever in how we're executing across the company. .Ai is a major initiative and off to a good start. I'm especially excited about the positive impact Veeva dot ai can have on the life sciences industry. We'll now open up the call to your questions.

[Operator]

Thank If you are called upon to ask your question and are listening via speakerphone on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. To be able to take as many questions as possible, we ask that you please limit And our first question comes from the line of Joe Verwink with Baird. Your line is open.

[Joe Vruwink, Senior Research Analyst at Baird]

Great. Thanks for taking my questions. I wanted to start with your perspective on the 200 customers moving to Vault or considering Vault CRM for next year. I imagine many of these are migrations. Have the reasons customers cited behind migration decisions changed at all?

[Joe Vruwink, Senior Research Analyst at Baird]

And the reason I ask is it seems like Veeva at this point has really delivered on a product road map. Once shared, customers can now see things like service center and campaign manager. And you also now have, I would say, more fidelity behind the AI strategy. Are these starting to factor in, into why now, why the decisions? And maybe on the flip side, when customers aren't moving with you, what's coming up in those decisions?

[Paul Shawah, EVP, Strategy at Veeva]

Hey, Joe. This is Paul. Thanks for getting us kicked off here. So just to be clear on on that, remember, one year ago, we were at a handful of customers live. Today, we're at about over 80 customers live.

[Paul Shawah, EVP, Strategy at Veeva]

And I think the number you're referencing is about one year from now where we're on track to be about 200 customers live on Vault CRM. So Vault CRM is going really well. It's working. Now the the why. Why is that?

[Paul Shawah, EVP, Strategy at Veeva]

It's it's better than Veeva CRM. Customers like Veeva CRM, but it's better. And what makes up that 200 number are really two things. It's new customers and it's migrations. So in the quarter, as an example, we added 28 Vault CRM customers to that number and, where we added Vault CRM cost 20, sorry, 28 Vault CRM customers total, And about half of those were migrations, and the other half were, net new customers to Veeva.

[Paul Shawah, EVP, Strategy at Veeva]

So that's how to think about what will make up that 200, new customers and migrations. And the reasons are, everything that we've talked about. It's better. Our AI strategy will have agents in the product by the end of the year. It's the the bringing sales, marketing, and medical together.

[Paul Shawah, EVP, Strategy at Veeva]

We're innovating in a lot of different ways. So new companies wanna get started there, and and other customers wanna want to migrate. In terms of, why customers may not make a decision for Veeva, and we've seen some of this, it it some companies want more of a of a custom type product. So I don't expect that to be the path. We expect to to win and retain the vast majority.

[Joe Vruwink, Senior Research Analyst at Baird]

Okay. That that's great. Thank you, Paul. I guess on the go forward forecast, it's it's an interesting contrast when you get a more dynamic macro but outright strength for Veeva. When you may be hone in on some of the more discretionary aspects of your revenue model, and and I'm thinking about, like, services or or maybe the process audience building, would you expect to see those weaken at this point if there were maybe looming signs of pressure for the second half?

[Joe Vruwink, Senior Research Analyst at Baird]

And is the fact that maybe that pressure isn't being seen factoring into how you think about the rest of the year?

[Peter Gassner, Founder, CEO & Director at Veeva]

That's a pretty nice question. It's Peter. I'll take that one. So, as we mentioned in the prepared remarks, you know, the macro environment is is uncertain, and there's some uncertainty largely caused by the, you know, dynamics in the administration. Now we haven't seen that in our results, and we haven't seen that in our in our pipelines.

[Peter Gassner, Founder, CEO & Director at Veeva]

Not to say that we would or we wouldn't going forward, but we haven't seen it so far. Generally, what we could see is, you know, funding issues could come. If if there's uncertainty, that could come in the small market, the smaller side of the biopharma. So that could, you know, delay projects and things like that and could cause some conservatism in large pharma. But certain things like Crossix, you know, that may not be affected by that because Crossix has a a sort of a shorter business cycle, and it and it's really humming along into into a way to get quick ROI.

[Peter Gassner, Founder, CEO & Director at Veeva]

So I actually don't think it would expect affect Crossix that much, but we'll just have to wait and see how how things play out. Thank you.

[Operator]

And our next question comes from the line of Ken Wong with Oppenheimer. Your line is open.

[Ken Wong, Managing Director at Oppenheimer & Co. Inc.]

Fantastic. Peter, I wanted to perhaps address the the comment you called out in the prepared remarks in terms of, the horizontal market. Seems like you guys have made at least some progress there, and you're moving forward on horizontal CRM. Could you provide us just a little more color in terms of how you're thinking about the approach there, the potential differentiation, and to the extent there's any kind of timeline, that'd be much appreciated.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. That we're pretty excited about that new market. So horizontal business applications, which we announced last year. Now now what we said in the prepared remarks that we're focusing in for our first area in the horizontal CRM. Now that when we look at that, there's many areas that you know, the exact product area, that's something we have to determine inside CRM.

[Peter Gassner, Founder, CEO & Director at Veeva]

The exact customer segments, that's something we have to determine as well. So we'll go through those motions and figure that out. And I'm excited about getting customers. So I hope to have, you know, first customers by the end of the year. I hope to have that.

[Peter Gassner, Founder, CEO & Director at Veeva]

And then you start making the customer successful, and that's really how we've grown our business. It's outside of life sciences. This new market, it's a new it's a different team. It's not gonna be confused with life sciences. It's a different operating model.

[Peter Gassner, Founder, CEO & Director at Veeva]

But the one thing that is common is we can live our values of customer success and employee success and speed and focus just on customer success and product excellence. I'm I'm pretty excited about it actually, what we're gonna do out there. It's a it's a whole new viva out there.

[Ken Wong, Managing Director at Oppenheimer & Co. Inc.]

Appreciate the color. We're looking forward to it as well. And then, Paul, I wanted to maybe dive into the commercial strength, meaningful acceleration there. I I guess, surprising considering most of us view that as as maybe a more mature business. Where are you seeing this outsized growth?

[Ken Wong, Managing Director at Oppenheimer & Co. Inc.]

You called out cross six. Are there other areas of the business, whether it's cross selling something or new products, that's really driving that upside?

[Paul Shawah, EVP, Strategy at Veeva]

Yeah. So you're you're right. I mean, we're we're executing well across the entire commercial area, but I would I would specifically call out cross six. We invested heavily in the product over the last couple of years, and that's paying off in both in the marketing and optimization space, also in audiences. Remember, that can be a little lumpy.

[Paul Shawah, EVP, Strategy at Veeva]

So there can be ups and downs quarter by quarter, but over the long term, that will be a a really nice growth business for us. And, so Crossix did well. And then, of course, we're we're executing well in in all the other areas. CRM is relatively stable, but which is nice momentum as we look across data cloud, and including Link, Compass, early days in those areas, but, but we're executing well.

[Ken Wong, Managing Director at Oppenheimer & Co. Inc.]

Fantastic. Thanks, Paul.

[Operator]

And our next question comes from the line of Brent Bracelin with Piper Sandler. Your line is open.

[Brent Bracelin, Sr. Research Analyst at Piper Sandler Companies]

Thank you. Good afternoon. Maybe for Brian, sticking with commercial strength here, this is the highest growth rate we've seen in kind of three years. And as we double click, you flagged cross X. Any other drivers you would flag?

[Brent Bracelin, Sr. Research Analyst at Piper Sandler Companies]

I know data cloud's early, but is there a contribution there? Any color just given the magnitude of acceleration and highest growth in three years? Any other color would be appreciated. Thanks.

[Brian Van Wagener, Chief Financial Officer at Veeva]

Yeah. Hey, Brent. Really happy with the execution across the business in Q1 and the revenue growth rate that we saw really reflects, I think, broad based execution. We saw strong growth out of our R and D business as well, with guidance for the year now at 19%. So that remains a really strong growth engine for the business.

[Brian Van Wagener, Chief Financial Officer at Veeva]

And then the outperformance in the quarter, as we called out in some of the prepared remarks and you mentioned, was really driven by Crossix, which outperformed our expectations. And within Crossix, predominantly driven by the usage based area of that business. So that can be a little bit lumpy from quarter to quarter, and that's reflected in our guide for the full year. But we're seeing really strong growth out of that business over the long term. It's a business that's growing at more than 30% year over year, and so we think it can continue to contribute meaningfully to our growth over the long term.

[Brent Bracelin, Sr. Research Analyst at Piper Sandler Companies]

Got it. Over 30% growth. Super helpful color there. And then Peter, just a follow-up on horizontal CRM. Again, it's your first area.

[Brent Bracelin, Sr. Research Analyst at Piper Sandler Companies]

Sounds like you're very excited. Why the excitement? And I ask why because you have Salesforce that's kind of a dominant player in in the large enterprise space, and then you have HubSpot that's, kind of emerged on the scene here in in SMB. So what's unique about horizontal CRM that that gets you excited about what Viva's thinking about here? Thanks.

[Peter Gassner, Founder, CEO & Director at Veeva]

It's just unique in that there's so many things we can do. Now I would say Veeva is is more expert at at large market as well as well large enterprises than than we would be, you know, in the QuickBooks type or HubSpot area. So, yeah, I think you'll see us target there, but there's many, many entry points we can go after. And we just think it's it's in need of innovation when we look at the technology that we can bring to it in our business model, our public benefit corporation orientation, we're will be a very differentiated offering. So, we're excited about it.

[Peter Gassner, Founder, CEO & Director at Veeva]

And, you know, it's it's this excitement of getting close to getting our first customers and our first product and, and knowing that we have a great team on it. And, also, I think something what you're hearing is the excitement of some of the fundamental technology breakthroughs, which you're not gonna go into on this call. But, I think people got used to that there's nothing new that you could do. But, actually, there is something new that you can do. So we're pretty excited about it.

[Brent Bracelin, Sr. Research Analyst at Piper Sandler Companies]

Call me intrigued. It'll be interesting to watch. Thank you so much.

[Peter Gassner, Founder, CEO & Director at Veeva]

Thanks.

[Operator]

And our next question comes from the line of Saket Kalia with Barclays. Your line is open.

[Saket Kalia, Managing Director at Barclays Capital]

Okay, great. Hey, guys. Thanks for taking my questions here. Nice start to the year. Peter, maybe for you, just to dig into the Crossix business because it's been mentioned a few times, and it seems like it was one of the main drivers to some of the billing strength outside of FX.

[Saket Kalia, Managing Director at Barclays Capital]

Can we just dig into that? I mean, seems like you're gaining market share. There have been questions just around macro uncertainty and whether customers would be willing to invest as much in tools like that, but this seems to be bucking the trend. Can you go one level deeper into what you think is really driving that strength in Crossix?

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. I at the highest level, I would say it's we're we're growing the product. You know, we we started with clinical back in the day. We had one application and then we had two in the clinical operations, same eTMF and CTMS. Now we have about five major applications in there.

[Peter Gassner, Founder, CEO & Director at Veeva]

The same thing with Crossix. So our Crossix started historically with digital consumer measurement and optimization. Now we're getting starting to get very strong in a two p, health care provider measurement and optimization, and then audiences across both both segments. So our offering is getting more broad and getting more valuable. So when we when we sell a pretty comprehensive cross fixed deal, that value is maybe double in the size of what it was three years ago because the value we we can provide.

[Peter Gassner, Founder, CEO & Director at Veeva]

Then we also are seeing companies really and it's a it's a trend that continues to lean into leveraging their digital spend. So in The United States, if if a company could spend, let's say, $500,000,000 in in digital ad digital advertising, if they could double the value of that, that's very fast ROI. And that's not a a twelve month implementation. Right? That's a very quick implementation.

[Peter Gassner, Founder, CEO & Director at Veeva]

So you're seeing that? Also, you're seeing us take a more strategic approach, meaning the integration with our CRM products and optimizing more for long term agreements rather than than shorter term agreements and just getting higher in the account. So it it's a combination of factors. You know, I'll honestly say it's without a great team on Crossix too. Great leadership, all the way down to the analyst level and the leadership, and they're just executing.

[Peter Gassner, Founder, CEO & Director at Veeva]

They're humming along. So they're they're kinda winning the race.

[Saket Kalia, Managing Director at Barclays Capital]

Got it. That was a super helpful answer. Brian, maybe for my follow-up for you, it's great to see the higher billings guide for the year. I don't think a lot of your folks were expecting that, even excluding the FX tailwind. Can you just maybe dig into some of the drivers there?

[Saket Kalia, Managing Director at Barclays Capital]

Maybe we hit on some of it here with Crossix, but also some of the other drivers there, maybe like billings duration or any other things that you want to flag as we thought about the slightly higher guide for billings for the year.

[Brian Van Wagener, Chief Financial Officer at Veeva]

Hey, Saket. So yes, two major factors, as you mentioned. One is the FX guidance that's flowing through to billings, but then the other is largely the revenue outperformance that we saw in Q1 from the subscription side coming through to billings. There's always a little bit of timing and duration things at the margin, and there's some of that in there, but the main two factors are FX and then the revenue beat.

[Saket Kalia, Managing Director at Barclays Capital]

Super helpful. Thanks, guys.

[Operator]

And our next question comes from the line of Rishi Jaluria with RBC. Your line is open.

[Rishi Jaluria, Managing Director at RBC Capital Markets]

Wonderful. Thanks so much for taking my questions. Maybe two strategically focused ones. Number one, you know, look, I I wanted to think about the CRM business. You've talked about getting into marketing and service, and you came out some initial applications there.

[Rishi Jaluria, Managing Director at RBC Capital Markets]

Maybe can you talk about what you're seeing from early customer feedback and adoption of these? And, you know, at what point, whether it's, you know, in the next year, three years, five years, can we see those actually become share gainers, in the space? Then I've a quick follow-up.

[Paul Shawah, EVP, Strategy at Veeva]

Yeah. Hey, Rishi. So we're early in both of those areas. But but to your point, since we made the move to Vault CRM, we've been able to innovate in totally different ways, new ways, and that includes bringing sales and marketing and service altogether in a single customer database. That that hasn't been done in life sciences.

[Paul Shawah, EVP, Strategy at Veeva]

That's resonating. That's really good for customers. It'll help customers become more customer centric. So this is a significant value proposition, but we're very early days. And the exciting news is we have some early customers in in both of those areas.

[Paul Shawah, EVP, Strategy at Veeva]

We're just getting started. Remember, the requirement is that they're on Vault CRM. So for someone to get started with, let's say, campaign manager or service center, the first step is, is moving migrating to Vault CRM or getting started on Vault CRM. So it's a smaller pool to play in, at least today, and we're gonna focus, which means we'll largely focus on some smaller and midsized customers. But then over time, I expect that we'll we'll make even more progress in the midsize and even in the large companies.

[Paul Shawah, EVP, Strategy at Veeva]

So it's a it's there's a long journey, but we're innovating in a really different way. It's something to be excited about.

[Rishi Jaluria, Managing Director at RBC Capital Markets]

Alright. Wonderful. That's really helpful. And then, Peter, on the AI front, look, I appreciate that you're taking a a more gradual and slow approach to AI versus kind of overpromising and underdelivering, which I I think is always the fear with any new technological wave. Maybe can you walk us through, number one, how you're kind of thinking on AI in life sciences and the willingness to adopt it has evolved?

[Rishi Jaluria, Managing Director at RBC Capital Markets]

And number two, if we think about kind of what this can really unlock for customers over time, Where do you kinda see it shaking out other than, you know, the typical efficiency gains? Because I'm sure that there's a major unlock that you can see over time using AI. Thanks.

[Peter Gassner, Founder, CEO & Director at Veeva]

Mhmm. Yeah. I do. I'm very bullish about what Veeva can what Veeva can bring with AI for the life sciences industry. I think, you know, if you look over the next three, four, five years up to 2030, I think Visa can help increase life sciences efficiency by 15% or so with these AI.

[Peter Gassner, Founder, CEO & Director at Veeva]

That's a huge number when you look at that. So I'm I'm I really think it will be a a step change. Why I'm so bullish on it? Because Eva has the core applications, and we're building the AI very deeply embedded in the core application. So when we build AI, we're not building a generic AI.

[Peter Gassner, Founder, CEO & Director at Veeva]

We're building a medical legal regulatory approval agent, a CRM agent that does pre call planning, a safety AI agent that can transcribe pretext into a safety case, so deep AI application. And you you need the deep core applications and the AI working together, and that's where that's where the magic will happen. It's just very, very, very clear to me. That's that's what I'm excited about. I think we the core technology has settled down a little bit in terms of the large language models, what's going on there.

[Peter Gassner, Founder, CEO & Director at Veeva]

And then it's very clear that this AI is a new computing paradigm. It's it's it's something that can automate certain things that humans can do, which can basic software, traditional software can do that. Doesn't work like a human. This is nondeterministic computing. It can automate some things that a human can do, but it doesn't obviate the need for a core application.

[Peter Gassner, Founder, CEO & Director at Veeva]

So we let the core get settled down of the large language models get settled down. We developed our partner program. We developed our direct data API. Now we got a a specific and separate team working on on Viva.ai, and I I couldn't be more pleased with our positioning, where where we're at right now with AI.

[Rishi Jaluria, Managing Director at RBC Capital Markets]

Very helpful. Thank you so much.

[Operator]

And our next question comes from the line of Brian Peterson with Raymond James. Your line is open.

[Brian Peterson, Managing Director at Raymond James Financial]

Thanks, gentlemen. Congrats on the strong quarter. Paul, I know you talked with a lot of customers and how they're thinking about their go to market motion. I'm curious on the relative prioritization of IT spend, if we think about it in the lens sales versus marketing versus customer service, are any of those areas seeing increased or decreased prioritization in kind of a Gen AI world? Any thoughts on that?

[Paul Shawah, EVP, Strategy at Veeva]

Yeah. Hey, Brian. Thanks for the question. Yeah. So where where is AI, likely to be in in across sales, marketing, or service?

[Paul Shawah, EVP, Strategy at Veeva]

Yeah. Two question. Overall, the way to think about the the farm industry is the human relationships, the sales organizations, spend on the Salesforce is very significant and very meaningful. And if you can provide productivity gains and effectiveness gains for the field team, you have a very significant impact. So I think there's a we're seeing a lot of focus in the sales side, which is why one of our first agents will be in the c r in the core CRM space, the CRM bot.

[Paul Shawah, EVP, Strategy at Veeva]

We think we can make, customers significantly more productive from a field team perspective. So it's not to say that we're not seeing investment in in other areas, certainly customer service. Case intake is an example. There's a lot of examples on the marketing side, but I would prioritize sales higher given the size, the importance, the relationships, and the potential impact worth to have.

[Brian Peterson, Managing Director at Raymond James Financial]

Got it. Appreciate the color. And, Brian, I know in the prepared remarks, Peter mentioned some some ease from some of the customers. I'm curious, as you think about the outlook for the remainder of the year, was there any incremental caution that you factored into the guidance? Thanks, guys.

[Brian Van Wagener, Chief Financial Officer at Veeva]

Thanks, Brian. So without a doubt, I'd say there's more uncertainty today than ninety days ago. And so if that persists, it's not going to have a positive impact on the life sciences industry or on patients. With that said, so much of our business is subscription based. It's in mission critical areas, and the industry that we serve is more long term oriented. So in the short term, we're a bit more insulated from some of those pressures. And as we said in the prepared remarks, we're not really seeing any material impact to our financials or pipeline yet. We've got deals progressing as expected, contracts are renewing, projects are proceeding on or ahead of schedule.

[Brian Van Wagener, Chief Financial Officer at Veeva]

So given all that, our guidance right now assumes that things continue roughly as they are now. That means that there's more uncertainty in the world and the unease that comes with that, but that customers continue to navigate it effectively.

[Operator]

And our next question comes from Stan Berenstain with Wells Fargo Securities. Your line is open.

[Stan Berenshteyn, Senior Equity Research Analyst, Digital Health - Healthcare IT at Wells Fargo]

Hi, thanks for taking my questions. First, maybe going back to Spaslex. We heard recently maybe there's been some pull forward in commercial activity by biopharma into the first half of the year. I'm just curious if you're seeing any signs of this within Prosix. Maybe you can square that with how Prosix has performed year to date versus, same time last year?

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. I'll take that one. This is Peter. I wouldn't say, any particular pull forward we're seeing. You know?

[Peter Gassner, Founder, CEO & Director at Veeva]

I think we're seeing in the case of Crossix, customers just wanting to build up their their digital marketing capabilities, and and part of that is being more more effective on, you know, how where they're putting their campaigns and and their audiences. So I wouldn't say any particular pull forward.

[Stan Berenshteyn, Senior Equity Research Analyst, Digital Health - Healthcare IT at Wells Fargo]

Okay. And then a follow-up on the Compass product. I think it's been a little bit more than a year since, you launched prescriber, national Compass products. I was just hoping to get an update on the adoption and momentum trends, under the segment. Thanks.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. Compass is doing well. We added about 10 brands this quarter, mostly in the patient area, and that that continues to grow. And, you know, it's always said Compass is a marathon. Industry is used to doing things in a certain way with data, and it's it's our business to get into.

[Peter Gassner, Founder, CEO & Director at Veeva]

But we're making good progress there. In terms of prescriber national, I would say we're still definitely in the early adopter area. So we've got a few early adopters. Pipeline's getting a a bit bigger. We're focused on adding to our data network and also focusing on customer success.

[Peter Gassner, Founder, CEO & Director at Veeva]

So in prescriber and national, it's just not a a, like, mature business yet. It's not a business to scale yet, but we're encouraged by what we see from early adopters.

[Stan Berenshteyn, Senior Equity Research Analyst, Digital Health - Healthcare IT at Wells Fargo]

Great. Thanks so much.

[Operator]

And our next question comes from the line of Tyler Radke with Citi. Your line is open.

[Tyler Radke, Director / Senior Equity Research Analyst - Software at Citigroup]

Thank you for taking the questions. Peter, I wanted to start with you on the macro environment. You talked about some of the tariff uncertainty not being great for business, which I think we can all appreciate. But one of the things that that we have heard is some signs of a potential reshoring, in terms of the manufacturing within the the pharma industry. To to what extent, do you how do you view this opportunity?

[Tyler Radke, Director / Senior Equity Research Analyst - Software at Citigroup]

Is this is this a potential tailwind? I know it's potentially ways away, but would just love to hear the conversations you're having with customers and how Veeva could potentially benefit from that.

[Peter Gassner, Founder, CEO & Director at Veeva]

Specifically about the tariffs and the potential reshoring, I wouldn't say that's a headwind or a a tailwind for VBA, actually. There, we're really looking at enterprise type of capabilities in our large customers. And then for small customers, for small biotechs, they they wouldn't generally have multiple manufacturing sites, and they would use contract manufacturers.

[Peter Gassner, Founder, CEO & Director at Veeva]

So I think it's not a not a headwind. There could be a tailwind if if they have to do thing sorry. There could be a headwind if they have to do things that take higher priority. Let's say they have some long term capabilities projects in the quality area that they they wanna get start on, but there's some emergency, you know, reshoring that they have to do that could take strategic focus and delay projects. Now having said that, we've seen no evidence of that so far.

[Tyler Radke, Director / Senior Equity Research Analyst - Software at Citigroup]

Okay. Great. And a follow-up on the, I guess, on updated guidance for the full year. Earlier question was sort of asked, but I guess are you if we think about the change versus ninety days ago, on the revenue and billings guide, are you increasing discount rates or any type of deterioration in closed rate assumptions? Or are you assuming the a consistent macro environment versus ninety days ago?

[Tyler Radke, Director / Senior Equity Research Analyst - Software at Citigroup]

And I think what investors are trying to understand is this was a very solid quarter, but with the raise be even greater had you not seen kind of the macro and, tariff uncertainty, play out in the quarter?

[Brian Van Wagener, Chief Financial Officer at Veeva]

Yes. I think we really have not seen any impact from the macro on the velocity of business, on close rates or those kinds of things. And so what you're seeing in Q1 is, again, that outperformance largely of the Crossix segment and then the timing of services revenue. So that timing, we expect to kind of normalize back out as we go through Q2 to Q4 on services. And so the beat on the Q1 Crossix side really pulls through to the balance of the year, and you see that reflected in the, the billings guide going up as well.

[Brian Van Wagener, Chief Financial Officer at Veeva]

So outside of those factors, I would say the the business is largely as we expected it to be ninety days ago. We're seeing really good execution in in all the areas of the business and feeling really good about the trajectory going forward for the year.

[Operator]

And our next question comes from the line of Craig Hettenbach with Morgan Stanley. Your line is open.

[Craig Hettenbach, Executive Director at Morgan Stanley]

Great. Thank you. Just following up on the macro, what do you think would prove to be most insulated? Like if things do get more difficult into the back half, are there parts of the business you'd expect to be kinda most insulated versus some areas that, you know, you you'd expect to maybe see some impact if if things were to deteriorate?

[Peter Gassner, Founder, CEO & Director at Veeva]

I'll I'll take that one. Hard to estimate too much because, you know, there's multiple ways that things could deteriorate. It could be interest rates. It could be, you know, it could be drug pricing. It could be specific to one country or another.

[Peter Gassner, Founder, CEO & Director at Veeva]

It could be you know, geopolitical conflict. So hard to really speculate there. The most durable part of the business is our our long term subscription contracts because they just don't really get affected by things. Then business consulting engagements, services engagements, those are those are quicker to to get impacted. And if things get, you know, very tough, which we saw a number of years ago, it can impact our really small emerging biotechs, yeah, because they can't get funding until projects would stop.

[Peter Gassner, Founder, CEO & Director at Veeva]

And then sometimes, they may go out of business if the funding environment is dire enough. So the bulk of our business is in these long term subscription projects and that those just aren't susceptible to those short term swings.

[Craig Hettenbach, Executive Director at Morgan Stanley]

That's helpful. Thanks. And just as a follow-up, Peter, understanding it's Viva.ai just recently kinda rolled out. Any initial feedback from customers and and and how you think, you know, in the coming years, how it might impact your overall business?

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. The impact the reception from customers is very positive because it just makes sense. It's it's not a lot of hype. You they need the AI working with the core applications. They know who that cares about the industry will be responsible with the data, and they can see the tangible use cases.

[Peter Gassner, Founder, CEO & Director at Veeva]

So there's a lot of, excitement. How it can move our business forward? I think the AI is something that we will we will charge, you know, an appropriate license fee for. So I think it'll be a a net positive for Vivo. We don't have that packaging worked out yet.

[Peter Gassner, Founder, CEO & Director at Veeva]

We do wanna price it so that it can be very reasonable and and broadly adopted, help the industry move forward. And, yes, that certainly help our revenue over time, but we don't have any specific projections at this time.

[Craig Hettenbach, Executive Director at Morgan Stanley]

Understood. Thank you.

[Peter Gassner, Founder, CEO & Director at Veeva]

Thanks.

[Operator]

And our next question comes from the line of Kirk Materne with Evercore ISI. Your line is open.

[Analyst]

This is Bill on for Kirk,

[William McNamara, Equity Research Senior Associate at Evercore ISI]

and thanks for taking my question. Peter, can you highlight some of the key takeaways from you from the Commercial Summit last week?

[Peter Gassner, Founder, CEO & Director at Veeva]

Sure. Commercial Summit, I would say first thing I would take away, it sounds very basic, but the customer's feeling is good. And I probably had more than 51 on one conversations that were each, you know, five to ten minutes or more each. So you you that's a pretty representative sample size and and non scripted. So customers feeling is good, that means we're executing well.

[Peter Gassner, Founder, CEO & Director at Veeva]

We are we are hiring good people that have the right customer relationships that are confident that are bringing value in our sales services, business consulting, product management. So that's number one, and I think that is not to be underrated because that that is the gift that will bring value over the next five to ten years. The the next one is a whole different vibe around Visa CRM, around Vault CRM. 80 customers live this time versus just a handful last year. Product's mature.

[Peter Gassner, Founder, CEO & Director at Veeva]

Couple big top 20 customers midway in flight. We had one of them zoom in to that. Couldn't actually be there. The person had some things where they couldn't be there at the summit. So they they zoomed in.

[Peter Gassner, Founder, CEO & Director at Veeva]

This is the person, the SVP of of digital from a top 20 pharma that's, you know, confirmed, yes, we'll be live here in a month or so and fully live in all of our, you know, multiple, you know, close to 20,000 people around the world, by the end of the year. So that that was a a whole different vibe there. And then Viva Ai, making it real. When I showed the demo of of Viva dot ai, one example of what Viva dot ai can do with CRM bot, you can just see the moment, go with the customers because, you know, what they want is they want AI to help them with the the engagement planning. Right?

[Peter Gassner, Founder, CEO & Director at Veeva]

Do all that work. And then all the data entry afterwards, do that work so they can focus on the engagement in their field. And you just see the light bulbs going on. And that's what I'm excited about about Veeva AI. I wanna be known as the company that, while they really did AI right, they did in a durable way.

[Peter Gassner, Founder, CEO & Director at Veeva]

It's adding a ton of value where Viva is bringing in $1 and customers are getting $4 of value. And wow. That was done right. So there was that feeling for the first time of it's somewhat relieved because we've been we've been measuring carefully on AI and not jumping in, you know, and and the hyping. So then there you could see that relief from the customer.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. This is the Viva. Here it goes. Right? They have a plan.

[Peter Gassner, Founder, CEO & Director at Veeva]

Now they're starting to execute and making plans around it. So that was the excitement. The and the last thing I'll mention is that our data business data cloud is becoming really real, and people are starting to understand, hey. We have commercial cloud and data cloud, and they they work together. They're modular, but you can connect them.

[Peter Gassner, Founder, CEO & Director at Veeva]

And that's what our commercial solutions are. So Visa, you know, not just the CRM company anymore. When I I remember some years ago on our earnings call multiple years ago, I said, hey. You know, CRM over time will be not the major part of our commercial solutions. And, man, could you see that at Summit.

[Peter Gassner, Founder, CEO & Director at Veeva]

The CRM add on products, marketing, service center, data cloud, cross six, business consulting. CRM is the is the start of our commercial course CRM. So that was you asked a small question. I guess you got more of an answer than you're looking for, but that you can tell the excitement about commercial summit. About 2,000 people there and so many ideas have exchanged.

[Peter Gassner, Founder, CEO & Director at Veeva]

It it was wonderful. I think we should keep doing it. Paul, do you think we should keep doing our summits? Count me in.

[Peter Gassner, Founder, CEO & Director at Veeva]

Paul's not. Absolutely. You think we count you in? Okay. We're gonna keep doing them.

[William McNamara, Equity Research Senior Associate at Evercore ISI]

Yeah. Great. Thanks for that answer. Thank you.

[Peter Gassner, Founder, CEO & Director at Veeva]

Thank you.

[Operator]

And our next question comes from the line of Jayalandra Singh with Truist Securities. Your line is open.

[Jailendra Singh, Managing Director at Truist Securities]

Yes, thank you. Thanks for taking my questions and congrats on a strong quarter. I wanted to ask about the CRM conversion to Vivo Vault CRM. I understand these top 20 pharma companies still have some time before they can decide and you have three top 20 going live in 2026. But compared to your internal expectations, I mean, internal expectations you had like maybe eighteen, twenty four months back, are you surprised by the pace at which these top 20 are coming through?

[Jailendra Singh, Managing Director at Truist Securities]

What are the most common decision making drivers you come across in terms of these top 20 biopharma companies?

[Paul Shawah, EVP, Strategy at Veeva]

Yeah. So so first, I would say overall, we're making great progress in top 20, and we're on track with our expectations, as I think back a year or two years ago on track, maybe even a little bit ahead of what our expectations were. Now you think about what does that timing look like and what is what what makes up that decision making process. Customers are happy with Viva CRM. We're not pushing anybody to move, so there's not really that urgency.

[Paul Shawah, EVP, Strategy at Veeva]

Now, eventually, there will be. We've talked about their their the red zone, which starts to kick in in that 2027 time frame, particularly if you're a large customer, top 20 company, you wanna make a decision before that 2027 time frame, which is why we've said most large companies will make decisions either in 2025 or in 2026. So they'll have plenty of time to to migrate and move. So, customers are happy. They're in they're gonna gonna make that decision when when they're ready.

[Paul Shawah, EVP, Strategy at Veeva]

We're not doing anything unnatural to force them into a specific timeline. Now the ones that have made decisions already, and there's four that have publicly announced or four top twenties, I should say, that have publicly announced their decision, they wanna move fast. They want to get to all of the innovation that you heard us talking about, and they want to get this behind them and and be able to take advantage of things like Viva dot ai, our sales and marketing and medical and bringing all those pieces together and and all the innovation, all the excitement. So we're we're doing this in a customer friendly way. We're excited with the progress.

[Paul Shawah, EVP, Strategy at Veeva]

I think we're I think we're very much on track.

[Jailendra Singh, Managing Director at Truist Securities]

Okay. And then, Mike, a quick follow-up, on the topic of takeaways from the Viva Commercial Summit. Thanks for all that color. Very helpful. But as you compare to the conversations you were having like last year's summit, did you guys come across like pharma executives having increased focus on ROI, budget priorities?

[Jailendra Singh, Managing Director at Truist Securities]

Or is it more or less same as compared to last year?

[Peter Gassner, Founder, CEO & Director at Veeva]

In terms of the feeling from the customers, similar to last year, I think they have last year, there was still, you know, some uncertainty how know, how the administration was gonna pull. There was a US presidential election, things like that. So that that uncertainty, in in a way, is gone because they have a new new environment that they're working in. But similar in that they're, you know, they're focused on execution. And I think leaning into the digital a bit more.

[Peter Gassner, Founder, CEO & Director at Veeva]

That's one thing I noticed, leading into the digital marketing a bit more and the data and analytics. So getting getting more systematic, a bit more systematic in commercial.

[Jailendra Singh, Managing Director at Truist Securities]

Got it. Thank you.

[Operator]

And ladies and gentlemen, to be able to take all of our remaining questions in the time we have left, we ask that you please limit yourself to one question going forward. Our next question comes from the line of Jeff Garo with Stephens. Your line is open.

[Jeff Garro, Managing Director at Stephens Inc]

Yes, good afternoon. Thanks for taking the question. Follow-up on that last one and also some earlier ones on the momentum for Crossix. I was hoping you could discuss the mix of customers' commercial focus on digital versus in person spend and and how Veeva is is particularly differentiated there to to to enable both digital and and in person commercial activities and and help your customers evaluate the effectiveness of both? Thanks.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. In in terms of the mix mix, I didn't I didn't notice or sense any, you know, broad change in mix. Now we're not always in those discussions, but I didn't notice in them anymore. But what I did notice is, hey. Using technology, particularly Crossix, can I say have the same amount of spend in in digital and, you know, double the impact?

[Peter Gassner, Founder, CEO & Director at Veeva]

Right? That's that's really, what CrossFit is about. Now in terms of the field or the CRM, I think there's a lot of excitement about AI to say, you know, it's not easy to ramp up or ramp down my field force. So what I can do is I'd like to keep that field course the same roughly and just get more productivity out of my out of out of my team as I have more launches and more more content. So I think that's that's what I'm I'm seeing there.

[Operator]

And our next question comes from the line of Andrew DeGasperi with BNP Paribas. Your line is open.

[Andrew Degasperi, Director - Senior Software Analyst at BNP Paribas]

Thanks for taking my question. Maybe as a follow-up to the horizontal CRM product. You mentioned it's a different team. I guess I'm wondering, number one, as the have those investments been made in terms of people and headcount? Is that already in place?

[Andrew Degasperi, Director - Senior Software Analyst at BNP Paribas]

And then secondly, is is m and a on the horizon for this particular product, or is this something probably related to to another opportunity? Thanks.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. The the core core team is in place. Of course, we'll be adding to that team incrementally when you you have to keep the team small at first so it can, you know, execute with really fast, speed and and quality on the foundations. Then you incrementally add to that team, and I'm sure we'll be doing that over the next, you know, two, three, you know, year, two, three, four years. So that's that's normal, and we have a a heartbeat for that.

[Peter Gassner, Founder, CEO & Director at Veeva]

And I'm sorry. So that was about the team. And then you you asked the second question. I didn't I didn't catch it.

[Andrew Degasperi, Director - Senior Software Analyst at BNP Paribas]

Oh, it was it was on the m and a. I know you mentioned this would be an area that you would focus on. I'm just wondering if your the m and a will be focused on the CRM product, or would it be for other areas?

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. We're yep. For m and a, we're keeping a really wide aperture on that. If we can see something that would be synergistic with Veeva, most likely, that would that would be in the, you know, area that is horizontal applications. It could be CRM, could be other things.

[Peter Gassner, Founder, CEO & Director at Veeva]

You know, we we would look at that. We've been very disciplined on our acquisitions, and we've not had any failed acquisitions, and that's that's unusual. But we we like acquisitions like Crossix where we can where we can really, create a lot of value and create a lot of innovation. So that's the type of thing we that we'd be looking for outside of Life Sciences. It could be in CRM, it could be in a different area.

[Andrew Degasperi, Director - Senior Software Analyst at BNP Paribas]

Thanks.

[Operator]

And our next question comes from the line of Gabriela Borges with Goldman Sachs. Your line is open.

[Gabriela Borges, Analyst at Goldman Sachs]

Hi, good afternoon. Thank you for taking the question. I'd like to follow-up on some of the positive commentary on eTMF with asking about an update for EDC. Peter, perhaps you could comment how are some of those conversations progressing on new customers for EDC? And any updated color on how we should think about the ramp of revenue for the customer wins that you've already announced? Thank you.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. You touched on the eTMF, and I'll just spend a little bit there. We're really excited about that. The nineteenth top 20, and and we feel like we have a pretty good path to have 20 of the top 20 on each and that's that's just amazing, and we view that as just an honor. And what we wanna do when we get that simplification and standardization to the industry is just double down and invest and help the industry get more efficient.

[Peter Gassner, Founder, CEO & Director at Veeva]

So I want the whole Viva team to to know and and yourselves as investors and our customers to know is that's a signal to Veeva to really double down on investment. That's the type of company Veeva is. We we view that as a privilege. So each and that is there, and I'm confident over time, actually, you know, EEC will get there. I think but it will take time.

[Peter Gassner, Founder, CEO & Director at Veeva]

Today, have nine out of the top 20 are using our EDC. Now some of those are very early, and those are multiyear ramp deals. I think we have a path to additional top twenties in EDC. I don't I don't see anything imminent, right away, but, I'm sure customer success will will get there over time because we have a structural advantage. People wanna integrate a clinical platform in the clinical operations, the clinical data management, even reaching out to the research site.

[Peter Gassner, Founder, CEO & Director at Veeva]

So if we keep executing, our future is very bright and clinical.

[Operator]

Thank And our next question comes from the line of Alan Verkoski with Scotiabank.

[Allan Verkhovski, Associate Director - Equity Research at Scotiabank]

Hey, guys. Congrats from me as well on the great quarter. I want to just double click on how you mentioned discussions with customers are starting to reflect the general unease. Can you just give more color on how that developed through the quarter? What types of customers are expressing this more?

[Allan Verkhovski, Associate Director - Equity Research at Scotiabank]

Would just, in general, appreciate more color on this. Thank you.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. Now that color is, you know, things that we get in personal conversations, mainly one on one conversations sometimes by Zoom, sometimes in person. So it's not anything that shows up in the financial results or the pipeline. So as you would expect, it's multifaceted. Some people are concerned about drug launches and they're they're about what's called their PDUFA date, their approvals.

[Peter Gassner, Founder, CEO & Director at Veeva]

And and they see some open vacancies in the FDA and they wonder who's gonna fill those and whether they're gonna fill those in time. So they they have a little logic in there. There's people concerned about what types of acquisitions they might do. And if they might do them, well, is there gonna be an impact on drug pricing down due to the executive order? Because that may that may, you know, deter or accelerate their their plans for for acquisition.

[Peter Gassner, Founder, CEO & Director at Veeva]

So the it's it's just broad broad based across life sciences. And then for the smaller biotechs, what they would be wondering about is how is this gonna affect the funding environment? It's pretty dynamic with, you know, which way will interest rates go and how will this affect funding and they're and they're watching the price of bonds and things. And they're wondering, well, when we need another round, are we gonna get it? So should we need to be more conservative or not?

[Peter Gassner, Founder, CEO & Director at Veeva]

So those are the type of discussions. It's varied, not not dominated by one particular topic.

[Operator]

And our next question comes from the line of Steven Valiquette with Mizuho Securities. Your line is open.

[Steven Valiquette, MD & Senior Equity Research Analyst - Covering Health Care Technology & Distribution at Mizuho Securities]

Good afternoon, Peter and Brian. Let me offer my congrats on the strong results as well. Really for me just a financial question. The 79% non GAAP gross margin and 46% operating margin were obviously pretty strong in the fiscal first quarter. And the guidance for the fiscal second quarter for the full year imply that the margins will come back down a little bit relative to the F1Q trend.

[Steven Valiquette, MD & Senior Equity Research Analyst - Covering Health Care Technology & Distribution at Mizuho Securities]

So I guess just about getting too specific, is there anything high level you can point out one or two factors that just mechanically might bring the margins back down in the remainder of the year versus fiscal 1Q? Thanks.

[Brian Van Wagener, Chief Financial Officer at Veeva]

Yes. Hey, Steven. Q1 was a great quarter for the CollectiveViva team, and you saw that reflected in the margins. The part that doesn't always show up in the margins is the impact that we'll see in years to come. When you look at the margins specifically in the quarter, about three quarters of the outperformance was driven by revenue.

[Brian Van Wagener, Chief Financial Officer at Veeva]

And so that was mostly the usage based elements of Crossix and the faster timing of services delivery. So things that we don't expect to be a recurring benefit to margins through the balance of the year. We also saw some benefit from expenses, which was really timing related factors as well, things that occurred later than we'd otherwise expected. And so when you put all that together, we saw a high watermark for margins in Q1, and then we see it return back to 44% in Q2, which is about what we expect for the balance of the year.

[Steven Valiquette, MD & Senior Equity Research Analyst - Covering Health Care Technology & Distribution at Mizuho Securities]

Okay. Thanks.

[Operator]

And our next question comes from the line of David Larson with BTIG. Your line is open.

[David Larsen, Managing Director at BTIG]

Hi. With regards to Crossix, you mentioned investments into Crossix and you mentioned the word provider. Just with respect to the actual data itself, does it include, like, obviously, the retail sort of data, but does it also include, the specialty script data, for medications that could be supplied in a hospital? Does it include, like, like, part b drugs, drugs administered in a clinic and a skilled nursing facility? And then when you use the word provider, would that also include, like, facility data?

[David Larsen, Managing Director at BTIG]

So if a hospital wants to look at all of their volumes, inpatient ambulatory and so forth, is that also including Crossix or or are there plans to eventually include it there? Thank you.

[Peter Gassner, Founder, CEO & Director at Veeva]

Yeah. The data sources, the data network which, supports Crossix and it also supports Compass, It does work for retail specialty drugs, specialty pharmacy administered in the hospital, all all the types of drugs. And especially it's good at what we call complex therapy. And those are are definitely ones that are, you know, you're not just going to the retail pharmacy and and picking picking them up. That's one of the very unique things about our data sourcing strategy.

[Peter Gassner, Founder, CEO & Director at Veeva]

So for example, Encompass. I know you asked about CrossFit, but for example, Encompass, we can project we project data, sales data for about 4,000 brands across retail and non retail, and we can do that because of our data sourcing strategy. That data sourcing strategy makes us able to do great measurement and audiences also on crossings. So in crossings, what you're trying to do is, you know, figure out what segments you want to expose to media, and then was that effective? At which at at which media points was that effective at driving visits to health care providers and then resulting in the uptake of the right medicine.

[Peter Gassner, Founder, CEO & Director at Veeva]

So it's a pretty comprehensive data network. That's what we set out to build when we acquired Crossix about five years ago, it's really, really great to see it coming to fruition now.

[David Larsen, Managing Director at BTIG]

Okay. Great. Thanks very much.

[Peter Gassner, Founder, CEO & Director at Veeva]

Thank you.

[Operator]

And our next question comes from the line of Faith Brunner with William Blair. Your line is open.

[Faith Brunner, Equity Research Associate at William Blair]

Hey, guys. Thanks for taking my question. I guess, just diving into Summit again, you said that customers are feeling good about Viva. But maybe from a broader industry perspective, what challenges were they bringing to you? What's top of mind for them?

[Faith Brunner, Equity Research Associate at William Blair]

And has there been any shift when you compare the conversations you've had back in April to maybe more recent conversations you've had recently as we continue to try to navigate the changing effect?

[Paul Shawah, EVP, Strategy at Veeva]

Yeah. So I'll I'll take that. Yeah. It's a it's a good one. Challenges and and how's that shifted over time? So remember where the industry is. They they've been in a place where in the commercial side, we've helped many companies be able to connect up a lot of their software systems. We're now we're going through the migration process, so that's certainly a big topic of conversation.

[Paul Shawah, EVP, Strategy at Veeva]

But we the industry still has fragmented data. And getting the data to work together, getting the data into the software so you can make decisions and you can get insights fast about that, that is still a challenge It's not a soft problem yet. So the topic of our can you hear Peter talk about this? Connected software, connected data, that's resonating.

[Paul Shawah, EVP, Strategy at Veeva]

And it's a challenge that it's very clearly an unsolved problem in the industry. And our approach to that, harmonizing the datasets, harmonizing it with the software, fundamentally solving it at a very foundational level, the data model, consistency here of data attributes, elements across all these different datasets creating this connected environment. So that that's top of mind, and that leads to things like helping them be more efficient, helping them get insights to the right people faster to make decisions, helping them do AI. So that's an area. And then second is, we talked a lot about the excitement around AI, but there's also a lot of unsolved problems in the AI space.

[Paul Shawah, EVP, Strategy at Veeva]

And part of that is bringing together or the industry hasn't yet been able to bring together very industry specific processes with with deep industry specific AI. That's a problem that they've made investments. They haven't often seen the full return on their investment in some of the AI projects, and I think that's another area where they're excited about our ability to help them over over time. So those are some specific examples.

[Faith Brunner, Equity Research Associate at William Blair]

That's helpful. Thank you.

[Operator]

And that concludes our question and answer session. I will now turn the conference back over to Mr. Peter Gaffner for closing remarks.

[Peter Gassner, Founder, CEO & Director at Veeva]

Thank you, everyone, for joining the call today, and thank you to our customers for your continued partnership and to the Veeva team for your outstanding work in the quarter. Thank you.

[Operator]

And ladies and gentlemen, this concludes today's call, and we thank you for your participation. You may now disconnect.

Participants

Executives

• Peter Gassner, Founder, CEO & Director

Analysts

• Gunnar Hansen, Senior Director of Investor Relations at Veeva
• Joe Vruwink, Senior Research Analyst at Baird
• Paul Shawah, EVP, Strategy at Veeva
• Ken Wong, Managing Director at Oppenheimer & Co. Inc.
• Brent Bracelin, Sr. Research Analyst at Piper Sandler Companies
• Brian Van Wagener, Chief Financial Officer at Veeva
• Saket Kalia, Managing Director at Barclays Capital
• Rishi Jaluria, Managing Director at RBC Capital Markets
• Brian Peterson, Managing Director at Raymond James Financial
• Stan Berenshteyn, Senior Equity Research Analyst, Digital Health - Healthcare IT at Wells Fargo
• Tyler Radke, Director / Senior Equity Research Analyst - Software at Citigroup
• Craig Hettenbach, Executive Director at Morgan Stanley
• Analyst
• William McNamara, Equity Research Senior Associate at Evercore ISI
• Jailendra Singh, Managing Director at Truist Securities
• Jeff Garro, Managing Director at Stephens Inc
• Andrew Degasperi, Director - Senior Software Analyst at BNP Paribas
• Gabriela Borges, Analyst at Goldman Sachs
• Allan Verkhovski, Associate Director - Equity Research at Scotiabank
• Steven Valiquette, MD & Senior Equity Research Analyst - Covering Health Care Technology & Distribution at Mizuho Securities
• David Larsen, Managing Director at BTIG
• Faith Brunner, Equity Research Associate at William Blair