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      Veeva Announces Fiscal 2023 Second Quarter Results


      News provided by

      Veeva Systems

      Aug 31, 2022, 16:05 ET

      Share this article

      Share this article


      Total Revenues of $534.2M, up 17% Year Over Year; Subscription Services Revenues of $428.6M, up 17% Year Over Year

      PLEASANTON, Calif., Aug. 31, 2022 /PRNewswire/ -- Veeva Systems Inc. (NYSE: VEEV), a leading provider of industry cloud solutions for the global life sciences industry, today announced results for its second quarter ended July 31, 2022.

      "Our innovation engine is delivering more value to our customers than ever as we continue making progress with established and newly launched products in commercial and R&D," said CEO Peter Gassner. "We are early in a large and growing opportunity and look forward to expanding our position as the strategic technology partner to the life sciences industry across their most critical functions."

      Fiscal 2023 Second Quarter Results:
      • Revenues: Total revenues for the second quarter were $534.2 million, up from $455.6 million one year ago, an increase of 17% year over year. Subscription services revenues for the second quarter were $428.6 million, up from $366.4 million one year ago, an increase of 17% year over year.
      • Operating Income and Non-GAAP Operating Income(1): Second quarter operating income was $101.1 million, compared to $124.6 million one year ago, a decrease of 19% year over year. Non-GAAP operating income for the second quarter was $202.0 million, compared to $191.6 million one year ago, an increase of 5% year over year.
      • Net Income and Non-GAAP Net Income(1): Second quarter net income was $90.6 million, compared to $108.9 million one year ago, a decrease of 17% year over year. Non-GAAP net income for the second quarter was $166.2 million, compared to $152.7 million one year ago, an increase of 9% year over year.
      • Net Income per Share and Non-GAAP Net Income per Share(1): For the second quarter, fully diluted net income per share was $0.56, compared to $0.67 one year ago, while non-GAAP fully diluted net income per share was $1.03, compared to $0.94 one year ago.

      "Veeva's durable business model delivered another quarter of solid revenue growth and strong profitability," said CFO Brent Bowman. "We are very confident in our competitive position and we are performing well financially as we track ahead of our 2025 targets."

      Recent Highlights:
      • Leading Through Innovation in Commercial — Veeva continues to expand its leadership through product excellence and customer success in core and new product areas. This quarter saw a significant Veeva CRM release with major innovations to optimize content use across channels to enable efficient and compliant hybrid engagement models.
      • A Record Number of Customers for Veeva Quality — This quarter saw a major milestone with Veeva Vault Quality, as more than 500 customers are now using at least one Vault Quality Suite product, including more than 200 Vault Training customers. Strong momentum in the second quarter included a record 52 Vault Quality customer wins and significant progress on Vault QMS projects with enterprise customers. New product innovations in Vault LIMS and Vault Validation Management are progressing well and will start working with early-adopter customers later this year.
      • Groundbreaking Insights from Veeva Business Consulting — Veeva Business Consulting published the Veeva Pulse Field Trends Report, a first-ever industrywide view of global customer engagement based upon more than 130 million quarterly HCP interactions. With a unique foundation of data-driven insights and a deep knowledge of Veeva products, Veeva Business Consulting had a record revenue quarter and is quickly becoming a strategic resource to help customers realize their digital transformation.
      • Victory for Employee Rights and the Industry — In a major win for employee rights and the life sciences industry, a federal court dismissed the baseless trade secret lawsuit Medidata filed against Veeva in 2017, blocking Medidata's attempt to stifle innovation and free flow of talent. Finding that Medidata was unable to substantiate its claims against Veeva, the judge ended the proceedings and rejected the suit midway through the jury trial. Veeva has been a long-standing supporter of employee rights and the movement to ban the use of non-compete agreements. Medidata's abusive lawsuit further underscores the need for greater protection of worker rights to freely change employers, which promotes fair competition and economic growth.
      Financial Outlook:

      Veeva is providing guidance for its fiscal third quarter ending October 31, 2022 as follows:

      • Total revenues between $545 and $547 million.
      • Non-GAAP operating income between $209 and $211 million(2).
      • Non-GAAP fully diluted net income per share between $1.07 and $1.08(2).

      Veeva is providing updated guidance for its fiscal year ending January 31, 2023 as follows:

      • Total revenues between $2,140 and $2,145 million.
      • Non-GAAP operating income of about $820 million(2).
      • Non-GAAP fully diluted net income per share of approximately $4.17(2).
      Conference Call Information

      Prepared remarks and an investor presentation providing additional information and analysis can be found on Veeva's investor relations website at ir.veeva.com. Veeva will host a Q&A conference call at 2:00 p.m. PT today, August 31, 2022, and a replay of the call will be available on Veeva's investor relations website.

      What:

      Veeva Systems Fiscal 2023 Second Quarter Results Conference Call

      When:

      Wednesday, August 31, 2022

      Time:

      2:00 p.m. PT (5:00 p.m. ET)

      Online Registration:

      https://conferencingportals.com/event/badXudFz



      Webcast:

      ir.veeva.com








      (1)

      This press release uses non-GAAP financial metrics that are adjusted for the impact of various GAAP items. See the section titled "Non-GAAP Financial Measures" and the tables entitled "Reconciliation of GAAP to Non-GAAP Financial Measures" below for details.



      (2)

      Veeva is not able, at this time, to provide GAAP targets for operating income and fully diluted net income per share for the third fiscal quarter ending October 31, 2022 or fiscal year ending January 31, 2023 because of the difficulty of estimating certain items excluded from non-GAAP operating income and non-GAAP fully diluted net income per share that cannot be reasonably predicted, such as charges related to stock-based compensation expense and amortization of purchased intangibles. The effect of these excluded items may be significant.

      About Veeva Systems

      Veeva is the global leader in cloud software for the life sciences industry. Committed to innovation, product excellence, and customer success, Veeva serves more than 1,000 customers, ranging from the world's largest pharmaceutical companies to emerging biotechs. As a Public Benefit Corporation, Veeva is committed to balancing the interests of all stakeholders, including customers, employees, shareholders and the industries it serves. For more information, visit veeva.com.

      Veeva uses its ir.veeva.com website as a means of disclosing material non-public information, announcing upcoming investor conferences, and for complying with its disclosure obligations under Regulation FD. Accordingly, you should monitor our investor relations website in addition to following our press releases, SEC filings, and public conference calls and webcasts.

      Forward-looking Statements

      This release contains forward-looking statements regarding Veeva's expected future performance and, in particular, includes quotes from management and guidance provided as of August 31, 2022 about Veeva's expected future financial results. Estimating guidance accurately for future periods is difficult. It involves assumptions and internal estimates that may prove to be incorrect and is based on plans that may change. Hence, there is a significant risk that actual results could differ materially from the guidance we have provided in this release and we have no obligation to update such guidance. There are also numerous risks that have the potential to negatively impact our financial performance, including as a result of competitive factors, customer decisions and priorities, events that impact the life sciences industry, issues related to the security or performance of our products, the pandemic, issues that impact our ability to hire, retain and adequately compensate talented employees, fluctuations in foreign currency exchange rates, and general macroeconomic and geopolitical events (including inflationary pressures and impacts related to Russia's invasion of Ukraine). We have summarized what we believe are the principal risks to our business in a section titled "Summary of Risk Factors" on pages 37 and 38 in our filing on Form 10-Q for the period ended April 30, 2022 which you can find here. Additional details on the risks and uncertainties that may impact our business can be found in the same filing on Form 10-Q and in our subsequent SEC filings, which you can access at sec.gov. We recommend that you familiarize yourself with these risks and uncertainties before making an investment decision.

      Investor Relations Contact:
      Ato Garrett
      Veeva Systems Inc.
      925-271-4204
      [email protected]

      Media Contact:
      Maria Scurry
      Veeva Systems Inc.
      781-366-7617
      [email protected]

      VEEVA SYSTEMS INC.
      CONDENSED CONSOLIDATED BALANCE SHEETS
      (In thousands)
      (Unaudited)



      July 31,
      2022


      January 31,
      2022

      Assets




      Current assets:




      Cash and cash equivalents

      $      1,140,246


      $      1,138,040

      Short-term investments

      1,778,861


      1,238,064

      Accounts receivable, net

      313,219


      631,134

      Unbilled accounts receivable

      77,778


      63,266

      Prepaid expenses and other current assets

      46,038


      36,679

      Total current assets

      3,356,142


      3,107,183

      Property and equipment, net

      52,409


      54,495

      Deferred costs, net

      27,877


      33,106

      Lease right-of-use assets

      58,539


      49,640

      Goodwill

      439,877


      439,877

      Intangible assets, net

      92,288


      101,940

      Deferred income taxes

      62,059


      5,097

      Other long-term assets

      27,392


      25,127

      Total assets

      $      4,116,583


      $      3,816,465





      Liabilities and stockholders' equity




      Current liabilities:




      Accounts payable

      $           30,915


      $           20,348

      Accrued compensation and benefits

      36,609


      33,834

      Accrued expenses and other current liabilities

      30,714


      36,109

      Income tax payable

      5,143


      7,761

      Deferred revenue

      684,642


      731,746

      Lease liabilities

      11,366


      10,981

      Total current liabilities

      799,389


      840,779

      Deferred income taxes

      1,657


      2,216

      Lease liabilities, noncurrent

      52,106


      43,607

      Other long-term liabilities

      19,500


      18,226

      Total liabilities

      872,652


      904,828

      Stockholders' equity:




      Class A common stock

      2


      2

      Class B common stock

      —


      —

      Additional paid-in capital

      1,353,502


      1,196,547

      Accumulated other comprehensive loss

      (27,335)


      (11,958)

      Retained earnings

      1,917,762


      1,727,046

      Total stockholders' equity

      3,243,931


      2,911,637

      Total liabilities and stockholders' equity

      $      4,116,583


      $      3,816,465

      VEEVA SYSTEMS INC.
      CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
      (In thousands, except per share data)
      (Unaudited)



      Three months ended
      July 31,


      Six months ended
      July 31,


      2022


      2021


      2022


      2021

      Revenues:








      Subscription services(3)

      $ 428,649


      $ 366,436


      $ 831,281


      $  707,555

      Professional services and other(4)

      105,569


      89,158


      208,039


      181,612

      Total revenues

      534,218


      455,594


      1,039,320


      889,167

      Cost of revenues(5):








      Cost of subscription services

      64,035


      53,909


      122,988


      105,126

      Cost of professional services and other

      87,634


      68,188


      168,196


      133,107

      Total cost of revenues

      151,669


      122,097


      291,184


      238,233

      Gross profit

      382,549


      333,497


      748,136


      650,934

      Operating expenses(5):








      Research and development

      134,008


      94,899


      247,483


      178,125

      Sales and marketing

      89,617


      71,789


      165,732


      136,399

      General and administrative

      57,832


      42,185


      106,157


      83,340

      Total operating expenses

      281,457


      208,873


      519,372


      397,864

      Operating income

      101,092


      124,624


      228,764


      253,070

      Other income, net

      8,398


      1,666


      11,107


      6,230

      Income before income taxes

      109,490


      126,290


      239,871


      259,300

      Provision for income taxes

      18,889


      17,432


      49,155


      34,875

      Net income

      $   90,601


      $ 108,858


      $ 190,716


      $  224,425

      Net income per share:








      Basic

      $       0.58


      $       0.71


      $       1.23


      $       1.47

      Diluted

      $       0.56


      $       0.67


      $       1.17


      $       1.38

      Weighted-average shares used to compute net income per share:








      Basic

      154,951


      153,090


      154,736


      152,768

      Diluted

      162,132


      162,765


      162,499


      162,636

      Other comprehensive income:








      Net change in unrealized loss on available-for-sale investments

      $    (2,224)


      $       (217)


      $  (13,223)


      $    (1,303)

      Net change in cumulative foreign currency translation loss

      (900)


      (165)


      (2,154)


      (2,378)

      Comprehensive income

      $   87,477


      $ 108,476


      $ 175,339


      $  220,744









      (3) Includes subscription services revenues from the following product areas:








      Veeva Commercial Solutions(6)

      $ 236,356


      $ 218,128


      $ 464,080


      $  425,973

      Veeva R&D Solutions(6)

      192,293


      148,308


      367,201


      281,582

      Total subscription services

      $ 428,649


      $ 366,436


      $ 831,281


      $  707,555









      (4) Includes professional services and other revenues from the following product areas:








      Veeva Commercial Solutions(6)

      $   44,424


      $   38,968


      $   87,745


      $   82,567

      Veeva R&D Solutions(6)

      61,145


      50,190


      120,294


      99,045

      Total professional services and other

      $ 105,569


      $   89,158


      $ 208,039


      $  181,612

      (6) Certain prior period revenues have been adjusted to match current period presentation.









      (5) Includes stock-based compensation as follows:








      Cost of revenues:








      Cost of subscription services

      1,693


      1,316


      $     2,970


      2,222

      Cost of professional services and other

      13,818


      9,541


      $   23,808


      16,963

      Research and development

      38,901


      22,315


      64,724


      39,152

      Sales and marketing

      24,031


      15,115


      40,924


      26,670

      General and administrative

      17,599


      14,098


      30,750


      25,867

      Total stock-based compensation

      $   96,042


      $   62,385


      $ 163,176


      $  110,874

      VEEVA SYSTEMS INC.
      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
      (In thousands)
      (Unaudited)



      Three months ended
      July 31,


      Six months ended
      July 31,


      2022


      2021


      2022


      2021

      Cash flows from operating activities








      Net income

      $       90,601


      $     108,858


      $     190,716


      $     224,425

      Adjustments to reconcile net income to net cash provided by operating activities:








      Depreciation and amortization

      7,228


      6,880


      14,286


      13,508

      Reduction of operating lease right-of-use assets

      3,020


      2,874


      5,968


      5,701

      (Accretion) amortization of discount on short-term investments

      (507)


      1,743


      549


      3,285

      Stock-based compensation

      96,042


      62,385


      163,176


      110,874

      Amortization of deferred costs

      5,736


      6,474


      11,729


      12,829

      Deferred income taxes

      (20,881)


      6,953


      (53,313)


      12,195

       Loss on foreign currency from mark-to-market derivative

      1,768


      2


      1,186


      433

      Bad debt (recovery) expense

      146


      (22)


      121


      137

      Changes in operating assets and liabilities:








      Accounts receivable

      16,312


      (21,409)


      317,794


      280,323

      Unbilled accounts receivable

      (15,807)


      267


      (14,512)


      (3,894)

      Deferred costs

      (3,421)


      (3,802)


      (6,500)


      (8,092)

      Other current and long-term assets

      (3,513)


      (3,866)


      (11,076)


      (1,129)

      Accounts payable

      5,540


      5,031


      10,661


      (1,763)

      Accrued expenses and other current liabilities

      (475)


      2,216


      (2,811)


      9,183

      Income taxes payable

      (45,841)


      (3,726)


      (2,618)


      (17)

      Deferred revenue

      (39,998)


      (49,783)


      (47,469)


      (57,959)

      Operating lease liabilities

      (3,081)


      (2,913)


      (5,112)


      (5,661)

      Other long-term liabilities

      517


      903


      1,638


      3,072

      Net cash provided by operating activities

      93,386


      119,065


      574,413


      597,450

      Cash flows from investing activities








      Purchases of short-term investments

      (433,073)


      (422,680)


      (1,005,417)


      (679,618)

      Maturities and sales of short-term investments

      250,531


      187,324


      446,721


      408,969

      Acquisitions, net of cash and restricted cash acquired

      —


      (2,133)


      —


      (2,133)

      Long-term assets

      (1,663)


      (5,325)


      (3,996)


      (7,981)

      Net cash used in investing activities

      (184,205)


      (242,814)


      (562,692)


      (280,763)

      Cash flows from financing activities








      Changes in lease liabilities - finance leases

      —


      (98)


      —


      (384)

      Proceeds from exercise of common stock options

      9,250


      20,851


      25,541


      37,942

      Taxes paid related to net share settlement of equity awards

      (17,134)


      (15,096)


      (32,133)


      (15,096)

      Net cash (used in) provided by financing activities

      (7,884)


      5,657


      (6,592)


      22,462

      Effect of exchange rate changes on cash, cash equivalents, and restricted cash

      (1,049)


      (180)


      (2,923)


      (2,945)

      Net change in cash, cash equivalents, and restricted cash

      (99,752)


      (118,272)


      2,206


      336,204

      Cash, cash equivalents, and restricted cash at beginning of period

      1,243,183


      1,186,188


      1,141,225


      731,712

      Cash, cash equivalents, and restricted cash at end of period

      $  1,143,431


      $  1,067,916


      $  1,143,431


      $  1,067,916









      Supplemental disclosures of other cash flow information:








      Excess tax benefits from employee stock plans

      $         2,094


      $       17,609


      $         5,093


      $       35,060

      Non-GAAP Financial Measures

      In Veeva's public disclosures, Veeva has provided non-GAAP measures, which it defines as financial information that has not been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. In addition to its GAAP measures, Veeva uses these non-GAAP financial measures internally for budgeting and resource allocation purposes and in analyzing its financial results. For the reasons set forth below, Veeva believes that excluding the following items provides information that is helpful in understanding its operating results, evaluating its future prospects, comparing its financial results across accounting periods, and comparing its financial results to its peers, many of which provide similar non-GAAP financial measures.

      • Excess tax benefits. Excess tax benefits from employee stock plans are dependent on previously agreed-upon equity grants to our employees, vesting of those grants, stock price, and exercise behavior of our employees, which can fluctuate from quarter to quarter. Because these fluctuations are not directly related to our business operations, Veeva excludes excess tax benefits for its internal management reporting processes. Veeva management also finds it useful to exclude excess tax benefits when assessing the level of cash provided by operating activities. Given the nature of the excess tax benefits, Veeva believes excluding it allows investors to make meaningful comparisons between our operating cash flows from quarter to quarter and those of other companies.


      • Impact of tax legislation. Veeva excludes the direct cash payments associated with the newly effective tax legislation requiring the capitalization of certain research and development expenses for purposes of calculating non-GAAP operating cash flows. Veeva does not believe the impact resulting from changes in the tax treatment of research and development costs to be indicative of its operating performance, nor does Veeva management consider such impact in assessing the level of cash provided by operating activities. Accordingly, Veeva believes excluding the impact of this change in tax law provides for better evaluation of its current operating performance and comparison to past operating results.


      • Stock-based compensation expenses. Veeva excludes stock-based compensation expenses primarily because they are non-cash expenses that Veeva excludes from its internal management reporting processes. Veeva's management also finds it useful to exclude these expenses when they assess the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods. Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use, Veeva believes excluding stock-based compensation expenses allows investors to make meaningful comparisons between our recurring core business operating results and those of other companies.


      • Amortization of purchased intangibles. Veeva incurs amortization expense for purchased intangible assets in connection with acquisitions of certain businesses and technologies. Amortization of intangible assets is a non-cash expense and is inconsistent in amount and frequency because it is significantly affected by the timing, size of acquisitions and the inherent subjective nature of purchase price allocations. Because these costs have already been incurred and cannot be recovered, and are non-cash expenses, Veeva excludes these expenses for its internal management reporting processes. Veeva's management also finds it useful to exclude these charges when assessing the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods. Investors should note that the use of intangible assets contributed to Veeva's revenues earned during the periods presented and will contribute to Veeva's future period revenues as well.


      • Income tax effects on the difference between GAAP and non-GAAP costs and expenses. The income tax effects that are excluded relate to the imputed tax impact on the difference between GAAP and non-GAAP costs and expenses due to stock-based compensation and purchased intangibles for GAAP and non-GAAP measures.

      There are limitations to using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures provided by other companies. The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by Veeva's management about which items are adjusted to calculate its non-GAAP financial measures. Veeva compensates for these limitations by analyzing current and future results on a GAAP basis as well as a non-GAAP basis and also by providing GAAP measures in its public disclosures.

      Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Veeva encourages its investors and others to review its financial information in its entirety, not to rely on any single financial measure to evaluate its business, and to view its non-GAAP financial measures in conjunction with the most directly comparable GAAP financial measures. A reconciliation of GAAP to the non-GAAP financial measures has been provided in the tables below.

      The following tables reconcile the specific items excluded from GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:

      Reconciliation of Net Cash Provided by Operating Activities (GAAP basis to non-GAAP basis)

      Three months ended
      July 31,


      Six months ended
      July 31,



      2022


      2021


      2022


      2021


      Net cash provided by operating activities

      $ 93,386


      $ 119,065


      574,413


      $ 597,450


      Excess tax benefits from employee stock plans

      (2,094)


      (17,609)


      (5,093)


      (35,060)


      Impact of tax legislation

      37,946


      —


      37,946


      —


      Net cash provided by operating activities on a non-GAAP basis

      $ 129,238


      $ 101,456


      $ 607,266


      $ 562,390


      Net cash used in investing activities

      $ (184,205)


      $ (242,814)


      $ (562,692)


      $ (280,763)


      Net cash (used in) provided by financing activities

      $  (7,884)


      $ 5,657


      $ (6,592)


      $ 22,462











      Reconciliation of Financial Measures (GAAP basis to non-GAAP basis)

      Three months ended
      July 31,


      Six months ended
      July 31,



      2022


      2021


      2022


      2021


      Cost of subscription services revenues on a GAAP basis

      $ 64,035


      $ 53,909


      $ 122,988


      $ 105,126


      Stock-based compensation expense

      (1,693)


      (1,316)


      (2,970)


      (2,222)


      Amortization of purchased intangibles

      (1,126)


      (925)


      (2,216)


      (1,821)


      Cost of subscription services revenues on a non-GAAP basis

      $ 61,216


      $ 51,668


      $ 117,802


      $ 101,083











      Gross margin on subscription services revenues on a GAAP basis

      85.1 %


      85.3 %


      85.2 %


      85.1 %


      Stock-based compensation expense

      0.4


      0.4


      0.3


      0.3


      Amortization of purchased intangibles

      0.2


      0.2


      0.3


      0.3


      Gross margin on subscription services revenues on a non-GAAP basis

      85.7 %


      85.9 %


      85.8 %


      85.7 %











      Cost of professional services and other revenues on a GAAP basis

      $ 87,634


      $ 68,188


      $ 168,196


      $ 133,107


      Stock-based compensation expense

      (13,818)


      (9,541)


      (23,808)


      (16,963)


      Amortization of purchased intangibles

      (139)


      (139)


      (273)


      (273)


      Cost of professional services and other revenues on a non-GAAP basis

      $ 73,677


      $ 58,508


      $ 144,115


      $ 115,871











      Gross margin on professional services and other revenues on a GAAP basis

      17.0 %


      23.5 %


      19.2 %


      26.7 %


      Stock-based compensation expense

      13.1


      10.7


      11.4


      9.3


      Amortization of purchased intangibles

      0.1


      0.2


      0.1


      0.2


      Gross margin on professional services and other revenues on a non-GAAP basis

      30.2 %


      34.4 %


      30.7 %


      36.2 %











      Gross profit on a GAAP basis

      $ 382,549


      $ 333,497


      $ 748,136


      $ 650,934


      Stock-based compensation expense

      15,511


      10,857


      26,778


      19,185


      Amortization of purchased intangibles

      1,265


      1,064


      2,489


      2,094


      Gross profit on a non-GAAP basis

      $ 399,325


      $ 345,418


      $ 777,403


      $ 672,213











      Gross margin on total revenues on a GAAP basis

      71.6 %


      73.2 %


      72.0 %


      73.2 %


      Stock-based compensation expense

      2.9


      2.4


      2.6


      2.2


      Amortization of purchased intangibles

      0.2


      0.2


      0.2


      0.2


      Gross margin on total revenues on a non-GAAP basis

      74.7 %


      75.8 %


      74.8 %


      75.6 %











      Research and development expense on a GAAP basis

      $ 134,008


      $ 94,899


      $ 247,483


      $ 178,125


      Stock-based compensation expense

      (38,901)


      (22,315)


      (64,724)


      (39,152)


      Amortization of purchased intangibles

      (29)


      (29)


      (56)


      (56)


      Research and development expense on a non-GAAP basis

      $ 95,078


      $ 72,555


      $ 182,703


      $ 138,917





















      Three months ended
      July 31,


      Six months ended
      July 31,



      2022


      2021


      2022


      2021











      Sales and marketing expense on a GAAP basis

      $ 89,617


      $ 71,789


      $ 165,732


      $ 136,399


      Stock-based compensation expense

      (24,031)


      (15,115)


      (40,924)


      (26,670)


      Amortization of purchased intangibles

      (3,555)


      (3,429)


      (6,995)


      (6,745)


      Sales and marketing expense on a non-GAAP basis

      $ 62,031


      $ 53,245


      $ 117,813


      $ 102,984











      General and administrative expense on a GAAP basis

      $ 57,832


      $ 42,185


      $ 106,157


      $ 83,340


      Stock-based compensation expense

      (17,599)


      (14,098)


      (30,750)


      (25,867)


      Amortization of purchased intangibles

      (57)


      (57)


      (112)


      (112)


      General and administrative expense on a non-GAAP basis

      $ 40,176


      $ 28,030


      $ 75,295


      $ 57,361











      Operating expense on a GAAP basis

      $ 281,457


      $ 208,873


      $ 519,372


      $  397,864


      Stock-based compensation expense

      (80,531)


      (51,528)


      (136,398)


      (91,689)


      Amortization of purchased intangibles

      (3,641)


      (3,515)


      (7,163)


      (6,913)


      Operating expense on a non-GAAP basis

      $ 197,285


      $ 153,830


      $ 375,811


      $ 299,262











      Operating income on a GAAP basis

      $ 101,092


      $ 124,624


      $ 228,764


      $ 253,070


      Stock-based compensation expense

      96,042


      62,385


      163,176


      110,874


      Amortization of purchased intangibles

      4,906


      4,579


      9,652


      9,007


      Operating income on a non-GAAP basis

      $ 202,040


      $ 191,588


      $ 401,592


      $ 372,951











      Operating margin on a GAAP basis

      18.9 %


      27.4 %


      22.0 %


      28.5 %


      Stock-based compensation expense

      18.0


      13.7


      15.7


      12.5


      Amortization of purchased intangibles

      0.9


      1.0


      0.9


      1.0


      Operating margin on a non-GAAP basis

      37.8 %


      42.1 %


      38.6 %


      42.0 %











      Net income on a GAAP basis

      $ 90,601


      $ 108,858


      $ 190,716


      $ 224,425


      Stock-based compensation expense

      96,042


      62,385


      163,176


      110,874


      Amortization of purchased intangibles

      4,906


      4,579


      9,652


      9,007


      Income tax effect on non-GAAP adjustments(7)

      (25,303)


      (23,151)


      (37,512)


      (44,753)


      Net income on a non-GAAP basis

      $ 166,246


      $ 152,671


      $  326,032


      $ 299,553











      Diluted net income per share on a GAAP basis

      $     0.56


      $     0.67


      $     1.17


      $     1.38


      Stock-based compensation expense

      0.59


      0.38


      1.00


      0.68


      Amortization of purchased intangibles

      0.03


      0.03


      0.06


      0.06


      Income tax effect on non-GAAP adjustments(7)

      (0.15)


      (0.14)


      (0.22)


      (0.28)


      Diluted net income per share on a non-GAAP basis

      $     1.03


      $     0.94


      $     2.01


      $     1.84




      (7)   

      For the three and six months July 31, 2022 and 2021, management used an estimated annual effective non-GAAP tax rate of 21.0%.

      SOURCE Veeva Systems

      Modal title

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