Veeva was founded in 2007 to deliver industry-specific business solutions over the cloud. The COVID-19 pandemic has driven migration to its cloud-based software for pharmaceutical and biotech companies. Veeva recently reported results for a strong first quarter that beat estimates.
Veeva’s revenues for Q121 grew 38% to $337.1 million, ahead of the Street’s forecast of $324.3 million. GAAP net income increased 18% to $86.6 million. On an adjusted basis, net income grew 34% to $105.2 million or $0.66 per share, compared to $0.47 a year ago, and ahead of the market’s estimated $0.59.
By segment, revenues from subscription services grew 36% to $270.2 million. Professional services revenues grew 43.3% to $66.8 million.
During the quarter, Veeva added ten new SMB customer logos for the Commercial Cloud CRM product line. Its product Vault Quality Docs is now used by eleven of the Top 20 pharma companies. Within Vault, five of the top seven CROs have now joined the Veeva Vault CDMS partner program. OpenData also had a record number of wins in the quarter.
For the second quarter, Veeva forecast revenues of $339-$341 million with an adjusted EPS of $0.63-$0.64. The market was looking for revenues of $340 million with an EPS of $0.64. Veeva expects to end FY21 with revenues of $1.38-$1.39 billion and an EPS of $2.50-$2.55. The market was looking for revenues of $1.39 billion with an adjusted EPS of $2.54 for the year.
COVID-19 Impact on Veeva
While the life sciences industry remains relatively healthy, certain segments of its target market like cosmetics companies, pre-commercial SMBs, contract research organizations, and medical device companies have been affected. Combined, these represent a small portion of its recurring revenue base and will have a modest impact on the Vault business. Its Commercial Cloud customers are pushing out their advertising spend and canceling in-person speaker events, which has negatively impacted Veeva’s Crossix and Physicians World businesses, respectively.
In response to the COVID-19 situation to help customers move quickly to digital, Veeva is providing CRM Engage Meeting free of charge to enable remote meetings between pharmaceutical reps and the doctors. It has added remote sample request management to Veeva CRM Engage Meeting and remote source monitoring to Veeva Site Vault, its solution for clinical research sites. It has provided a new feature called Telehealth Metrics in the Crossix Data Platform to provide the industry greater understanding and insights into changing patient and physician engagement patterns.
Veeva’s New Products
During the quarter, Veeva continued to upgrade its product offering. In March, Veeva announced Veeva Data Cloud, a new longitudinal patient and prescriber data solution for retail and specialty distribution channels. Initially tailored for commercial use cases such as launch planning, patient segmentation, commercial analytics, AI, territory design, targeting, and incentive compensation, the product is expected to be available in the US in December 2020. It is powered by the Crossix Data Platform it had acquired in 2019.
Veeva Data Cloud’s main rival is IQVIA IMS data offering and it aims to score over IMS by offering software-enabled data collection, connection, and distribution. Veeva has already signed two early adopters for pilots. It plans to expand Data Cloud to more data offerings and countries.
Last month, Veeva announced its first patient-facing application called MyVeeva for managing the clinical trial process. MyVeeva will enable clinical research sites around the world to eliminate paper and deliver a better patient experience. The product is planned for release in Q4 and will be free for clinical research sites.
Veeva has come a long way. Read my interview with its co-founder Peter Gassner for the beginnings of its journey. The market is pleased with Veeva’s performance. Its stock is trading at $202.8 with a market capitalization of $30.35 billion. It had peaked to a record high of $220.91 last week. It hit a 52-week low of $118.11 in March this year.
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