Veeva Systems Inc Class A (NYSE:VEEV) reported stronger-than-expected first-quarter results and lifted its outlook for the remainder of the fiscal year, highlighting continued growth across its software and services businesses as well as increasing traction in artificial intelligence initiatives.
The life sciences software provider posted adjusted earnings per share of $2.24 for the quarter, exceeding analyst expectations of $2.14. Revenue reached $882.9 million, comfortably ahead of the consensus estimate of $857.75 million and representing a 16% increase from $759.0 million recorded in the same period last year.
Management also issued guidance for both the second quarter and fiscal 2027 that came in above Wall Street forecasts. For the second quarter, Veeva expects revenue of between $902 million and $905 million, with the midpoint of $903.5 million exceeding the analyst consensus of $888.4 million.
Adjusted earnings per share for the upcoming quarter are projected at $2.21 to $2.22, ahead of expectations for $2.19. Looking further ahead, the company forecasts fiscal 2027 revenue of between $3.635 billion and $3.645 billion, with the midpoint surpassing the market estimate of $3.6 billion. Adjusted earnings per share guidance of $9.05 also exceeded the consensus forecast of $8.87.
Despite the upbeat results and improved outlook, shares fell around 5% in premarket trading on Thursday as investors focused on the pace of future growth.
Analysts at Stifel noted that the company’s guidance “implies deceleration to +12.5%” during the second half of the year. However, they added that they ultimately expect growth to remain above that level, stating, “However, ultimately we think 13.5%+.”
Subscription services, which account for the majority of Veeva’s revenue base, increased 15% year-on-year to $730.2 million during the quarter. Revenue from professional services and other activities also expanded, rising to $152.8 million from $124.3 million a year earlier.
“Our first quarter results exceeded guidance on all metrics, reflecting another quarter of broad-based growth and profitability,” said Chief Financial Officer Brian Van Wagener. “We’re pleased with the raised fiscal 2027 guidance and energized by the large and growing opportunity ahead.”
Profitability also improved during the quarter. Adjusted operating income rose 13% to $395.4 million, while adjusted net income increased to $371.1 million from $327.8 million in the prior-year period.
The company continued to expand adoption of its Vault CRM platform, adding 27 new customers during the quarter and bringing the number of live users to more than 150 organisations.
Artificial intelligence remains a growing focus for the business. Veeva completed its acquisition of Ostro in March, adding conversational AI capabilities that are now being deployed across more than 50 brands.
Morgan Stanley analysts described the results as “another clean quarter, with broad based upside in software and services.”
“While investors have lumped VEEV in the disrupted bucket, we see potential and will look to gain more conviction in its AI positioning as a potential catalyst,” they added.
The company believes the combination of strong recurring revenue growth, increasing AI adoption and continued customer expansion positions it well for further growth across the global life sciences software market.
More About Veeva Systems
Veeva Systems is a leading provider of cloud-based software, data and business solutions for the global life sciences industry. Its products support pharmaceutical, biotechnology and healthcare companies across functions including research and development, regulatory compliance, commercial operations and customer engagement.
The company’s Vault platform has become a core technology solution for many life sciences organisations, while recent investments in artificial intelligence and conversational technology are designed to enhance productivity, customer engagement and decision-making across the sector. Through a combination of recurring subscription revenue and expanding platform capabilities, Veeva continues to strengthen its position as one of the industry’s leading specialised software providers.