Summary
Veeva Systems reported total revenues of $882.9 million for the fiscal 2027 first quarter ended April 30, 2026, up 16.3% from $759.0 million in the prior-year quarter. Subscription revenues were $730.2 million, up 15% from $634.8 million, and professional services and other revenues grew 23%. Subscription made up 83% of total revenues. Management credits expanding use by existing customers and higher prices from the annual inflation adjustment, with growth coming from both R&D and Quality Solutions and Commercial Solutions. About 46% of subscription revenue came from Commercial Solutions and 54% from R&D and Quality Solutions, and the company expects the R&D and Quality side to keep rising as a share of total revenues.
Profit growth trailed the top line in places. Gross profit rose 13.1% to $662.0 million, and gross margin fell to 75.0% from 77.1%, a decline of 2.1 percentage points. Total cost of revenues rose 27%, and professional services gross margin dropped to 20% from 23% as Veeva added delivery headcount. Research and development expense rose 13% and sales and marketing expense rose 13%, while general and administrative expense remained flat. Operating income rose 16.8% to $273.1 million, and operating margin edged up to 30.9% from 30.8%. Net income rose 14.4% to $260.9 million, and diluted EPS was $1.57 versus $1.37. The effective tax rate rose to 24.9% from 23.6%, which the filing attributes to discrete tax deficiencies tied to equity compensation. On a non-GAAP basis, operating income was $395.4 million, up 13% from $349.9 million, and non-GAAP diluted EPS was $2.24 versus $1.97.
Operating cash flow was $1,127.1 million, up 28.5% from $877.2 million a year earlier. Collections on annual subscription billings and the One Big Beautiful Bill Act helped, partly offset by higher expenses. Management cautioned that the first quarter is seasonally the strongest for cash inflows and that operating cash flow should be substantially less in each of the following quarters. Deferred revenue, current portion, rose 18.5% to $1.48 billion from $1.25 billion. Cash, cash equivalents and short-term investments stood at $7.3 billion as of April 30, 2026. Veeva repurchased 1,255,029 shares for about $221 million under a $2 billion authorization approved in January 2026.
Product news centered on Veeva AI. Ostro, acquired in March, is delivering conversational AI for more than 50 brands. Vault AI is on track to reach all Vault applications in August, and Veeva Falcon, which aims to provide agentic labor for clinical, regulatory and safety work, is planned for an early adopter release in November. Veeva added 27 new Vault CRM customers in the quarter and now has more than 150 customers live on that product. The company serves more than 1,500 customers overall. Subscription revenue was split 60% North America, 29% Europe and 11% other locations.
Guidance for the fiscal second quarter ending July 31, 2026 covers total revenues, non-GAAP operating income and non-GAAP diluted net income per share, and Veeva raised its outlook for the full fiscal year ending January 31, 2027 as well. The company does not provide GAAP targets for operating income or earnings per share because excluded items such as stock-based compensation are hard to estimate, and it says the effect of those items may be significant. The full-year outlook applies to the fiscal year ending January 31, 2027, not to the current quarter.
Risks listed in the release include problems with product performance, availability, security or privacy; competitive factors; customer decisions and priorities; life sciences developments such as regulatory, funding or policy changes; macroeconomic and geopolitical events including trade policy shifts, inflation, currency moves, interest rates and conflicts; and the ability to hire, retain and compensate employees. The filing also notes that changes in deferred revenue and billings are not precise indicators of future revenues, partly because renewal dates and billing frequencies can move between periods.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2027 | Q4 FY2026 | QoQ | Q1 FY2026 | YoY |
|---|---|---|---|---|---|
| Revenue | $882.9M | $836.0M | +5.6% | $759.0M | +16.3% |
| Gross profit | $662.0M | $622.5M | +6.4% | $585.2M | +13.1% |
| Gross margin | 75.0% | 74.5% | +0.5 pp | 77.1% | -2.1 pp |
| Research & development | $208.3M | $198.8M | +4.8% | $184.0M | +13.2% |
| Sales & marketing | $111.1M | $110.2M | +0.9% | $98.6M | +12.7% |
| General & administrative | $69.5M | $67.6M | +2.7% | $68.8M | +0.9% |
| Total operating expenses | $388.9M | $376.6M | +3.3% | $351.5M | +10.6% |
| Operating income (loss) | $273.1M | $245.9M | +11.1% | $233.7M | +16.8% |
| Operating margin | 30.9% | 29.4% | +1.5 pp | 30.8% | +0.1 pp |
| Net income (loss) | $260.9M | $244.2M | +6.9% | $228.2M | +14.4% |
| Net margin | 29.6% | 29.2% | +0.3 pp | 30.1% | -0.5 pp |
| Diluted EPS | $1.57 | $1.46 | +$0.11 | $1.37 | +$0.20 |
Risks
Salesforce has announced that certain large Veeva CRM customers have committed to purchasing its CRM solutions, and a number of our customers have informed us of their intent to move to Salesforce as their CRM provider. This risk is heightened as we transition customers from legacy Veeva CRM to Vault CRM.
Our agreement with Salesforce expired on September 1, 2025, and during the wind-down period to September 1, 2030, we may not sell applications utilizing the Salesforce platform to new customers and sales to existing customers are capped at 150% of seats in use as of September 1, 2025. If the Salesforce platform becomes unavailable earlier than anticipated, our business and operations would be adversely affected.
Nearly all of our revenues are generated by sales to customers in the life sciences industry, and factors that adversely affect this industry, including regulatory changes such as drug pricing reforms and healthcare funding reductions, or industry consolidation, could reduce demand for our solutions.
Uncertain macroeconomic and geopolitical factors, including changes in trade policies and tariffs, worldwide inflationary pressures, currency exchange fluctuations, changes in interest rates, and geopolitical conflicts like the conflict in the Middle East, may cause instability in the global economy and negatively impact our business, financial results, and stock price.
Incorporating AI into our solutions (Veeva AI) presents new risks including reputational harm, regulatory scrutiny (e.g., EU AI Act), and legal liability if AI offerings are perceived as inaccurate, biased, or harmful, which could affect adoption and require significant changes to our AI strategy.
Increasingly complex data privacy regulations, including the EU Data Act which allows our EU customers to cancel subscriptions without cause after September 12, 2025, impose compliance costs and may reduce demand for our solutions or subject us to significant liabilities.
Total gross margin decreased to 75% for the three months ended April 30, 2026 from 77% in the prior-year quarter, driven by a decline in professional services gross margin to 20% from 23% due to headcount expansion, and professional services gross margin may not increase and could continue to be volatile.
We acquired Rise Healthcare Tech, Inc. (Ostro) during the quarter, and acquisitions could divert management attention, result in additional dilution, and disrupt operations. We have limited experience in acquiring businesses.
Our share repurchase program may not enhance long-term shareholder value, and repurchases reduce cash available for other purposes. In January 2026, our board authorized a program of up to $2 billion, and we repurchased 1,255,029 shares for approximately $221 million during the quarter ended April 30, 2026.
SaaS KPIs
All quarters →Total Customers
Non-GAAP Operating Margin
Non-GAAP Operating Income
Non-GAAP Gross Margin
Vault CRM Customers Live
Non-GAAP Subscription Gross Margin
Summary, forecast, risks and KPIs are extracted from VEEVA SYSTEMS INC's SEC filings for Q1 FY2027 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 6, 2026.