Key financial results
- Veeva reported total revenue of $928 million for the second quarter of fiscal year 2027.
Total revenue in the quarter was $928 million, with non-GAAP operating income of $416 million.
- Non-GAAP operating income for the quarter was $416 million.
Total revenue in the quarter was $928 million, with non-GAAP operating income of $416 million.
- Management noted that the quarterly results exceeded the company's previous guidance.
Q2 was another strong quarter, delivering results ahead of our guidance.
Business segment results
- Commercial: Commercial subscription revenue grew approximately 13% year-over-year, showing broad-based strength across CRM, content, data, and Crossix.
- R&D: The R&D business is currently transitioning from established products like eTMF and CTMS to newer growth areas including EDC, Safety, and LIMS.
- Data Cloud: The Data Cloud segment has 14 customers, with momentum in OpenData, Compass, and Link products.
What's working well for us in Data Cloud is OpenData, so clean reference data.
Capital allocation
- The call did not discuss capital allocation.
Industry trends and dynamics
- Biopharma R&D spending is trending in a positive direction, which is benefiting Veeva.
- Customers are increasingly prioritizing AI and agentic labor to drive efficiency and cost savings.
- There is a shift away from experimentation, with customers preferring to consume AI from incumbent platforms rather than evaluating numerous small vendors.
The customers want to be out of the experimentation fix. They definitely want to be out of that.
Competitive landscape
- Veeva maintains market leadership in CRM and expects to hold over 70% share in the space.
We see Veeva maintaining over 70% share in the CRM space which means we'll continue to execute.
- Management noted that some large customers who selected Salesforce for CRM are experiencing project delays, creating potential win-back opportunities for Veeva in 2027 and 2028.
- The partnership with IQVIA is performing well and is viewed as a significant positive for both companies.
I feel 500% better about our IQVIA relationship now than I did 2 years ago.
Macroeconomic environment
- The life sciences industry remains resilient and continues to execute despite global geopolitical and economic uncertainties.
The life sciences industry has gotten used to, hey, the world is going to have a lot of moving parts. And they're just moving forward.
Growth opportunities and strategies
- Falcon: Falcon represents a new category of agentic labor for Veeva, with high customer interest and a focus on getting the product ready for early adopters.
Falcon is agentic labor. That's something different than we've done before. We've done cloud software, data, consulting. Now we have this fourth thing, agentic labor.
- Aspen: Aspen is a startup project within Veeva focused on horizontal CRM, utilizing a modern tech stack and a simplified pricing model.
Financial guidance and outlook
- The company updated its guidance for fiscal year 2027, factoring in investments for new growth areas.
It's all factored into the guidance that we've updated for FY '27.
- Management did not provide specific numeric guidance figures on the call.
Leadership changes
- Tom Schwenger is leaving Veeva to become the CEO of a services partner.
Tom is going to go on to be a CEO of a services-type partner, and we think that it will be a great partner for us there now.
- Management does not expect this departure to impact the CRM business, as those relationships are enduring and product-based.
That won't Tom's departure won't have effect on our CRM business because that's more of a it's an enduring long-standing thing.
Product strategy
- Falcon: Veeva is focusing on sponsors for Falcon early adoption, though service providers may be a future opportunity.
- Falcon: Pricing for Falcon will likely evolve as the product matures, potentially moving toward enterprise subscription agreements.
It will be lower in the beginning when Falcon is less mature. So if you want a teenage Falcon that cost you x.
- Falcon: Veeva does not expect to rely on further acquisitions for Falcon, as the current product base is sufficient.
I don't think we'll need acquisitions for product anymore.
Q2 FY2027 results
| Metric | Result | Change |
|---|---|---|
| Total Revenue | $928 million | Not stated |
| Non-GAAP Operating Income | $416 million | Not stated |
| Commercial Subscription Growth | 13% | year-over-year |
How management sounded
Balanced (+35 on our -100 to +100 scale). Management expressed high confidence in their product roadmap and market position, citing record CRM results and strong customer interest in new AI-driven offerings. Management sounded more upbeat than on 20% of the 302 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Read the analyst Q&A summary and guidance and outlook for this call.
What to watch before the next call
- Execution of the Veeva Falcon rollout and the transition of early adopters to live status.
- Progress on the two remaining top-20 biopharma CRM commitments expected by the end of the year.
- Development of the Aspen startup and its ability to scale within the market.
Earlier calls
- Q1 FY2027 (Jun 3, 2026), tone Balanced: Veeva Systems reported Q1 FY2027 revenue of $883 million and non-GAAP operating income of $395 million. The company is prioritizing the launch of Falcon, an agentic labor platform, while reporting strong R&D and Quality Cloud growth, an 80% win rate in Vault CRM migrations, and a $10 million contribution from the recent Ostro acquisition.
