VEEV - Earnings call transcript Q2 2019

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Operator

Good afternoon. My name is Chris and I will be your conference operator today. At this time, I would like to welcome everyone to the Veeva Systems Fiscal 2019 Second Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator may conference. you begin Lund, the Rick

Rick Lund

Gassner, Good quarter ended earnings welcome President; to and are July Wallach, our Officer; XXXX second Veeva’s fiscal Peter call call today’s Financial XXXX. Tim me afternoon, Chief our With Executive Matt and XX, on our Chief for Officer. Cabral, the quarter

forward-looking is based the of this performance forward-looking management’s our differ materially. website at on trends, under release regarding the and course in earnings are conference factors sec.gov. anticipated make expectations be Actual the the Please During our veeva.com included on and Investors subject risks strategies at the may to which of refer our website statements most current views These to listed business. on the statements on and call, available in we the will results filing and and SEC’s risk will risks uncertainties. various company’s and recent section the XX-Q, Form

during made being contain Veeva call today XX, viewed the are statements or presented not obligation the information. any Forward-looking or update current forward-looking to any statements. of call after this accurate replayed or during may XXXX. is the disclaims made August revise information If as today, call

but We do we so guidance call, provide our will guidance any the on forum. quarter unless in will further performance provide not today’s or public during updates on a

the which filed found on comparable metrics today’s SEC certain before X-K website can we is release, financial metrics the discuss On aid we exhibit as A of this an our non-GAAP that the results. GAAP also the available in to and to will call, form be earnings with just our call. understanding believe reconciliation in

welcome on X Finally, you Analyst Investor at New and join Day Annual in York. October to I’d us our to like

please at to to If address ir@veeva.com. invite to would feel e-mail via yet the attend, you received an me like and out free haven’t reach

And thank event us. the I archived person, for join that, with our the can’t will If website. Peter. you both will over live and on joining be you to available Relations versions with in it webcast turn And Investor

Peter Gassner

and was growth above and was with growth for Total the million, thanks It guidance. had profit by of today. revenue us quarter XX%. results made and life quarter time, At Subscription markets. margin same the another like products XX% we new to up strides future Safety, with Rick, you, seeds great Vault excellent quarter strong our was revenue Thank in for joining year-over-year. Nitro and outside In execution non-GAAP markets XX% growth disciplined was the everyone operating fueled $XXX for EDC, planting of another multiple we in QX, sciences.

smartphones. the I’ll we On is Commercial provides significant Turning UI multi-device the refresh a laptops, user start intuitive tablets made introduction a our XX, in to interface CRM this Sunrise most specific adaptive, interface consistent major quarter, items August experience few CRM with and Sunrise. the iPad Veeva product, XXXX. design an have in Cloud. and of in our Sunrise is and advancement of CRM across highlights we for since call a released we

over smooth So to by our for iPad Sunrise. Sunrise this of and our and the majority received on weeks outstanding are was in feedback it released for users them. transition year already off ago, a a from just CRM was making. CRM innovation. The Hats move team two using them we’ve was the great customers bold

effective. more This world We’re ensure efficient right get and reps around ultimately the medicines the helps patients. to the pharma making right

extend in to leadership continue our market We CRM.

of expansion out. was that with years than deployment. roll the and CRM a the U.S. ago, top global a Veeva two had CRM pharma For less success Veeva XX for example, this select in They started based we upon

CRM Our of progress the added SMB continues year. the in SMB well. first-half as in new in XX customers We

Cloud Align products of CRM expanding use their Veeva adding by Events steadily other Veeva and Management, also on customers OpenData. such a are Our Commercial as regional Veeva basis

customer take which the built May. transform more major sciences. in Nitro, high Nitro level fully of been life early we our verbally a announced power adopter to encouraged commercial data have signed the eliminate a customers committed. life We’ve also our by a progress is could interest next-generation real be so for breakthrough minute We far. It sets on of real been specifically me that in to system and Let AI. potential believe a has leverage burden engagement Veeva warehouse already custom customer’s and up sciences. We Nitro first customer our and another the Nitro few in for has Nitro industry. a

will We it revenue. in to Nitro and Way Veeva to out take time roll the significant any will ramp

be on will outstanding on the success adopter product. focus Our early customers an creating of our and

and initial opportunity. execution demand. Overall, our the serve market progress our I’m Commercial and happy with very to Cloud we’re in pursuing and innovation with market our We’re expand the better pleased customers

on number acquisition customers has side across success leadership multiple customers with another Vault are added a excellent regions. bringing proven Since commercial of our and the Zinc migrations ago, we on Veeva be have Vault, the significantly the position had we’re nearly love PromoMats We to years product. to track content. to acquired industry. PromoMats for great in Turning the Vault. and three we strengthened quarter. innovations commercial a customer Zinc Zinc record

quality a customers. unified Also, quarter, doing part significant had in is with a training They make cloud efficiency Having is pharma XX how into and highlight systems and recognized will of XXXX. in was a from of quality, the unique regulatory breadth for in cloud-based our proposition traction a a value number one in side Development R&D It lot announcement legacy well. It’s will in and platform. our is area. top of remarkable as flexible big first Veeva need XX indicates we for XX top Vault We resonating development is highly their applications alternative depth our more I’d We offering, unified as quality leader. quarter using compliance. difference market for cloud system be the quality a provides. On win fully only who coming with XX clinical Vault in the there eTMF, systems. the the in a In that widely market. Vault, an with safety have have delivered are XXX modern had pharmas area. the of This on cloud QualityDocs the struggle great Its customers. to new have clinical, within a examples a of and the area, and at in Training, in want as increasing one exciting wins least to now than that’s now Training continues Vault of the area They interest in we’re pharma. modern, quality this like existing solution the development cloud of differentiated cloud seeing. division. eTMF becoming clinical, top we including quality customers training customers of progress QualityDocs a Vault in late one very the fragmented There’s integrated In quality Europe. and

quite ramping products Our newer well. clinical also are

pipeline early we EDC of XX of and a Vault their study CTMS from word gets XX We with the enterprise-class as success for an Vault Veeva the tightly around. going one Only growing for also customers, including CTMS customers pharma, customers and has on Customers XX evaluating that integrated CTMS beginning top and well. Veeva had same quarter quarter-end, others. is with finished who platform. this. As with want is eTMF our first EDC is

we’re becoming a customer and success, long-term approach outside sciences. platform on our life long-term through to EDC leader play. We’re a quickly also you in application innovation Vault. want the efforts large Veeva making with good It’s the I committed update unified progress. Vault of on EDC is based and to

a life customer. have highlight based the early success add seven-figure with projects. we our customers was and adopters. is outside one few that, now early with existing to initial with of new This expansion result our adopters continue of first sciences of expand The the of quarter on We

adopter leveraging to area outstanding for progress. making for outside well will industries the great sciences. work clear and I’m of very Veeva model again team. selling sometime, summary, is delivered we’re the be still of the Together, phase we new going Vault Veeva quarter. In life that within Platform early proud of reference this We’re once and It’s but in our using an

a becoming and innovation, on to I’ll financial to our We over can turn the review the of continuing become over to confident multi-billion With our areas are company most life customer innovative Tim we industry in of I’m the vision that, realizing products time. the By focus it in strategic delivering to results by disciplined success, dollar greatest impact. most goal more partner detail. to achieve our execution sciences

Tim Cabral

steady in areas revenue the solid XX% in Strong year items. in XX% ago. million, of incremental saw in R&D. more from including one-time up year. bookings of revenue growth Thanks, momentum continued some $XXX across a performance to $XXX XX% another in the these one catch-up than QX from in with Services year from expected represented I $XXX expectations, million, we was amounted our Peter. quarter ahead in quarter. was similar to up a also year. quarter deals revenue from XX% Cloud. our last and which expect Vault This million In within total XX% $XX subscription little a Subscription was primarily Vault, revenue Total revenue, from up QX, QX. from up to close year million Commercial Veeva earlier XX% that came one million almost revenue in ago, initially closed million of a business $X came execution. along increased of anticipated, last driven revenue demand $XXX QX increase. QX result services to in ago, Vault XX% continued of by some of all than $XX benefited strong Together, in of million at subscription

the a infrastructure XXX from tax roughly benefits quarter in operating line, outperformance which of a over million, the a at our on people of above at driven a record the including one-time computing ago. true-up. was and X,XXX, $XX factors, hiring of top by quarter, one closure net an company, X,XXX the we of $X non-GAAP Across operating This had income of our mix tax efficient and the guide. XX%, and or audit from spend, Our finishing more came property million was margin in year high-end up payroll adding

was for in for of ahead make quarterly of the to guidance Calculated better in plan Please highly reflected indicator which hiring factors aggressive internally. metric this discuss driven expected the of do back-half an the which have momentum billings on $XXX the quarter business was I’ll of than were Therefore, by This a we remember is bookings. moment. manage there our the guidance not don’t outperformance year, million. we our basis. We revenue in million, $XXX of a that several believe good underlying of year-over-year and comparisons it’s the variable that and a are it services

guidance year and of the Our billings best are indicators the subscription momentum. calculated guidance our fiscal revenue full for

last of renewal which of Looking as a the to in QX prior This $XX ahead, the date. million. reflects $XXX was their impact $XXX realigning referenced expect guide our full-year, which million million up with an just exited roughly customer million, billings million from large I incremental is calculated Note due and cash $XXX QX $X to of cash and in our from We short-term we by billion end investments, still equity quarter, for $XX at over about than about of flow from the driven million, benefited million benefit compensation. from due cash line This up QX QX. results collections to a was in quarter. strong tax operations better expected related almost bottom of million performance excess and to increase $X $XXX in primarily $XXX that

now least million, cash this expect excess to operations tax full-year, the we benefit. excluding at be from For $XXX

next for of outlook our and the sharing the rest by up quarter wrap me Let year.

$X.XX, between third we to a $XXX the based approximately count million $XXX and million. on million; $XXX $XX expect share operating For non-GAAP revenue of of of $XX net diluted and non-GAAP income share fully income quarter, million million; per

subscription our range million We revenue $XXX we revenue million in increase year, to expect to of for expect full-year. least the from million $XXX of $XXX be $XXX at the an For the $XXX million, previous guidance million. to now now

to We continue exceed Vault we XX%. of Commercial to growth subscription last growth expect over about Cloud year, revenue now revenue XX% subscription expect and

of both income and our million XX%. million to and keep to For This almost margin targets non-GAAP year anticipate exceeded $XXX in previous a guidance margin this $XXX due of has to to margin $XXX in XXXX, dollars we $XXX thing now the operating revenue of fiscal of from an a XX%. almost is million, margin One our increase million, mind, outperformance.

We numerous continue our invest growth early-stage and in hire aggressively to initiatives.

net approximately pleased capitalize excellence exceptional are fully per to we’re across the $XXX We and joining market on to today. and call success positions $X.XX based to us opportunity turn product of on focus the on back team’s operator of on results non-GAAP income Thank The and the it expanding ahead. now questions. for large you And continues strong seeing and the targeting us drive between well for a company. count the with execution diluted share Overall, $X.XX, we’re million. share customer I’ll

Operator

Suri Instructions] [Operator William comes with Bhavan first Blair. from Our question

is line open. Your

Bhavan Suri

guys, but I sort little significant, especially the margin think how And are Well, you quick my congratulations product. done. just of thinking guys for wanted a Training What’s fairly TAM? – I to Hey, about taking how And guys market case. how number. board, Vault importantly, the understand you thanks but think and love use well here? to I It we bit across the touch on and then addressable about that a then just of understand guess, sizing that to that? about sort love have I’d so follow-up. more or call seems

Matt Wallach

Sure, Matt. Bhavan, it’s

required Vault for it of one to basically So context, is Training customers. something our every in put

And so Quality the more to part whole complete, having more Suit the thing strategic, really outstanding. has announcement response of that Vault the makes and as the been

market. $XXX In terms of about million it’s the size of the market,

together. Quality In gotten addition opportunity, have to to QMS for which translates QualityDocs XX% and Vault Suit we Vault about what would more the than

very we’re that use within manufacturing there’s it So requirements. for setting, life is of mostly what case the size expands doing working very, And the and compliance sciences. quality are people in high

by And as a so be compliant used a And corporate a for same they LMS large corporate train these token, the quality wouldn’t to certainly very this manufacturing generally not employees. customer. use LMS, wouldn’t big enterprise

generic time the LMS we co-existing will up end the over So with at enterprise customers.

Bhavan Suri

important life as Because see you helpful. Then see how side, past AI, I sciences. an development Super Safety engine training how see the in of the sort EDC how to guess, EDC, on it you. of X question stuff, the prioritizing clinical versus you playing that, the it. is about versus sort Got R&D? prioritization Nitro just think should is, in AI of could developing talked and just Phase you the about that about Thank sort in AI engine place. But versus of you the specific Training of more playing? are we now do versus you the AI

Peter Gassner

Yes. This is Peter.

across One multiple really of execute well Veeva the is large things does markets.

multiple markets. So development across we it can We a of any the view execute type don’t trade-off. as

we’re that’s with So we’re training, what AI. doing when or separate something doing on on CRM

not Nitro, only and on Nitro to our important of what products for very our data all but it That’s the commercial understand, is sciences. those things. fed make is AI to the put as layer we’ll build That’s But side commercial to AI for types will because can layer. operational specifically and products foundation a sure data as relates it product very a life that that’s be we in foundation reporting, on warehouse also products analytics AI, data standardize Now of AI well. from the accessible other

pretty in the top then on that way AI to is Nitro of products. methodical base clear it’s come the about the do And will that. we’re us and So we very

Bhavan Suri

guys. helpful it. congrats. was That and Thanks. Got Thanks,

Peter Gassner

Thank you.

Tim Cabral

Thanks, Bhavan.

Operator

Materne question Your with next Evercore from comes ISI. Kirk

line open. Your is

Daniel Greenfield

Daniel Hi, guys, this Kirk. questions. is Greenfield for on two Got

product product is, mentioned it talk comment the moving you’re how is, pretty quarter seven-figure And what in adopter a million because still one beat it’s this in being feels QualityOne in deal to can full-year follow-up relative you the the I you you that moving raised on is I first because about guys had your $X you like of high But then sciences. seeing know mode? And considering pretty just expansion guess, above my The your forward. for that for expectations, early we’re phase. revenue life outside harvester fast pull you could just pipeline,

So I guess, gives you pipeline are in what seeing that? you Thanks. that in the confidence

Peter Gassner

going we Okay. well And there expected. as things QualityOne it are sciences, as the relates outside of life and to

the small in that off small mode. a where they I is full make deal. company. can with had ago, time deal. [Technical project. Vault They give liked to on It’s of This and early you So seven-figure they we’re started Difficulty] we a still platform. some us product, quite people, audit adopter improved color as That success our some our that liked an CPG

functionality So they last very they our looking really been alternative. And liked a a cloud against for made the also broader roll of a competitive in modern team on-premise progress is saw then They making up that process have legacy product. requirements. years. our a provider we’ve they and is this out mature these a really over XX But system, compliance quality that the type when they’re needed

QualityOne so choice. as their they Veeva chose And best Vault

enter be want a excited that’s get who that. customers to for attractive couldn’t it’s to rid do about platform, And what legacy. and provide our Vault more want alternative that market, real of cloud and we when So we innovative a we on

Tim Cabral

take Daniel, pipeline the I’ll question. And

component this about there’s is subscription raise think that revenue the on two side. that. obviously as the So the quarter, One we and in full-year of guide

the raise And in in that us considers the in the second-half strong beat multiple the that we QX we’ve So we’re pipeline across a performance markets also in call, commented demand well serving the saw of subscription and Veeva large as especially the R&D the call confidence for Vault’s area of we’re raise. that really as services gives this in both bookings seeing, services quarter and this all on first-half part year. of the the that the

Daniel Greenfield

helpful. That’s you. Thank

Operator

from with Your Canaccord. next David Hynes comes question

Your line is open.

David Hynes

Hey, thanks, milestone. about guys. the pretty want EDC a I seems that to win, important XX ask like top

reevaluation? the long there’s lines starting those run along potential Who I talk replacing scope how but you there? So you they’re additional color. curious can here? just said What’s mean, about from will helpful? a to you be know the have Anything with trial, one that are deal? the of I does What’s process before

Peter Gassner

Okay, great quarter. win great. Yes, that was that have to this

small small Of but course, the perspective, –very a significant. deal very from revenue

Let me high start off level. a with

If enterprise you that the been really in has look not the players over years, the area. past EDC XX, and two coming XX, XX market too consistently service that fast there innovation been

this So customer very felt important what was basically. satisfied they friction much quite just with weren’t today. not process they are weren’t like satisfied and was this They modern. clinical they in have they There not particular current, too

is the customer has this what trial alternative Vault area. and with with saw other commercial and the a promise Now areas wanted And they the satisfied other Veeva the therefore, working they’re is and great regulatory they’re and Vault with clinical a starting that and they quite EDC. see us. in like, And products to in

select goal way goes innovation so to away when and to a been predict want long to this time, certainly out of really that’s EDC hope I yes, certainly bring for Now for They’ll I I market – deal more wouldn’t a significant that’s But will just things our those from could crying innovation. that that, can’t well. But enterprise happen. we’re over happen. trials very maybe trial us

David Hynes

side. you Vault. have the guys today terms update? that Vault okay. can’t something some we PromoMats think mean, penetration maybe matured of of with most I’m the stand I give and your over curious in CRM obviously, can probably remember in could attach share or switching us – the where But you Is base? And us talked then it’s penetration, about is I you Yes, commercial if past. I

Tim Cabral

question. question. don’t a you I with your talking if and DJ. started We trick penetration know PromoMats and Vault CRM to trying asked me about you’re then

David Hynes

Vault to CRM CRM terms in buying was there of seats. more So is in? Where commercial, words, right, In we so Vault much runway asking, I how for are PromoMats just your Commercial? other attaches of customers a

Tim Cabral

I I sorry, got All it. misunderstood question. right. I’m your

front not PromoMats I And something it actually of so get CRM it’s that I me. specifically, penetration Vault of within don’t track I it, have in

I’ll answer to So have generally.

XX the use use also don’t top pharma ones PromoMats. them of the majority the do companies working Zinc to with The that and So we’re migration.

as leader – the clearly So mean, market. that we in of – we’re think I market

licensing We migrating XX more companies Zinc over functionality the biggest asset and PromoMats customer. by product the will innovation where top with of larger deals product, Vault digital leads customers of DAM digital is lately outside management, particularly within grow PromoMats that of a new to from with kind which the asset innovation new winning have, a around management, we number potentially every by users

what business. they we’re products really So exactly when acquisition. when content made there’s still that these that that started level what pleased that we we growth management the level of And hoping we global of value within the about is satisfaction, product, get are customer that is from

very And business is that good shape. so in

David Hynes

Yes.

that’s Okay, of guys. lot, numbers. Thanks Nice perfect. set a

Peter Gassner

Thank you.

Tim Cabral

DJ. Thanks,

Operator

Stan next Zlotsky comes the Your from with Morgan Stanley. question

Your line is open.

Stan Zlotsky

moving Thank that as forward? keep one-time a in And maybe FX we win? through the in But for questions, maybe afternoon, in the is apologize one or billings bit displacing, you essentially, us I’ve high good my you. and you level. current number need just mind to taking it there early guys, we got adopter. about a noise. much one guys Tim. for so walk Nitro little any results, product question. What for anything quick any? the as background and well win solution quick thank I think And two the The that for Hey, then early had that The as if quarter

Peter Gassner

Hadoop-based going might that’s that Generally, take database the to overall, Nitro. Nitro a replacing solution But technology. on. be custom-build, a be is – technology we’ll on a relational of custom-build built technology, go what’s on variety base or built a I’ll we’re with replacing Okay, one a on

an with early warehouse. Now case of commercial really a particular company their solution. a stretch call win had commercial this was smaller that’s this this in is quite a to unsatisfactory on even they It and in adopter, it data early the cycle

considering can There they Veeva that system. and didn’t from hey, on. replace they just we just We a something. we building thought why turn them replaced to early So one guess, they the a were were got of we better I one no they really really to anything. get adopter, rather than purchase that’s, And can ours something, that’s as get about very because lack having replacing to justify

Stan Zlotsky

it. Got

Tim Cabral

billings number, in revenue on services as about by Stan, of Most was this a beat my had, $X heard the you the driven beat, that we prepared remarks, and quarter. million we have some items bookings we a specifically. and necessarily very FX. FX than performance one-time mentioned there better large exposure expected. you But had is no to don’t We did see

for – So year. immaterial is it’s us there, there it’s fairly for a the but number

Stan Zlotsky

much. you Thank great. so Okay,

Peter Gassner

welcome. You’re

Operator

Roderick comes question next from Stifel. with Tom Your

open. is line Your

Tom Roderick

wanted some gentlemen, about the big little So, of at a the to bit in next DJ’s and of of products. a you X to or you’re ground deal just Phase EDC actually Phase for trials know Phase proving sort know little thanks afternoon you later-stage for kind bit of customers talk I leap if X was you of on how into shed you major could X and making X and larger just and kind Where Could hoping into, talk using for that interested that piggyback want they’re trials. versus is and customers looking are question EDC trials? on Phase about respect and this X the light with good general. question. in a my taking at I just don’t I earlier from

Peter Gassner

Yes, that’s a question. great

We’re EDC, our in with we’re where now limiting ourselves the by stage no phase. longer

were was where Phase different six, that X ago. X. Phase we at were We months and than looking specifically nine Now

we’re phase. Now not by limiting

do we’ll it’s at specifics which we look We trial far that and not that’s individual there the is the protocol, might tell more to the features us. the few still customer, fit But can between. be a some see will and good of very for getting hey,

a the to trials. multiple be starting the We’re of fit for good

So not But not product mature the is we been product could have and familiar are yet while as for are a there no with our limited as there. it. out customers the longer

So pilots risk And adverse a and area, like naturally, but going in that’s do some be they great course, things have question. they’re to this a little to of that. then,

We’re by trial. no the longer phase of limited the

Tom Roderick

update Good Fantastic. on that.

other decision adoption I one, seems all has like things that more ties maybe together, eTMF paired The we were sort it given think long about that inhibited, CTMS of the know they of very because come at it and to way time. sort roughly and a being released than deployments of makers you’re that revenue same material is these sort of less the naturally more XX being you Should months EDC? driver we Vault that? to sales next, successful and R&D the What talk XX of CTMS? seeing the say, as of from the think the a Can have. attached that cycles you about about sort of natural to in selling motion

Peter Gassner

the cycles so you so not are about Okay. different The and RFPs Yes, all awfully far. specifically of is indicative of integration Vault, CTMS sales so that in this case value the CTMS between we’re Tom, as heard and excited the eTMF.

we to sense. sold sort just eTMF end we and of it to – competitive. selling same people It’s not always Now that the it’s up very an often makes

the that lot But word eTMF, no-brainer. platform along in tell same I hear data if the I do And no-brainer, that and some you use you CTMS. don’t like together have documents anything certainly all you a work a the people a to the the They in market that customer we is manage the together. get ever just

ELAs. your escalating the was In be revenue about terms to stream right. probably big talking seven-figure we’re XX about of deals, XX looks months, timeline I to going think, what like,

success ourselves We’re the based those into now of the on early adopters. certainly putting cycles sales

you so I excitement again, what it that And lack timing remember really calls think for. was me think we on think point fun right of or and of we in back had I your made of hoped that yes, sort excited four a right. about my level And made is for five CTMS, guys I what innovation of actually exactly from ago, for is expected. to I just indicative, I about And a the product space was it’s of years. many Peter many,

so that And industry. to able we’re for the solve

Tom Roderick

this. update guys. Great you, Outstanding. Thank about

Operator

Wong Ken Your next Partners. question comes from the Guggenheim with

Your line open. is

Ato Garrett

Hi, This on Ken Ato Wong. good for is afternoon. Garrett

customer. spoke Just your Nitro. and timing you particularly some of question large innovations product another earlier know to I relating about new one a landing

data seeing Just adoption but or if some type you product? timeline give in revenue. for something timeline for that’s little whether thinking just to out, rates turn little two-year color further you’re that’s one-year you can thinking really a the up about about of know more that mentioned kind bit I start on

Peter Gassner

the customer. or to was regards not small for to that’s early there adopter Nitro large a As be customer a customer early adopter the very, clear Nitro early very that

not So something very significant revenue perspective. it’s from a

Now Nitro May. of the is available won’t we be a It very end it announced generally until year. towards early in products

for revenue was five in roughly uptake. product of take five years significant things terms put eTMF fast years revenue and and three, from would significant In fast To years generate we’re to we now generating that ramp might perspective consider first eTMF significant introduced ago two, these these our that take a revenue.

we’ve and So the also even the in that’s we’ve we excited in future brought so for which but had produce the results that Nitro, had safety growth of plant seeds I’m that’s care what can these haven’t way out. EDC, this it take quarter, customers we why takes

out. in So are pay years these going things three, four, five, revenue to up six

Ato Garrett

Great. Thank you.

Operator

with Jaluria Your next question comes Davidson. Rishi D.A. from

Your line is open.

Rishi Jaluria

expansion. momentum for continued to side. the and EDC margin taking Nice wanted to guys, I start some on Hey, see question. thanks my

still expand adopters early seen signed GA You’ve you some with the year? And early when that on And success eSource customers. Is to and I from up end of eSource the indications early good seen have follow-up. to released? then by the it’s any customers interest of EDC track you’ve have a

Peter Gassner

a EDC, of we’re that’s part to And area. bring relates learning that process. that just it to As going the lot of in there’s natural innovation

learning things want we What the every I finding that priority literally now, for a is it’s work adopters – think. do of something and really, operational more the We it’s sponsor between early But them. around data, that on. core the to we’re have the EDC. week, reporting the data the capture, have are exchange not the they and It’s something medical CRO. The we in the with like and is, EDC boy, coding, dozen data them the

we when basics. on got realize Honestly, I into eSource. market, market didn’t think the hurting about bad more first think we the we talked the EDC was how I

customer so we’re get adaptive. And we – We adopters. early very

have we then early And but basics. mindset, man, need basics. learn from a really modernize to we learned adopters. the have those need is, what they their We to They

will but So likely put for next not would It it’s that’s this the something hold we and I now. the year. think not come, on year coming eSource

Rishi Jaluria

feedback if OLS from Thanks. That’s Okay, with And wondering there’s been takeaways helpful. early thoughts adopters you out got it. any any of your help you of Quality think efforts or this QualityOne Vault then side, your in share coming was earlier shape that some And the might product I general? Summit pipeline year. the the on could if

Peter Gassner

was sort It that our that in it market. so first – was giving our was Yes. party so summit, QualityOne first of

was collaborative. Veeva? for early and thing with you and market. getting about do And customer to asking, small you just I normal are think And So with you was And going? set it think People doing in And are area. do we’re the how it in hey, are that Veeva? And Veeva? good what doing there the where think what sharing then you the ideas. it’s information it’s help future And patterns was summits

it’s developing are selling. and getting reference early enthusiasm So we

a RFP the that similar deal closed us, quickly. to month, Veeva, customer. very we not a last came in with it was was – in QualityOne because small that this And customer. success they Just having process, of it that for came therefore, heard is another and we’re And last they the large working

also And just should get Veeva. reference to good experience. works, the do with are maybe has We like the lot with customer that’s a a product has selling, we that really customer, this to but do which

Rishi Jaluria

Thank you.

Operator

Brad question of next Lynch. Your comes with Merrill Bank Sills America from

Your line open. is

Brad Sills

some some perhaps to seeing sciences these far? on the perhaps previous guys, trend, new with of with taking Maybe that on where a the you’re you’ve or in just verticals there outside Thanks, Oh, so question. commonalities a question any Are use great. wins follow for life verticals QualityOne. cases seen, my

Peter Gassner

most The that extends like agrochemicals. Yes. chemicals. things we’re also are but And like and cosmetics. to two you would you having expect, are the CPG verticals something that success where expect, things Chemicals is CPG things it’s but would also

two success in seeing seeing and U.S. the some are those Europe success we’re we’re and markets, broadly, big the well. as in So

Brad Sills

may Thanks, Peter. if then And more Great. I please. one

sounds of commercial within where CRM seats Is an Thank here in we still the on one terms base? drivers core Just opportunity? from still installed like the expansion in opportunity, that are side. remind of Can that’s us of the you of expansion it incremental growth the you.

Matt Wallach

Sure. it’s Matt. Yes,

are around XX% product, of of of have in XX%. line SFA a So the terms above in we terms And where core we’re kind sights penetration. we bit of

So on these of I the that’s of offer across this other coming the calls. across globe industry, customers range gained on it the the wide big of we’ve wouldn’t be parts. strategic and surprised if to us we’re And up – trust allows XX% assets, at then one because

the installed customers and customer on that hasn’t very just add-on management rapidly, of is of grown Events of approaching base and I’ll of XX%. but approved a percentage the before, XX% is very, XX% products reviewed both basis on above users as calls that are number email expanding our even is kind usage Align Engage much. about continue these above if and the still CLM through So of number is so XX%, the still, we’ve

of probably have largest products of is of all all size we good them, incremental then those So progress them the Nitro. of of the roughly on and combined all add-on

be largest we after out the really And the get phase. will Nitro once moving, so the adopter early of engine growth commercial of driver starts cloud

still couple add-on and three, two, then next the probably of couple will add a to become growth is five cloud. products and commercial for the engine years, of years more four, more So Nitro users in there years as explained, Peter

Brad Sills

thanks Great, Matt.

Operator

Sterling Auty comes question next JPMorgan. with Your from

Your line open. is

Ugam Kamat

Hey on guys, this Sterling. Ugam for actually is Kamat

you within follow-on how follow-on the really particular -- customers, just see initial So have existing an or seen the EDC purchase? are to orders and any on just they from to within indication product, expansion expanding product of their their CTMS

Peter Gassner

patterns size could do and Yes, that, medium of we have common certainly one we is, see it customer. with small the be so the our customer eTMF in to

and a they it, two our have that’s common pattern. now with do they ago Now we happy adding they are they’re CTMS, so a eTMF, we are our and years didn’t CTMS have adding, so product very

as especially As that it is will far EDC trial the they now in by trial a as basis, EDC, buy mode. adopter it and little different is right on early a

that consider Veeva the company they as them an with want but Veeva add-on certainly that wouldn’t with that experience to and as I good influences So a have Vault try EDC. a to things on product, platform

Ugam Kamat

forward the to Got you, cloud developmental of that’s one should think it’s should to and margin, new come on And if have have norm you be gross seen. I on that expect the levels? the going And mean or back at in came other original consider highest your the helpful. this I margin to gross gained XX.X%, we expertise one we you

Tim Cabral

saw nearing provider quarter you Yes, the the our few the efficient of was and I great one, job think of margin spend quarter-over-quarter are perspective. had old infrastructure really a where to our starting the from sort that on is of with reduction efficiency reduction NTT in end saw and AWS, you great subscription were things, number be there, we doing a we team how this with the infrastructure learn NTT big to spend

through from be the we margin, would the AWS after or subscription NTT the this a yeah, AWS So thought to I is we migration. gross of think sort where we got

margin, revenue, we would -- we On I really is norm gross outperformance XX.X% see did the in where that services did the should don’t think that margin. I XX%, with the say be. another we services see is that services

you in margin I I would little so always be give for bit probably of much, is there more think terms service so in and I color the about that’s it for think of utilization expect teams to the some how we think gross XXs the the going margin, rate the that to high a performance forward. probably

Ugam Kamat

That’s color, very you thank great much.

Operator

Your KeyBanc. Bracelin from next question with comes Brent

Your line open. is

Brent Bracelin

entering the period bit Thank a you, op a quick the divestments? Peter. I scale increased one you guide while follow-up -- thought higher where see business as to us for Peter follow-up for higher the little the here Walk well. margins and driving guide for is, process in about one a for question a and starting we’re year? The we for then through just Tim, talk full up could margins Tim with have margins, the operating drive in op are

Tim Cabral

Sure Brent.

look you having revenue it’s raise the as what function spending intra-quarter if outperformance, at obviously look us the outperformance a seeing really first it’s when margin beat there first up of and increased really and revenue so revenue we’re Brent, you year. is perspective, the the sort that So you’re hard to that at performance, in rest ramp for that and from has margin that performance to about of operating heard the before a half it’s talk offset drove the the outperformance the half we of primarily have

invest the of second same gross improving helps the the the and from half question, it the enables with margin, prior Now with more the time that performance, at deliver us, bottom-line as operating to in year margin results prepared guide. and I good aggressively I how to terms in of the think to my said higher showing about would so margin remarks, that’s it operating continue while Brent,

Brent Bracelin

Nitro. then on follow-up helpful. Very you a to just Peter And

you any scope through just a that additional outside that of in of first around very believe talked broader be adopter of larger Nitro, interest interest about that a the a early seeing opportunity early something your product? sort small walk maybe will your Thanks. there customers, is customer this could of you small you’re You for the being customer, high around color

Peter Gassner

to are all a so and will customers of seeing any all field, do our area regions. the sciences for spend all be because this they is of of it Any across will size Yes, I commercial -- we first customer to life their a which this, optimize of of area that sure. think offering have critical customer have must a applicable large have data need productivity,

the of the in those project, wants start late the adopters find to so is right there because is it things all get have and do take customers, when customer the timing, end. an they have time, replacement then to the it’ll and such middle of around, activity to then that we replacement, have Now the gets we product project beginning, existing flurry large the system, so to a so till success a our slow in there’s maturity

CRM. pattern what happened So follow a to similar very in I it think will

Now to as plug that about building wasn’t have we didn’t were just something, the replace case, anything customer, they thinking right they the as small far it so in.

Brent Bracelin

helpful, Very thank you.

Peter Gassner

that answer Brent? your question Did

Brent Bracelin

thank yes, it Yes did, you.

Peter Gassner

Thanks.

Operator

from question comes Peterson Raymond next with Your Brian James.

is line open. Your

Kevin Smith

thanks Hi for for Brian, my guys, here Kevin taking call. on

that call coincidental? out one one, there earlier more anticipated, really than handful a mentioned anything saw closing bit you regarding is or you Just of to specific was quick just Vault deals a there go-lives

Peter Gassner

particularly like stuff weren’t meaningful So think or of were but it’s do don’t was that a decided things there are, we those Vault are much it close start I to Vault that specific going And was it they think earlier. the although And that that ones, thought to we these except customers that never projects sale that I story CRM. think were were they just start their able was I which actually not because we early, remember that there projects know. were to try to don’t I there’s deals there early, you and some guys that we were as later do, customer nothing

Kevin Smith

thanks. it, Got

Operator

to session for the to closing the I’d This for Q&A it Peter remarks. concludes back turn any like now conference.

Peter Gassner

many for great your seeing the outstanding your deliver to Have Veeva was our Day that great team customers. for thank allows to time. of forward you a look quarter and October again Xth. excellence and at in consistently a It Veeva New execution, to for Analyst on you on Thanks our evening. York work, product for focus we And us

Operator

call. conference today’s concludes This

now disconnect. You may

Veeva Systems (VEEV) 23 Aug 182019 Q2 Earnings call transcript