We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Veeva Systems (VEEV) Q4 Earnings Surpass Estimates, Margins Up
Read MoreHide Full Article
Veeva Systems, Inc. (VEEV - Free Report) reported adjusted earnings per share (EPS) of $1.38 for the fourth quarter of fiscal 2024, which increased 20% from the year-ago EPS of $1.15. Adjusted EPS surpassed the Zacks Consensus Estimate by 6.2%.
GAAP EPS in the fiscal fourth quarter was 90 cents, down 22.4% from the year-ago period’s $1.16.
Full-year fiscal 2024 adjusted EPS was $4.84, up 13.1% compared with that at the end of the comparable fiscal 2023 period. The figure topped the Zacks Consensus Estimate by 1.7%.
Revenues
For the quarter, the company’s revenues totaled $630.6 million, outpacing the Zacks Consensus Estimate by 1.6%. On a year-over-year basis, the top line improved 11.9%.
The fiscal fourth-quarter top line was driven by Veeva Systems’ robust segmental performances.
Full-year fiscal 2024 revenues were $2.36 billion, which increased 9.7% from the comparable fiscal 2023 period. The figure topped the Zacks Consensus Estimate by 0.4%.
Segmental Details
Veeva Systems derives revenues from two operating segments — Subscription services and Professional services and other.
In the fiscal fourth quarter, Subscription services revenues improved 13.3% from the year-ago quarter to $521.5 million. Our projection for fiscal fourth-quarter revenues was $517.1 million.
Professional services and other revenues were up 5.7% year over year to $109.1 million, primarily resulting from continued strength in Research and Development (R&D) Solutions services and Veeva Business Consulting. Our projection for fiscal fourth-quarter revenues was $103.5 million.
Veeva Systems Inc. Price, Consensus and EPS Surprise
In the quarter under review, Veeva Systems’ gross profit improved 14.4% to $456.7 million. The gross margin expanded 158 basis points (bps) to 72.4%.
We had projected 70.5% of gross margin for the fiscal fourth quarter.
Sales and marketing expenses rose 11.4% to $99.2 million. R&D expenses went up 14.8% year over year to $163.6 million, while general and administrative expenses climbed 0.2% year over year to $58.7 million. Total operating expenses of $321.4 million increased 10.8% year over year.
Operating profit totaled $135.3 million, which increased 24.2% from the prior-year quarter. The operating margin in the fiscal fourth quarter expanded 212 bps to 21.4%.
We had projected 18.7% of operating margin for the fiscal fourth quarter.
Financial Position
The company exited fiscal 2024 with cash and cash equivalents and short-term investments of $4.03 billion compared with $3.10 billion at fiscal 2023-end.
Cumulative net cash provided by operating activities at the end of fiscal 2024 was $911.3 million compared with $780.5 million at fiscal 2023-end.
Guidance
Veeva Systems has revised its financial outlook for fiscal 2025 and provided its estimates for the first quarter of fiscal 2025.
For the first quarter of fiscal 2025, the company expects total revenues between $640 million and $643 million. The Zacks Consensus Estimate is currently pegged at $644.5 million.
Subscription revenues and Professional services and other revenues are estimated to be approximately $529 million and $111-$114 million, respectively, in the fiscal first quarter.
Adjusted EPS is projected between $1.42 and $1.43. The Zacks Consensus Estimate is pegged at $1.26.
Veeva Systems expects revenues for fiscal 2025 between $2,725 million and $2,740 million, lower than the earlier outlook of $2,750 million. The Zacks Consensus Estimate is currently pegged at $2.75 billion.
Subscription revenues are expected to be $2,250 million. This consists of Commercial Solutions’ subscription revenues of around $1,068 million and R&D Solutions’ subscription revenues of approximately $1,182 million.
Professional services and other revenues for fiscal 2025 are expected between $475 million and $490 million.
Adjusted EPS for the year is expected to be $6.16. The Zacks Consensus Estimate is pegged at $5.54.
Our Take
Veeva Systems exited the fourth quarter of fiscal 2024 with better-than-expected results. The uptick in the overall top line and adjusted EPS and robust performances by both segments during the quarter were impressive. The company continues to benefit from its flagship Vault platform, which is encouraging. VEEV saw broad-based adoption in all areas of Development Cloud, including significant top 20 biopharma wins in clinical, regulatory and quality during the quarter. The company’s continued strength in its Vault Clinical products looked promising. The expansion of both margins bodes well.
On the flip side, management sounded cautious on the earnings call about the slight decrease in the total revenue outlook for fiscal 2025 due to services and deal timing. The persistent overall macroeconomic challenges and uncertainties raise our apprehension.
Zacks Rank and Other Key Picks
Veeva Systems currently carries a Zacks Rank #2 (Buy).
A few other top-ranked stocks in the broader medical space that have announced quarterly results are Cencora, Inc. (COR - Free Report) , Elevance Health, Inc. (ELV - Free Report) and Cardinal Health, Inc. (CAH - Free Report) .
Cencora, carrying a Zacks Rank of 2, reported first-quarter fiscal 2024 adjusted EPS of $3.28, beating the Zacks Consensus Estimate by 14.7%. Revenues of $72.25 billion outpaced the consensus mark by 5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cencora has a long-term estimated growth rate of 9.8%. COR’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.7%.
Elevance Health reported fourth-quarter 2023 adjusted EPS of $5.62, beating the Zacks Consensus Estimate by 1.3%. Revenues of $42.45 billion outpaced the consensus mark by 1.5%. It currently carries a Zacks Rank #2.
Elevance Health has a long-term estimated growth rate of 12%. ELV’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.1%.
Cardinal Health reported second-quarter fiscal 2024 adjusted EPS of $1.82, beating the Zacks Consensus Estimate by 16.7%. Revenues of $57.45 billion surpassed the Zacks Consensus Estimate by 1.1%. It currently flaunts a Zacks Rank #1.
Cardinal Health has a long-term estimated growth rate of 14.2%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 15.6%.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Veeva Systems (VEEV) Q4 Earnings Surpass Estimates, Margins Up
Veeva Systems, Inc. (VEEV - Free Report) reported adjusted earnings per share (EPS) of $1.38 for the fourth quarter of fiscal 2024, which increased 20% from the year-ago EPS of $1.15. Adjusted EPS surpassed the Zacks Consensus Estimate by 6.2%.
GAAP EPS in the fiscal fourth quarter was 90 cents, down 22.4% from the year-ago period’s $1.16.
Full-year fiscal 2024 adjusted EPS was $4.84, up 13.1% compared with that at the end of the comparable fiscal 2023 period. The figure topped the Zacks Consensus Estimate by 1.7%.
Revenues
For the quarter, the company’s revenues totaled $630.6 million, outpacing the Zacks Consensus Estimate by 1.6%. On a year-over-year basis, the top line improved 11.9%.
The fiscal fourth-quarter top line was driven by Veeva Systems’ robust segmental performances.
Full-year fiscal 2024 revenues were $2.36 billion, which increased 9.7% from the comparable fiscal 2023 period. The figure topped the Zacks Consensus Estimate by 0.4%.
Segmental Details
Veeva Systems derives revenues from two operating segments — Subscription services and Professional services and other.
In the fiscal fourth quarter, Subscription services revenues improved 13.3% from the year-ago quarter to $521.5 million. Our projection for fiscal fourth-quarter revenues was $517.1 million.
Professional services and other revenues were up 5.7% year over year to $109.1 million, primarily resulting from continued strength in Research and Development (R&D) Solutions services and Veeva Business Consulting. Our projection for fiscal fourth-quarter revenues was $103.5 million.
Veeva Systems Inc. Price, Consensus and EPS Surprise
Veeva Systems Inc. price-consensus-eps-surprise-chart | Veeva Systems Inc. Quote
Margin Details
In the quarter under review, Veeva Systems’ gross profit improved 14.4% to $456.7 million. The gross margin expanded 158 basis points (bps) to 72.4%.
We had projected 70.5% of gross margin for the fiscal fourth quarter.
Sales and marketing expenses rose 11.4% to $99.2 million. R&D expenses went up 14.8% year over year to $163.6 million, while general and administrative expenses climbed 0.2% year over year to $58.7 million. Total operating expenses of $321.4 million increased 10.8% year over year.
Operating profit totaled $135.3 million, which increased 24.2% from the prior-year quarter. The operating margin in the fiscal fourth quarter expanded 212 bps to 21.4%.
We had projected 18.7% of operating margin for the fiscal fourth quarter.
Financial Position
The company exited fiscal 2024 with cash and cash equivalents and short-term investments of $4.03 billion compared with $3.10 billion at fiscal 2023-end.
Cumulative net cash provided by operating activities at the end of fiscal 2024 was $911.3 million compared with $780.5 million at fiscal 2023-end.
Guidance
Veeva Systems has revised its financial outlook for fiscal 2025 and provided its estimates for the first quarter of fiscal 2025.
For the first quarter of fiscal 2025, the company expects total revenues between $640 million and $643 million. The Zacks Consensus Estimate is currently pegged at $644.5 million.
Subscription revenues and Professional services and other revenues are estimated to be approximately $529 million and $111-$114 million, respectively, in the fiscal first quarter.
Adjusted EPS is projected between $1.42 and $1.43. The Zacks Consensus Estimate is pegged at $1.26.
Veeva Systems expects revenues for fiscal 2025 between $2,725 million and $2,740 million, lower than the earlier outlook of $2,750 million. The Zacks Consensus Estimate is currently pegged at $2.75 billion.
Subscription revenues are expected to be $2,250 million. This consists of Commercial Solutions’ subscription revenues of around $1,068 million and R&D Solutions’ subscription revenues of approximately $1,182 million.
Professional services and other revenues for fiscal 2025 are expected between $475 million and $490 million.
Adjusted EPS for the year is expected to be $6.16. The Zacks Consensus Estimate is pegged at $5.54.
Our Take
Veeva Systems exited the fourth quarter of fiscal 2024 with better-than-expected results. The uptick in the overall top line and adjusted EPS and robust performances by both segments during the quarter were impressive. The company continues to benefit from its flagship Vault platform, which is encouraging. VEEV saw broad-based adoption in all areas of Development Cloud, including significant top 20 biopharma wins in clinical, regulatory and quality during the quarter. The company’s continued strength in its Vault Clinical products looked promising. The expansion of both margins bodes well.
On the flip side, management sounded cautious on the earnings call about the slight decrease in the total revenue outlook for fiscal 2025 due to services and deal timing. The persistent overall macroeconomic challenges and uncertainties raise our apprehension.
Zacks Rank and Other Key Picks
Veeva Systems currently carries a Zacks Rank #2 (Buy).
A few other top-ranked stocks in the broader medical space that have announced quarterly results are Cencora, Inc. (COR - Free Report) , Elevance Health, Inc. (ELV - Free Report) and Cardinal Health, Inc. (CAH - Free Report) .
Cencora, carrying a Zacks Rank of 2, reported first-quarter fiscal 2024 adjusted EPS of $3.28, beating the Zacks Consensus Estimate by 14.7%. Revenues of $72.25 billion outpaced the consensus mark by 5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cencora has a long-term estimated growth rate of 9.8%. COR’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.7%.
Elevance Health reported fourth-quarter 2023 adjusted EPS of $5.62, beating the Zacks Consensus Estimate by 1.3%. Revenues of $42.45 billion outpaced the consensus mark by 1.5%. It currently carries a Zacks Rank #2.
Elevance Health has a long-term estimated growth rate of 12%. ELV’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.1%.
Cardinal Health reported second-quarter fiscal 2024 adjusted EPS of $1.82, beating the Zacks Consensus Estimate by 16.7%. Revenues of $57.45 billion surpassed the Zacks Consensus Estimate by 1.1%. It currently flaunts a Zacks Rank #1.
Cardinal Health has a long-term estimated growth rate of 14.2%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 15.6%.