$VEEV Veeva Systems Q3 2026 Earnings Conference Call

This video provides an in-depth exploration of Veeva Systems' fiscal 2026 third-quarter financial results and strategic initiatives, as discussed during their earnings conference call. The call, primarily a Q&A session with CEO Peter Gastner, EVP Strategy Paul Shawa, and CFO Brian Van Wagner, highlights Veeva's strong performance with total revenue of $811 million and non-GAAP operating income of $365 million, exceeding guidance. A central theme is the significant progress and potential of "Veeva AI," which is positioned as a major initiative for customers, the industry, and Veeva itself. The discussion also covers innovation across all product areas, including Vault CRM, Crossix, clinical, and safety solutions.

The conversation delves deeply into the ongoing migration of top 20 pharmaceutical customers to Vault CRM, noting that 14 are expected to migrate, with six potentially opting for other solutions. While acknowledging potential revenue at risk, Veeva emphasizes the multi-year nature of these projects and the overall health of its CRM business, which now constitutes about 20% of total revenue, down from 25% two years prior due to growth in other product areas. The company expresses confidence in retaining customers and the potential for "win-backs," driven by the integrated value proposition of the broader CRM suite, including new add-ons like Service Center, Marketing Automation, and Patient CRM. Veeva's strategy for smaller customers, who prefer integrated solutions over custom builds, is also highlighted.

Beyond CRM, the call explores Veeva's R&D (Development Cloud) and Quality Cloud segments. In R&D, discussions include the competitive landscape in the Electronic Data Capture (EDC) market, the importance of integrated solutions for clinical operations and data, and future innovations aimed at bridging sponsors with clinical research sites and improving patient recruitment. Safety systems are identified as a significant opportunity, particularly with AI, despite long sales cycles and the inherent complexity of global drug safety. The Quality Cloud is noted for its expanding market reach, including CDMOs and manufacturing plants, driven by its unique platform approach encompassing quality documentation, quality management systems (QMS), and GxP training, with new products like batch release, computer systems validation, and Laboratory Information Management Systems (LIMS) showing promise. The company also touches on the positive impact of its partnership with IQVIA, enhancing interoperability and customer confidence across commercial and clinical domains, and the strategic importance of its "Veeva Basics" offering for small biotechs.

Key Takeaways:

• Strong Financial Performance: Veeva reported excellent Q3 2026 results with $811 million in total revenue and $365 million in non-GAAP operating income, surpassing guidance, indicating robust execution across the business.
• Veeva AI as a Strategic Pillar: AI is a major initiative, with significant progress expected to deliver practical, value-adding, industry-specific solutions for customers, particularly in automating tasks like insight generation in CRM, increasing efficiency in safety case processing, and streamlining clinical operations.
• Vault CRM Migration Dynamics: 14 of the top 20 customers are expected to migrate to Vault CRM, with 6 potentially choosing other solutions. While this presents some revenue risk, it's considered a multi-year transition with no material impact expected in the short term, and Veeva anticipates win-backs and continued growth from its broader customer base.
• CRM Business Evolution: CRM now accounts for approximately 20% of Veeva's total revenue, down from 25% two years ago, reflecting the diversification and growth of other product areas. The overall CRM business remains healthy, particularly with smaller customers who prefer integrated solutions.
• Integrated Commercial Cloud Strategy: Veeva is building a comprehensive "industry cloud" for life sciences, connecting CRM, commercial content, Crossix, and data assets on a common platform. This integration aims to provide significant competitive advantage and synergy for customers.
• R&D Cloud Momentum: Veeva continues to see strong momentum in its Development Cloud, with 20 out of the top 20 customers having selected their ETMF solution. Future innovations in clinical, safety, and quality are expected to drive efficiency and address complex industry needs.
• Safety Systems as a High-Potential Area: Veeva Safety is a complex but high-potential area, with AI expected to drive faster adoption by reducing labor and improving efficiency in adverse event processing. The company's eight-year investment in this area creates a significant competitive moat.
• Crossix as a Growth Driver: Crossix continues to be a strong growth driver, benefiting from increased digital marketing spend in the life sciences, the growing importance of measurement and optimization, and its expanding role as an industry standard.
• Healthy Pharma Macro Environment: The pharmaceutical industry remains healthy, with steady demand driven by ongoing scientific evolution and the need to address uncured diseases, leading to no material changes in customer buying behaviors.
• Strategic Role of Business Consulting: Veeva's integrated approach combines software, data, and consulting services, positioning the company as a "general contractor" for life sciences. Business consulting plays a critical role in change management and driving broader platform adoption.
• AI Monetization Across Segments: AI's value is expected to be broadly even across commercial and R&D, with implementations focusing on insight generation and agility in commercial, and labor reduction in areas like safety and clinical operations.
• Veeva Basics for Small Biotechs: The Veeva Basics offering, with over 100 customers, supports the smaller end of the life sciences industry, providing professional solutions that allow companies to scale to enterprise Veeva without changing systems, fostering overall industry growth.
• Long-Term Vision and Competitive Advantage: Veeva's long-term commitment to life sciences, its integrated platform approach, and continuous innovation (especially with AI) are seen as key competitive advantages against competitors who may offer less comprehensive or industry-specific solutions.

Tools/Resources Mentioned:

• Veeva Vault CRM Suite
• Veeva Medical
• Veeva PromoMats
• Veeva Crossix
• Veeva OpenData
• Veeva Link
• Veeva Compass
• Veeva CRM Pulse
• Veeva Clinical Platform
• Veeva Clinical Data Management
• Veeva Safety
• Veeva RIM (Regulatory Information Management)
• Veeva Quality Cloud (Quality Documentation, QMS, GxP Training, Batch Release, Computer Systems Validation, LIMS)
• Veeva Basics
• Salesforce.com (as a platform/competitor for CRM)
• AWS (Amazon Web Services)
• Microsoft (as a partner for AI)
• Anthropic (as a partner for AI)
• IQVIA (strategic partner)
• Doximity (digital avenue for HCPs)
• Open Evidence (digital avenue for HCPs)

Key Concepts:

• Veeva AI: Veeva's overarching initiative to embed artificial intelligence, including Large Language Models (LLMs) and AI agents, across its product suite for intelligent automation and insight generation.
• Industry Cloud: Veeva's strategy to provide a comprehensive, integrated suite of software, data, and consulting services tailored specifically for the life sciences industry.
• Vault CRM: Veeva's next-generation CRM platform, designed to replace its legacy Salesforce-based CRM, offering deeper integration with other Veeva Vault applications.
• Development Cloud: Veeva's suite of applications for R&D, including clinical operations, clinical data management, safety, and regulatory information management.
• Quality Cloud: Veeva's solutions for quality management, including documentation, QMS, GxP training, and manufacturing quality control.
• ETMF (Electronic Trial Master File): A system for managing and storing essential clinical trial documents.
• EDC (Electronic Data Capture): Software used in clinical trials to collect and manage patient data.
• RTSM (Randomization and Trial Supply Management): Systems for managing patient randomization and drug supply in clinical trials.
• Ecoa (Electronic Clinical Outcome Assessment): Digital tools for collecting patient-reported outcomes in clinical trials.
• LIMS (Laboratory Information Management System): Software for managing laboratory samples, experiments, and results, particularly in manufacturing quality control.
• GxP: A set of good practice guidelines (e.g., Good Manufacturing Practice, Good Clinical Practice) for regulated industries.
• 21 CFR Part 11: FDA regulations on electronic records and electronic signatures.
• Probabilistic Computing: An AI concept related to making predictions or decisions based on probabilities, often in the context of LLMs.

Examples/Case Studies:

• Top 20 CRM Migrations: Discussion centered on the migration status of the top 20 pharmaceutical companies to Veeva's Vault CRM, with 14 committed and 6 undecided or opting for alternatives, highlighting the strategic importance of these large clients.
• EDC Customer Win-Back: A specific instance where a top 20 customer decided to revert to a previous EDC provider, which Veeva characterized as an "aberration" rather than a trend, emphasizing its strong pipeline and integrated solution approach.
• LIMS Early Adopter: Mention of the first early adopter in the top 20 for Veeva's LIMS product for two manufacturing sites, signaling entry into a new, significant market segment within quality.
• IQVIA Partnership: The strategic partnership with IQVIA was cited as a positive macro-level trend, improving interoperability and customer confidence for joint clients across commercial and clinical operations.