Veeva Systems Q2 Earnings Call Highlights

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Commercial-cloud growth was broad-based across CRM, content, data products, Crossix and Ostro. Veeva cited strong CRM momentum, including Vault CRM selections from Eli Lilly, Biogen and Regeneron, and sees potential to win back customers that encountered challenges with Salesforce implementations.

Falcon AI is emerging as a major growth focus , with strong customer interest in AI agents designed to improve efficiency, compliance and costs. Veeva is also investing in newer clinical products such as EDC, eCOA, RTSM, Safety and LIMS, while developing its horizontal CRM initiative, Aspen.

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Veeva Systems (NYSE:VEEV) reported fiscal 2027 second-quarter revenue of $928 million and non-GAAP operating income of $416 million, with Chief Executive Officer Peter Gassner saying results exceeded the company's guidance. Management highlighted record CRM performance, broad commercial-cloud momentum and growing customer interest in its AI offerings.

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Van Wagener said commercial-cloud growth was not driven by a single offering. Instead, performance was broad-based across CRM, content, data products, Crossix and Ostro. Crossix continued to have "a lot of headroom for growth," he said, while CRM revenue continued to grow despite prior investor concerns that the category could decline.

Veeva's commercial performance also reflected new customers and brands in Data Cloud, growth in Crossix measurement and audiences, and demand for CRM add-ons and content products, according to Van Wagener.

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Paul Shawah, Veeva's executive vice president of strategy, said the company had an "exceptional" CRM quarter, citing Vault CRM selections by Eli Lilly, Biogen and Regeneron. He attributed the wins to customer trust in Veeva's ability to deliver and to product performance. Shawah said Veeva has commitments from 12 of the top 20 biopharma companies, with two remaining decisions expected by the end of the year.

Management also discussed customers that previously chose Salesforce over Veeva CRM. Gassner said a handful of large customers selected Salesforce, in some cases about two years ago, but those implementations have encountered delays and challenges because of the complexity of the product. He said Veeva believes it could win back some of those customers, potentially in full or in selected regions, with most potential win-backs occurring in 2027 and 2028.

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"We want to be your plan B," Gassner said of Veeva's discussions with those customers. Veeva CRM remains available as a backstop through the end of 2029, he noted.

Gassner described Veeva Falcon as a new category for the company: "agentic labor." Unlike Veeva's traditional cloud software, data and consulting businesses, Falcon is intended to perform work through AI agents. He said customer interest is high, particularly because organizations see potential for cost savings, compliance improvements and greater efficiency.

However, Gassner said Veeva is currently the limiting factor because it needs to further prepare the product and work with early adopters. He emphasized that Falcon deployments should not require the extensive data mapping, system cutovers or extract-transform-load work often associated with enterprise software implementations.

Veeva expects Falcon sales to be directed primarily toward business-unit leaders and operations executives rather than IT departments. Gassner said the company's initial focus is on life-sciences sponsors, though service providers have also expressed interest. He said Falcon could eventually be used by outsourced service providers, but Veeva is prioritizing sponsor use cases first.

On regulatory requirements, Gassner said agentic labor is non-deterministic and therefore requires training and guardrails similar to those used for human workers. Falcon includes human-in-the-loop capabilities that let users review an agent's work within a Vault application, he said.

Gassner said he expects Falcon's gross margins to be broadly similar to Veeva's software margins over time. He said Veeva is placing more functionality in deterministic software layers and expects AI-model costs to decline over time through hardware improvements, open-weight models or other technology advances.

Van Wagener said Veeva's R&D business is in the middle of a transition from established products toward newer growth offerings. Earlier growth was supported by products including eTMF, CTMS, QualityDocs, Veeva QMS and the company's regulatory suite.

Looking further out, Veeva sees growth opportunities in Veeva EDC, eCOA, RTSM, Safety and LIMS. Van Wagener described each as a large and strategic market opportunity, though all remain relatively early in their development cycles. He said the timing of their growth curves does not align exactly, which is reflected in the company's outlook for the rest of the fiscal year.

Gassner said Veeva has EDC relationships with nine of the top 20 biopharma companies. He characterized EDC implementations as long-cycle projects and said the company expects continued progress over the next several years. Veeva is also expanding its clinical portfolio with site solutions and eSource capabilities.

Veeva also discussed Aspen, its emerging horizontal CRM initiative. Gassner called Aspen a startup within Veeva, operating with small investment levels and focused on early customers and rapid product iteration. He said the company is targeting nimble technology startups initially and is confident there is demand for a new approach to horizontal CRM.

Aspen's public pricing model is designed to be simpler and more predictable than traditional enterprise software pricing, according to Gassner. The company has discussed a price of $50 per user per month, with potential overage charges for unusual levels of data storage or compute usage.

Gassner said Aspen aims to address concerns around unpredictable pricing, vendor dependability, scalability, heavy data-entry requirements and lengthy CRM implementations. He said AI could reduce much of the data entry required in existing CRM systems.

In Data Cloud, Veeva said OpenData, Compass and Link are key areas of progress. Gassner described OpenData as clean reference data, Compass as particularly useful in certain complex-therapy markets, and Link as a market-leading product with expansion opportunities in medical insights, key accounts and congress workflows. While data products tend to grow gradually, he said they are strategically valuable because they work alongside Veeva's applications, consulting services and AI agents.

Management also said its partnership with IQVIA has been productive. Gassner said customers appreciate reduced friction in working with the two companies and that greater collaboration across software, data and services could benefit the life-sciences industry.

Veeva Systems (NYSE: VEEV) is a cloud software company that develops industry-specific applications and data solutions for the global life sciences sector. Founded in 2007 and headquartered in Pleasanton, California, Veeva focuses on helping pharmaceutical, biotechnology, medical device and consumer health companies manage regulated content, clinical and regulatory processes, quality systems, and commercial operations in a compliant, cloud-native environment. The company completed its initial public offering in 2013 and has since expanded its product suite and international footprint.

Veeva's product portfolio centers on its Vault platform and related application suites, which provide content and data management, clinical trial and regulatory workflows, quality management, and structured commercial capabilities such as customer relationship management and promotional content management.

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