Veeva Systems 10-Q 2024-04-30

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 10-Q

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(Mark One)

☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 30, 2024

OR

☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 001-36121

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Veeva Systems Inc.

(Exact name of registrant as specified in its charter)

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Delaware						20-8235463
(State or other jurisdiction of incorporation or organization)			(IRS Employer Identification No.)

4280 Hacienda Drive

Pleasanton, California, 94588

(Address of principal executive offices, including zip code)

(Registrant’s telephone number, including area code) (925) 452-6500

(Former name, former address and former fiscal year, if changed since last report) N/A

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Securities registered pursuant to Section 12(b) of the Act:

Title of each class						Trading Symbol						Name of each exchange on which registered
Class A Common Stock, par value $0.00001 per share						VEEV						The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer			☒			Accelerated filer			☐
Non-accelerated filer			☐			Smaller reporting company			☐
Emerging growth company			☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 31, 2024, there were 161,651,713 shares of the Registrant’s Class A common stock outstanding. We refer to our Class A common stock as our “common stock.”

VEEVA SYSTEMS INC.

FORM 10-Q

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION						4
Item 1.			Financial Statements			4
			Condensed Consolidated Balance Sheets			4
			Condensed Consolidated Statements of Comprehensive Income			5
			Condensed Consolidated Statements of Stockholders’ Equity			6
			Condensed Consolidated Statements of Cash Flows			7
			Notes to Condensed Consolidated Financial Statements			8
			Note 1. Summary of Business and Significant Accounting Policies			8
			Note 2. Short-Term Investments			9
			Note 3. Deferred Costs			10
			Note 4. Property and Equipment, Net			10
			Note 5. Goodwill and Intangible Assets			11
			Note 6. Accrued Expenses			12
			Note 7. Fair Value Measurements			12
			Note 8. Income Taxes			14
			Note 9. Deferred Revenue, Performance Obligations, and Unbilled Accounts Receivable			14
			Note 10. Leases			14
			Note 11. Stockholders’ Equity			15
			Note 12. Net Income per Share			16
			Note 13. Commitments and Contingencies			17
			Note 14. Revenues by Product			19
			Note 15. Information about Geographic Areas			19
Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
			Overview			21
			Components of Results of Operations			21
			Results of Operations			24
			Operating Expenses and Operating Margin			26
			Non-GAAP Financial Measures			27
			Liquidity and Capital Resources			29
			Critical Accounting Policies and Estimates			31
Item 3.			Quantitative and Qualitative Disclosures About Market Risk			32
Item 4.			Controls and Procedures			33
PART II. OTHER INFORMATION						34
Item 1.			Legal Proceedings			34
Item 1A			Risk Factors			35
Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds			58
Item 3.			Defaults Upon Senior Securities			58
Item 4.			Mine Safety Disclosures			58
Item 5.			Other Information			58
Item 6.			Exhibits			59
SIGNATURES						61

2			Veeva Systems Inc. | Form 10-Q

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report on Form 10-Q contains forward-looking statements that are based on our beliefs and assumptions and on information currently available to us. Forward-looking statements include information concerning our possible or assumed future results of operations and expenses, business strategies and plans, trends, market sizing, competitive position, industry environment, potential growth opportunities, and product capabilities among other things. Forward-looking statements include all statements that are not historical facts and, in some cases, can be identified by terms such as “aim,” “anticipates,” “believes,” “could,” “estimates,” “expects,” “goal,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “seeks,” “should,” “strive,” “will,” “would,” or similar expressions and the negatives of those terms.

Forward-looking statements are based on our current views and expectations and involve known and unknown risks, uncertainties and other factors—including those described in “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this report—that may cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

Any forward-looking statements in this report are made only as of the date of this report. Except as required by law, we disclaim any obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

As used in this report, the terms “Veeva,” “Registrant,” “the Company,” “we,” “us,” and “our” mean Veeva Systems Inc. and its subsidiaries unless the context indicates otherwise.

Veeva Systems Inc. | Form 10-Q			3

PART I. FINANCIAL INFORMATION

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except number of shares and par value)

(Unaudited)

			April 30, 2024						January 31, 2024
Assets
Current assets:
Cash and cash equivalents			$	1,197,196					$	703,487
Short-term investments			3,567,841						3,324,269
Accounts receivable, net of allowance for doubtful accounts of $216 and $520, respectively			362,320						852,172
Unbilled accounts receivable			38,771						36,365
Prepaid expenses and other current assets			78,820						86,918
Total current assets			5,244,948						5,003,211
Property and equipment, net			58,042						58,532
Deferred costs, net			23,967						23,916
Lease right-of-use assets			44,583						45,602
Goodwill			439,877						439,877
Intangible assets, net			58,231						63,017
Deferred income taxes			266,060						233,463
Other long-term assets			51,850						43,302
Total assets			$	6,187,558					$	5,910,920
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable			$	31,930					$	31,513
Accrued compensation and benefits			38,755						43,433
Accrued expenses and other current liabilities			41,187						32,980
Income tax payable			71,567						11,862
Deferred revenue			1,029,455						1,049,761
Lease liabilities			10,392						9,334
Total current liabilities			1,223,286						1,178,883
Deferred income taxes			705						2,052
Lease liabilities, noncurrent			45,351						46,441
Other long-term liabilities			28,835						38,720
Total liabilities			1,298,177						1,266,096
Commitments and contingencies (note 13)
Stockholders’ equity:
Common stock			2						2
Additional paid-in capital			2,017,904						1,915,002
Accumulated other comprehensive loss			(30,646)						(10,637)
Retained earnings			2,902,121						2,740,457
Total stockholders’ equity			4,889,381						4,644,824
Total liabilities and stockholders’ equity			$	6,187,558					$	5,910,920

See Notes to Condensed Consolidated Financial Statements.

4			Veeva Systems Inc. | Form 10-Q

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands, except per share data)

(Unaudited)

			Three months ended April 30,
			2024						2023
Revenues:
Subscription services			$	533,955					$	414,546
Professional services and other			116,390						111,779
Total revenues			650,345						526,325
Cost of revenues**(1)****:**
Cost of subscription services			78,148						67,575
Cost of professional services and other			95,736						99,088
Total cost of revenues			173,884						166,663
Gross profit			476,461						359,662
Operating expenses**(1)****:**
Research and development			162,711						146,960
Sales and marketing			97,301						88,503
General and administrative			61,277						62,669
Total operating expenses			321,289						298,132
Operating income			155,172						61,530
Other income, net			51,729						30,248
Income before income taxes			206,901						91,778
Income tax provision (benefit)			45,237						(39,743)
Net income			$	161,664					$	131,521
Net income per share:
Basic			$	1.00					$	0.82
Diluted			$	0.98					$	0.81
Weighted-average shares used to compute net income per share:
Basic			161,421						159,852
Diluted			164,394						162,521

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You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our condensed consolidated financial statements and notes thereto appearing elsewhere in this report. In addition to historical condensed consolidated financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties, and assumptions. Our actual results could differ materially from those anticipated by these forward-looking statements as a result of many factors. We discuss factors that we believe could cause or contribute to these differences below and elsewhere in this report, including those set forth under “Risk Factors” and “Special Note Regarding Forward-Looking Statements.”

Overview

Veeva is the leading provider of industry cloud solutions for the global life sciences industry. Our offerings span cloud software, data, and business consulting and are designed to meet the unique needs of our customers and their most strategic business functions—from research and development (R&D) through commercialization. Our solutions help life sciences companies develop and bring products to market faster and more efficiently, market and sell more effectively, and maintain compliance with government regulations. For a more detailed description of our business and products as of January 31, 2024, please see our Annual Report on Form 10-K for the fiscal year ended January 31, 2024 filed on March 25, 2024.

Our industry cloud solutions are grouped into three major product categories—Veeva Development Cloud, Veeva Commercial Cloud, and Veeva Data Cloud. For financial reporting purposes, revenues associated with our Veeva Commercial Cloud, Veeva Data Cloud, and Veeva Claims solutions are classified as “Commercial Solutions” revenues, and revenues associated with our Veeva Development Cloud, Veeva RegulatoryOne, and Veeva QualityOne solutions are classified as “R&D Solutions” revenues.

In our fiscal year ended January 31, 2024, we derived approximately 52% and 48% of our subscription services revenues and 50% and 50% of our total revenues from our Commercial Solutions and R&D Solutions, respectively. For the three months ended April 30, 2024, we derived approximately 49% and 51% of our subscription services revenues and 48% and 52% of our total revenues from our Commercial Solutions and R&D Solutions, respectively. Revenues associated with our R&D Solutions are expected to increase as a percentage of both subscription services revenues and total revenues in the future. We also offer certain of our R&D Solutions to industries outside the life sciences industry primarily in North America and Europe.

For our fiscal years ended January 31, 2024, 2023, and 2022, our total revenues were $2,364 million, $2,155 million, and $1,851 million, respectively, representing year-over-year growth in total revenues of 10% in our fiscal year ended January 31, 2024 and 16% in our fiscal year ended January 31, 2023. For our fiscal years ended January 31, 2024, 2023, and 2022, our subscription services revenues were $1,902 million, $1,733 million, and $1,484 million, respectively, representing year-over-year growth in subscription services revenues of 10% in our fiscal year ended January 31, 2024, and 17% in our fiscal year ended January 31, 2023. We generated net income of $526 million, $488 million, and $427 million for our fiscal years ended January 31, 2024, 2023, and 2022, respectively.

As of January 31, 2024, 2023, and 2022, we served 1,432, 1,388, and 1,205 customers, respectively. As of January 31, 2024, 2023, and 2022, we had 693, 684, and 653 Commercial Solutions customers, respectively, and 1,078, 1,025, and 860 R&D Solutions customers, respectively. These customer count totals are net of customer attrition during each period. The combined customer counts for Commercial Solutions and R&D Solutions exceed the total customer count in each year because some customers subscribe to products in both areas. Many of our applications for R&D are used by smaller, earlier stage, pre-commercial companies, some of which may not reach the commercialization stage.

Components of Results of Operations

Revenues

We derive our revenues primarily from subscription services fees and professional services fees. Subscription services revenues consist of fees from customers accessing our cloud-based software solutions and fees for our data solutions. Professional services and other revenues consist primarily of fees from implementation services,

Veeva Systems Inc. | Form 10-Q			21

configuration, data services, training, and managed services related to our solutions and services related to our Veeva Business Consulting offering. For the three months ended April 30, 2024, subscription services revenues constituted 82% of total revenues and professional services and other revenues constituted 18% of total revenues.

We generally enter into master subscription agreements with our customers and count each distinct master subscription agreement that has not been terminated or expired and that has orders for which we have recognized revenue in the quarter as a distinct customer for purposes of determining our total number of current customers as of the end of that quarter. We generally enter into a single master subscription agreement with each customer, although in some instances, affiliated legal entities within the same corporate family may enter into separate master subscription agreements. Conversely, affiliated legal entities that maintain distinct master subscription agreements may choose to consolidate their orders under a single master subscription agreement, and, in that circumstance, our customer count would decrease. Divisions, subsidiaries, and operating units of our customers often place distinct orders for our subscription services under the same master subscription agreement, and we do not count such distinct orders as new customers for purposes of determining our total customer count. For purposes of determining customers of Veeva Crossix that do not contract under a master subscription agreement, we count each entity that has a statement of work or services agreement and a recurring known payment obligation as a distinct customer if such entity is not otherwise a customer of ours. For Veeva Crossix, we do not count as distinct customers agencies contracting with us on behalf of brands within life sciences companies.

New subscription orders for our Veeva CRM application generally have a one-year term. If a customer adds end users or additional Commercial Solutions to an existing order for our Veeva CRM application, such additional orders will generally be coterminous with the anniversary date of the Veeva CRM order, and as a result, orders for additional end users or additional Commercial Solutions will commonly have an initial term of less than one year.

Subscription services revenues are recognized ratably over the respective non-cancellable subscription term because of the continuous transfer of control to the customer. Our master subscription agreements that govern multi-year orders generally include a termination for convenience right for our customers. The amount of revenue recognized from such orders will generally be consistent with the amount invoiced for the relevant term of the order. When such multi-year orders are non-cancellable (other than for cause), we recognize the total contracted revenue ratably over the multi-year term of the order. For such non-cancellable orders, when the amounts we are entitled to invoice in any period pursuant to multi-year orders with escalating fees are less than the revenue recognized, we accrue an unbilled accounts receivable balance (a contract asset).

Our subscription orders are generally billed at the beginning of the subscription period in annual or quarterly increments, which means the annualized value of such orders may not be completely reflected in deferred revenue at any single point in time. Also, particularly with respect to expansion orders for our Commercial Solutions, because the term of orders for additional end users or applications is commonly less than one year to align to the renewal date of existing Commercial Solutions orders, the annualized value of such orders may not be completely reflected in deferred revenue at any single point in time. We have also agreed from time to time, and may agree in the future, to allow customers to change the renewal dates of their orders to, for example, align more closely with a customer’s annual budget process or to align with the renewal dates of other orders placed by other entities within the same corporate control group, or to change payment terms from annual to quarterly, or vice versa. Such changes may result in an order of less than one year as necessary to align all orders to the desired renewal date and, thus, may result in a lesser increase to deferred revenue compared to if the adjustment had not occurred. Additionally, changes in renewal dates may change the fiscal quarter in which deferred revenue associated with a particular order is booked. Accordingly, we do not believe that changes on a quarterly basis in deferred revenue, calculated billings, or normalized billings are accurate indicators of future revenues for any given period of time. We define the term calculated billings for any period to mean revenue for the period plus the change in deferred revenue from the immediately preceding period minus the change in unbilled accounts receivable from the immediately preceding period. We define the term normalized billings for any period to mean calculated billings adjusted for the impact of term changes in renewal business, such as in the timing (for example, changing the renewal date of multiple products to be coterminous) or billing frequency (for example, changing from annual to quarterly billings).

Our agreements typically provide that orders will automatically renew unless notice of non-renewal is provided in advance. Subscription services revenues are affected primarily by the number of customers, the scope of the subscription purchased by each customer (for example, the number of end users or other subscription usage metric) and the number of solutions subscribed to by each customer.

22			Veeva Systems Inc. | Form 10-Q

We utilize our own personnel to perform our professional services and business consulting engagements with customers. In certain cases, we may utilize third-party subcontractors to perform professional services engagements. The majority of our professional services arrangements are billed on a time and materials basis and revenues are recognized over time based on time incurred and contractually agreed upon rates. Certain professional services and business consulting arrangements are billed on a fixed fee basis and revenues are typically recognized over time as the services are delivered based on time incurred. Data services and training revenues are generally recognized as the services are performed. Professional services revenues are affected primarily by our customers’ demands for implementation services, configuration, data services, training, speakers bureau logistics, and managed services in connection with our solutions. Our business consulting revenues are affected primarily by our customers’ demands for services related to a particular customer success initiative, strategic analysis, or business process change, and not by cloud software implementation.

Allocated Overhead

We accumulate certain costs such as building depreciation, office rent, utilities, and other facilities costs and allocate them across the various departments based on headcount. We refer to these costs as “allocated overhead.”

Cost of Revenues

Cost of subscription services revenues for all of our solutions consists of expenses related to our computing infrastructure provided by third parties, including Salesforce, Inc. and Amazon Web Services, personnel related costs associated with hosting our subscription services and providing support, including our data stewards, data acquisition costs, and costs of delivering our data solutions, expenses associated with computer equipment and software, and allocated overhead.

Cost of professional services and other consists primarily of employee-related expenses associated with providing professional and business consulting services. The cost of providing professional services is significantly higher as a percentage of the related revenues than for our subscription services due to the direct labor costs and costs of third-party subcontractors.

Operating Expenses

Research and Development. Research and development expenses consist primarily of employee-related expenses, third-party consulting fees, hosted infrastructure costs, and allocated overhead. We continue to focus our research and development efforts on our platforms, including adding new features and applications and increasing the functionality and enhancing the ease of use of our cloud-based applications.

Sales and Marketing. Sales and marketing expenses consist primarily of employee-related expenses, sales commissions, marketing program costs, amortization expense associated with purchased intangibles related to our customer contracts, customer relationships and brand development, travel-related expenses and allocated overhead. Marketing program costs include advertising, customer events, corporate communications, brand awareness, and product marketing activities. Sales commissions are costs of obtaining new customer contracts and are capitalized and then amortized over a period of benefit that we have determined to be three years.

General and Administrative. General and administrative expenses consist of employee-related expenses for our executive, finance and accounting, legal, employee success, management information systems personnel, and other administrative employees. In addition, general and administrative expenses include fees related to third-party legal counsel, fees related to third-party accounting, tax and audit services, other corporate expenses, and allocated overhead.

Other Income, Net

Other income, net, consists primarily of interest income, amortization of premiums paid or accretion of discounts on investments, and transaction gains or losses on foreign currency, net of hedging costs.

Veeva Systems Inc. | Form 10-Q			23

Provision for Income Taxes

Provision for income taxes consists of federal, state, and local income taxes in the United States and income taxes in certain foreign jurisdictions. See note 8 of the notes to our condensed consolidated financial statements.

Results of Operations

The following tables set forth selected condensed consolidated statements of operations data and such data as a percentage of total revenues for each of the periods indicated:

			Three months ended April 30,
			2024						2023
			(in thousands)
Consolidated Statements of Comprehensive Income Data:
Revenues:
Subscription services			$	533,955					$	414,546
Professional services and other			116,390						111,779
Total revenues			650,345						526,325
Cost of revenues(1):
Cost of subscription services			78,148						67,575
Cost of professional services and other			95,736						99,088
Total cost of revenues			173,884						166,663
Gross profit			476,461						359,662
Operating expenses(1):
Research and development			162,711						146,960
Sales and marketing			97,301						88,503
General and administrative			61,277						62,669
Total operating expenses			321,289						298,132
Operating income			155,172						61,530
Other income, net			51,729						30,248
Income before income taxes			206,901						91,778
Income tax provision (benefit)			45,237						(39,743)
Net income			$	161,664					$	131,521
(1) Includes stock-based compensation as follows:

Cost of revenues:
Cost of subscription services			$	1,554					$	1,505
Cost of professional services and other			12,535						12,722
Research and development			41,743						38,906
Sales and marketing			23,043						20,135
General and administrative			17,036						17,451
Total stock-based compensation			$	95,911					$	90,719

24			Veeva Systems Inc. | Form 10-Q

Revenues

			Three months ended April 30,
2024						2023						% Change
(dollars in thousands)
Revenues:
Subscription services			$	533,955					$	414,546					29%
Professional services and other			116,390						111,779						4%
Total revenues			$	650,345					$	526,325					24%
Percentage of revenues:
Subscription services			82		%				79		%
Professional services and other			18						21
Total revenues			100		%				100		%

Total revenues for the three months ended April 30, 2024 increased $124 million, of which $119 million was from growth in subscription services revenues. The increase in subscription services revenues consisted of $97 million of subscription services revenue attributable to R&D Solutions and $22 million of subscription services revenue attributable to Commercial Solutions. The addition of termination for convenience rights starting on February 1, 2023, reduced subscription services revenue attributable to R&D Solutions for the three months ended April 30, 2023. The geographic mix of subscription services revenues was 59% from North America, 28% from Europe, and 13% from other locations, primarily Asia Pacific, for the three months ended April 30, 2024, as compared to 59% from North America, 26% from Europe, and 15% from other locations, primarily Asia Pacific, for the three months ended April 30, 2023.

Professional services and other revenues for the three months ended April 30, 2024 increased $5 million. The increase was primarily driven by increased demand for our business consulting services. The geographic mix of professional services and other revenues was 59% from North America, 35% from Europe, and 6% from other locations, primarily Asia Pacific, for the three months ended April 30, 2024, as compared to 62% from North America, 31% from Europe, and 7% from other locations, primarily Asia Pacific, for the three months ended April 30, 2023.

Cost of Revenue and Gross Margin

			Three months ended April 30,
			2024						2023						% Change
			(dollars in thousands)
Cost of revenues:
Cost of subscription services			$	78,148					$	67,575					16%
Cost of professional services and other			95,736						99,088						(3)%
Total cost of revenues			$	173,884					$	166,663					4%
Gross margin percentage:
Subscription services			85		%				84		%
Professional services and other			18		%				11		%
Total gross margin percentage			73		%				68		%
Gross profit			$	476,461					$	359,662					32%

Cost of revenues for the three months ended April 30, 2024 increased $7 million, of which $11 million was related to an increase in cost of subscription services, offset by an immaterial decrease in professional services and other due to a reduction in the use of third-party services to support our professional services revenue. The increase in cost of subscription services was primarily due to an increase of $6 million related to computing infrastructure costs, which was driven by an increase in both the number of end users and the volume of activity by end users of our subscription services.

We expect cost of subscription services to increase in absolute dollars in the near term due to increased usage of our subscription services and increased data costs related to our data solutions.

Veeva Systems Inc. | Form 10-Q			25

Operating Expenses and Operating Margin

Operating expenses include research and development, sales and marketing, and general and administrative expenses. We expect operating expenses to increase in the fiscal year ending January 31, 2025, primarily due to employee compensation-related costs.

Research and Development

			Three months ended April 30,
			2024						2023						% Change
			(dollars in thousands)
Research and development			$	162,711					$	146,960					11%
Percentage of total revenues			25		%				28		%

Research and development expenses for the three months ended April 30, 2024 increased $16 million, primarily due to an increase in employee compensation-related costs. The increase in employee compensation-related costs was primarily driven by an increase in headcount during the period. The expansion of our headcount in research and development was to support development work for the products that we offer or may offer in the future.

We expect research and development expenses to increase in the fiscal year ending January 31, 2025, primarily due to employee compensation-related costs as we continue to invest in our product offerings.

Sales and Marketing

			Three months ended April 30,
			2024						2023						% Change
			(dollars in thousands)
Sales and marketing			$	97,301					$	88,503					10%
Percentage of total revenues			15		%				17		%

Sales and marketing expenses for the three months ended April 30, 2024 increased $9 million, primarily due to an increase of $7 million in employee compensation-related costs. The increase in employee compensation-related costs was primarily driven by the increase in headcount during the period to support our sales and marketing efforts associated with our product offerings.

We expect sales and marketing expenses to increase in the fiscal year ending January 31, 2025, primarily due to employee compensation-related costs and the increase in marketing program costs related to events.

General and Administrative

			Three months ended April 30,
			2024						2023						% Change
			(dollars in thousands)
General and administrative			$	61,277					$	62,669					(2)%
Percentage of total revenues			9		%				12		%

General and administrative expenses for the three months ended April 30, 2024 remained relatively consistent due to lower payroll taxes offset by a litigation settlement accrual.

We expect general and administrative expenses to be relatively consistent in the fiscal year ending January 31, 2025 when compared to the fiscal year ended January 31, 2024.

26			Veeva Systems Inc. | Form 10-Q

Other Income, Net

			Three months ended April 30,
			2024						2023						% Change
			(dollars in thousands)
Other income, net			$	51,729					$	30,248					71%

Other income, net, for the three months ended April 30, 2024 increased $21 million, due to an increase in interest income from higher investment asset balances as well as increases in interest rates within our short-term investment portfolio.

Foreign Currency

We continue to experience fluctuations primarily resulting from the periodic re-measurement of the foreign currencies exposures on the balance sheet. The results of operations and cash flows are also subject to fluctuations in foreign currency exchange rates, particularly in the Euro, Japanese Yen, Canadian Dollar, Great British Pound Sterling, and Chinese Yuan.

Provision for Income Taxes

			Three months ended April 30,
			2024						2023						% Change
			(dollars in thousands)
Income before income taxes			$	206,901					$	91,778					125%
Income tax provision (benefit)			$	45,237					$	(39,743)					(214)%
Effective tax rate			21.9		%				(43.3)		%

The provision for income taxes differs from the tax computed at the U.S. federal statutory income tax rate primarily due to state taxes, tax credits, equity compensation, and foreign income subject to taxation in the United States. Future tax rates could be affected by changes in tax laws and regulations or by rulings in tax related litigation, as may be applicable.

For the three months ended April 30, 2024 and 2023, our effective tax rates were 21.9% and (43.3)%, respectively. During the three months ended April 30, 2024, as compared to the same period in the prior fiscal year, our effective tax rate increased primarily due to the reduced benefit from excess tax benefits related to equity compensation.

Non-GAAP Financial Measures

In our public disclosures, we have provided non-GAAP measures, which we define as financial information that has not been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. In addition to our GAAP measures, we use these non-GAAP financial measures internally for budgeting and resource allocation purposes and in analyzing our financial results.

For the reasons set forth below, we believe that excluding the following items provides information that is helpful in understanding our operating results, evaluating our future prospects, comparing our financial results across accounting periods, and comparing our financial results to our peers, many of which provide similar non-GAAP financial measures.

• Excess tax benefits. Excess tax benefits from employee stock plans are dependent on previously agreed-upon equity grants to our employees, vesting of those grants, stock price, and exercise behavior of our employees, which can fluctuate from quarter to quarter. Because these fluctuations are not directly related to our business operations, we exclude excess tax benefits for our internal management reporting processes. Our management also finds it useful to exclude excess tax benefits when assessing the level of cash provided by operating activities. Given the nature of the excess tax benefits, we believe excluding it allows investors to make meaningful comparisons between our operating cash flows from quarter to quarter and those of other companies.

Veeva Systems Inc. | Form 10-Q			27

• Stock-based compensation expenses. We exclude stock-based compensation expenses primarily because they are non-cash expenses that we exclude from our internal management reporting processes. We also find it useful to exclude these expenses when we assess the appropriate level of various operating expenses and resource allocations when budgeting, planning, and forecasting future periods. Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use, we believe excluding stock-based compensation expenses allows investors to make meaningful comparisons between our recurring core business operating results and those of other companies.

• Amortization of purchased intangibles. We incur amortization expense for purchased intangible assets in connection with acquisitions of certain businesses and technologies. Amortization of intangible assets is a non-cash expense and is inconsistent in amount and frequency because it is significantly affected by the timing, size of acquisitions, and the inherent subjective nature of purchase price allocations. Because these costs have already been incurred and cannot be recovered, and are non-cash expenses, we exclude these expenses for internal management reporting processes. We also find it useful to exclude these charges when assessing the appropriate level of various operating expenses and resource allocations when budgeting, planning, and forecasting future periods. Investors should note that the use of intangible assets contributed to our revenues earned during the periods presented and will contribute to our future period revenues as well.

• Litigation settlement. We exclude costs related to the settlement of certain litigation matters because they are non-recurring and outside the ordinary course of business. Because these costs are unrelated to our day-to-day business operations, we believe excluding them enables more consistent evaluation of our operating results.

• Income tax effects on the difference between GAAP and non-GAAP costs and expenses. The income tax effects that are excluded relate to the imputed tax impact on the difference between GAAP and non-GAAP costs and expenses due to stock-based compensation and purchased intangibles for GAAP and non-GAAP measures.

Limitations on the Use of Non-GAAP Financial Measures

There are limitations to using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures provided by other companies.

The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which items are adjusted to calculate our non-GAAP financial measures. We compensate for these limitations by analyzing current and future results on a GAAP basis as well as a non-GAAP basis and also by providing GAAP measures in our public disclosures.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure to evaluate our business, and to view our non-GAAP financial measures in conjunction with the most directly comparable GAAP financial measures.

28			Veeva Systems Inc. | Form 10-Q

The following table reconciles the specific items excluded from GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:

			Three months ended April 30,
			2024						2023
			(in thousands)
Net cash provided by operating activities on a GAAP basis			$	763,516					$	505,936
Excess tax benefits from employee stock plans			(3,121)						(62,089)
Net cash provided by operating activities on a non-GAAP basis			$	760,395					$	443,847
Net cash used in investing activities on a GAAP basis			$	(272,378)					$	(297,394)
Net cash provided by (used in) financing activities on a GAAP basis			$	3,828					$	(1,392)
Operating income on a GAAP basis			$	155,172					$	61,530
Stock-based compensation expense			95,911						90,719
Amortization of purchased intangibles			4,785						4,746
Litigation settlement			5,000						—
Operating income on a non-GAAP basis			$	260,868					$	156,995
Net income on a GAAP basis			$	161,664					$	131,521
Stock-based compensation expense			95,911						90,719
Amortization of purchased intangibles			4,785						4,746
Litigation settlement			5,000						—
Income tax effect on non-GAAP adjustments(1)			(20,408)						(79,064)
Net income on a non-GAAP basis			$	246,952					$	147,922
Diluted net income per share on a GAAP basis			$	0.98					$	0.81
Stock-based compensation expense			0.58						0.56
Amortization of purchased intangibles			0.03						0.03
Litigation settlement			0.03						—
Income tax effect on non-GAAP adjustments(1)			(0.12)						(0.49)
Diluted net income per share on a non-GAAP basis			$	1.50					$	0.91
(1) For the three months ended April 30, 2024 and 2023, we used an estimated annual effective non-GAAP tax rate of 21%.

Liquidity and Capital Resources

			Three months ended April 30,
			2024						2023
			(in thousands)
Net cash provided by operating activities			$	763,516					$	505,936
Net cash used in investing activities			(272,378)						(297,394)
Net cash provided by (used in) financing activities			3,828						(1,392)
Effect of exchange rate changes on cash and cash equivalents			(1,257)						19
Net change in cash and cash equivalents			$	493,709					$	207,169

Our principal sources of liquidity continue to be comprised of our existing cash, cash equivalents, and short-term investments, as well as cash flows generated from our operations. As of April 30, 2024, our cash, cash equivalents, and short-term investments totaled $4.8 billion, of which $85 million represented cash and cash equivalents held outside of the United States.

Our primary use of cash is payment of our operating costs, which consist primarily of employee-related expenses, such as compensation and benefits, investments in our information technology infrastructure, and general operating expenses for marketing, facilities, and overhead costs. Long-term cash requirements for items other than normal operating expenses could include the following: the acquisition of businesses, software products, or technologies complementary to our business, and capital expenditures.

Our non-U.S. cash and cash equivalents are not considered indefinitely reinvested outside the United States, except in certain designated jurisdictions. As of April 30, 2024, we have not recorded any taxes, such as withholding

Veeva Systems Inc. | Form 10-Q			29

taxes, associated with the foreign earnings that are indefinitely reinvested outside of the United States. Under currently enacted tax laws, if we were to choose to repatriate the funds we have designated as indefinitely reinvested outside the United States, such amounts may be subject to certain jurisdictional taxes (e.g., withholding taxes).

We have financed our operations primarily through cash generated from operations. We believe our existing cash, cash equivalents, and short-term investments generated from operations will be sufficient to meet our working capital and capital expenditure needs over at least the next 12 months. Our cash deposits are primarily held at financial institutions classified as global systemically important banks, and we maintain sufficient cash at more than one financial institution to meet our operational needs. Our future capital requirements will depend on many factors including our growth rate, subscription renewal activity, the timing and extent of spending to support product development efforts, the expansion of sales and marketing activities, the ongoing investments in technology infrastructure, the introduction of new and enhanced solutions, and the continuing market acceptance of our solutions. We may in the future enter into arrangements to acquire or invest in complementary businesses, services and technologies, and intellectual property rights. We may be required to seek additional equity or debt financing for those arrangements or for other reasons. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, our business, operating results, and financial condition would be adversely affected.

Operating Activities

Our largest source of operating cash inflows is cash collections from our customers for subscription services. We also generate significant cash flows from our professional services arrangements. The first quarter of our fiscal year is seasonally the strongest quarter for cash inflows due to the timing of our annual subscription billings and related collections. Our primary uses of cash from operating activities are for employee-related expenditures, expenses related to our computing infrastructure (including Amazon Web Services and Salesforce, Inc.), building infrastructure costs (including leases for office space), fees for third-party legal counsel and accounting services, and data acquisition costs. Note that our net income reflects the impact of excess tax benefits related to equity compensation.

Net cash provided by operating activities was $764 million for the three months ended April 30, 2024 compared to $506 million provided by operating activities for the three months ended April 30, 2023. The $258 million increase was primarily due to increased sales and the related cash collections, partially offset by larger operating expenses due to increases in headcount.

The cash flows from operating activities for the three months ended April 30, 2024 represent a significant portion of the cash flows from operating activities that we expect during our fiscal year ending January 31, 2025. As a result, we expect cash flows from operating activities to be substantially less in future quarterly periods of this fiscal year. In the fiscal year ending January 31, 2025, cash payments for income taxes in relation to the Tax Cuts and Jobs Act of 2017, which eliminated the option to deduct research and development expenditures and required taxpayers to capitalize and amortize them over five or fifteen years, are expected to reduce our cash flows from operating activities. The requirement may also impact our cash flows from operating activities in future periods, the amounts and specific periods of which we are unable to estimate at this time.

Investing Activities

Investing activities primarily relate to cash used for the purchase of marketable securities, net of maturities. We also use cash to invest in capital assets to support our growth.

Net cash used in investing activities was $272 million for the three months ended April 30, 2024 compared to $297 million used in investing activities for the three months ended April 30, 2023. The $25 million decrease in cash used in investing activities was mainly due to the increase in proceeds from maturities and sales of short-term investments partially offset by the increase in purchases of short-term investments for the three months ended April 30, 2024.

30			Veeva Systems Inc. | Form 10-Q

Financing Activities

The cash flows from financing activities relate primarily to stock option exercises offset by taxes paid on behalf of employees related to the net share settlement of RSUs.

Net cash provided by financing activities was $4 million for the three months ended April 30, 2024 compared to $1 million used in financing activities for the three months ended April 30, 2023. The $5 million increase was primarily related to an increase of $13 million in proceeds from employee stock option exercises, partially offset by an increase of $8 million of cash used to pay employee taxes related to the net share settlement of RSUs.

Critical Accounting Policies and Estimates

Our condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States (GAAP). In the preparation of these condensed consolidated financial statements, we are required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs, and expenses and related disclosures. On an ongoing basis, we evaluate our estimates and assumptions. Our actual results may differ from these estimates under different assumptions or conditions.

There have been no material changes to our critical accounting policies and estimates during the three months ended April 30, 2024 as compared to the those disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2024.

Veeva Systems Inc. | Form 10-Q			31

Foreign currency exchange risk

Our results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the Euro, Japanese Yen, Canadian Dollar, British Pound Sterling, and Chinese Yuan, and may be adversely affected in the future due to changes in foreign currency exchange rates. For the three months ended April 30, 2024, about 83% of our revenues and about 80% of our expenses were denominated in USD.

We have also experienced and will continue to experience foreign currency fluctuations due to the periodic re-measurement of monetary account balances that are denominated in currencies other than the functional currency of the entities in which they are recorded and such fluctuations can impact our net income. We engage in the hedging of our foreign currency transactions as described in note 7 of the notes to our condensed consolidated financial statements and may, in the future, hedge selected significant transactions or net monetary exposure positions denominated in currencies other than the U.S. dollar. Realized and unrealized foreign currency losses were immaterial for both the three months ended April 30, 2024, and 2023.

Interest rate sensitivity

We had cash, cash equivalents and short-term investments totaling $4.8 billion as of April 30, 2024. This amount was held primarily in demand deposit accounts, money market funds, U.S. treasury securities and agency obligations, corporate notes and bonds, asset-backed securities, commercial paper, and foreign government bonds. The cash and cash equivalents are held for working capital purposes and other operational activities. We do not enter into investments for trading or speculative purposes.

Our cash equivalents and our portfolio of marketable securities are subject to market risk due to changes in interest rates, which could affect our results of operations. Fixed rate securities may have their market value adversely affected due to a rise in interest rates, while floating rate securities may produce less income than expected if interest rates fall. Due in part to these factors, our future investment income may fluctuate due to changes in interest rates or we may suffer losses in principal if we are forced to sell securities that decline in market value due to changes in interest rates. However, because we classify our marketable securities as “available for sale,” no gains or losses are recognized due to changes in interest rates unless such securities are sold prior to maturity or declines in fair value are determined to be other-than-temporary. Our fixed-income portfolio is subject to interest rate risk.

An immediate increase of 100-basis points in interest rates would have resulted in a $45 million market value reduction in our investment portfolio as of April 30, 2024. An immediate decrease of 100-basis points in interest rates would have increased the market value by $45 million as of April 30, 2024. This estimate is based on a sensitivity model that measures market value changes when changes in interest rates occur. Fluctuations in the value of our investment securities caused by a change in interest rates (gains or losses on the carrying value) are recorded in other comprehensive income, and are realized only if we sell the underlying securities.

32			Veeva Systems Inc. | Form 10-Q

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of April 30, 2024. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (Exchange Act), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the Securities and Exchange Commission’s (SEC) rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure.

Based on our management’s evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of April 30, 2024, our disclosure controls and procedures were designed at a reasonable assurance level and were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the fiscal quarter ended April 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our disclosure controls or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been or would be detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Veeva Systems Inc. | Form 10-Q			33

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

From time to time, we may be involved in legal proceedings and subject to claims incident to the ordinary course of business. For information regarding certain current legal proceedings, see note 13 of the notes to our condensed consolidated financial statements, which is incorporated herein by reference. In addition to the legal proceedings referenced in note 13, we are involved in the following additional legal proceedings which may be material to our business.

California Non-Compete Matter

On July 17, 2017, we filed a complaint in the Superior Court of the State of California in the County of Alameda against Medidata, IQVIA, and Sparta Systems, Inc. (Veeva Systems Inc. v. Medidata Solutions, Inc., Quintiles IMS Incorporated, IMS Software Services, LTD., and Sparta Systems, Inc., Case No. RG17868081). Our lawsuit seeks declaratory and injunctive relief concerning the use of non-compete, confidentiality, and non-disparagement agreements by these companies. Since the original complaint was filed, there has been extensive requests to the court for rulings on contested questions.

On February 13, 2023, Veeva and Sparta entered into a confidential settlement agreement dismissing their claims against each other. On January 16, 2024, Veeva and Medidata also entered into a confidential settlement agreement dismissing their claims against each other. On June 9, 2023, IQVIA, the only defendant now in the case, filed a counter-complaint seeking a declaration that its non-compete agreements comply with California law. On March 25, 2024, the trial court judge set a trial date of June 13, 2025 on the consolidated claims.

Although the results of legal proceedings and claims cannot be predicted with certainty, we believe we are not currently a party to any other legal proceedings, the outcome of which, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, cash flows, or financial position. Regardless of the outcome, such proceedings can have an adverse impact on us because of defense and settlement costs, diversion of resources and other factors, and there can be no assurances that favorable outcomes will be obtained.

34			Veeva Systems Inc. | Form 10-Q

Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described below and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” together with all of the other information in this report, including our condensed consolidated financial statements and related notes, before investing in our common stock. The risks and uncertainties described below are not the only ones we face. If any of the following risks actually occurs, our business, financial condition, results of operations, and prospects could be materially and adversely affected. In that event, the price of our common stock could decline and you could lose part or all of your investment.

Summary of Risk Factors

The below is a summary of principal risks to our business and risks associated with ownership of our stock. It is only a summary. You should read the more detailed discussion of risks set forth below and elsewhere in this report for a more complete discussion of the risks listed below and other risks.

• If our security measures are breached or unauthorized access to customer data is otherwise obtained, our solutions may be perceived as not being secure, customers may reduce or stop the use of our solutions, and we may incur significant liabilities.

• The markets in which we participate are highly competitive, and if we do not compete effectively, our business and operating results could be adversely affected.

• If our newer solutions are not successfully adopted by new and existing customers, the growth rate of our revenues and operating results will be adversely affected.

• Our revenues are relatively concentrated within a small number of key customers, and the loss of one or more of such key customers could cause our revenues to decline.

• Defects or disruptions in our solutions could result in diminished demand for our solutions, a reduction in our revenues, and subject us to substantial liability.

• Our plans to migrate our customers to our Vault CRM applications built on our own Veeva Vault platform could cause business disruptions for customers, lead to the loss of our customers to competitors, and adversely affect our operating results.

• Nearly all of our revenues are generated by sales to customers in the life sciences industry, and factors that adversely affect this industry could also adversely affect us.

• Over the longer term our revenue growth rates are likely to fluctuate from year to year and may decline, and, as our costs increase, we may not be able to sustain the same level of profitability we have achieved in the past.

• Unique and uncertain macroeconomic and geopolitical factors, including as a result of worldwide inflationary pressures and changes in interest rates, currency exchange fluctuations, the Russian invasion of Ukraine, and the Israel-Hamas conflict, and concerns about a possible domestic or global recession, may cause instability and volatility in the global financial markets and disruptions within the life sciences industry that may negatively impact our business, our financial results, and our stock price.

• Difficulty attracting and retaining highly skilled employees could adversely affect our business and efforts to attract and retain such employees may increase our expenses.

• If the third-party providers of healthcare professional and healthcare organization data and prescription drug sales data, such as IQVIA for instance, do not allow our customers to upload and use such data in our solutions, the demand for our solutions may decrease, and our business may be negatively impacted.

• We rely on third-party providers for computing infrastructure, secure network connectivity, and other technology-related services needed to deliver our cloud solutions, and any slowdown, failure, or disruption in the services provided by them could adversely affect our business and subject us to liability.

• Changing laws and regulations, including increasingly complex data privacy and information security regulations, in the U.S. and internationally, life sciences industry regulations, and trade policies, may impose additional costs for compliance, reduce demand for our solutions, and subject us to significant liabilities.

Veeva Systems Inc. | Form 10-Q			35

• We are currently being sued by third parties for alleged misappropriation of trade secrets. We may suffer damages, which could be significant, or other harm from these lawsuits and we may be sued for infringement or misappropriation of third-party intellectual property in the future.

• We may acquire other companies or technologies, which could divert our management’s attention, result in additional dilution to our stockholders, and otherwise disrupt our operations and adversely affect our operating results.

Risks Related to Our Business

If our security measures are breached or compromised or unauthorized access to customer data is otherwise obtained, our solutions may be perceived as not being secure, customers may reduce or stop their use of our solutions, and we may incur significant liabilities.

Our solutions involve the storage, transmission, and other processing of our customers’ proprietary information (including personal or identifying information regarding their employees and the medical professionals whom their sales personnel contact, and sensitive proprietary data related to the clinical trial, regulatory submission and sales and marketing processes for medical treatments), personal information of medical professionals, personal information (which may include personal health information) of patients and clinical trial participants, and other sensitive information. For example, Veeva Crossix and Veeva Compass process third-party health and non-health data for U.S. patients. Additionally, we maintain and process other confidential, proprietary, and sensitive business information, including personal information relating to our employees and contractors and confidential information relating to our solutions and business.

Unauthorized access or other security breaches or incidents, as a result of third-party action (e.g., cyber-attacks, or the introduction into our networks or systems of ransomware or other malware), employee or contractor error or malfeasance, product defect, or otherwise, have resulted in and could in the future result in the loss of information or intellectual property, inappropriate access to or use, disclosure, unavailability, modification, destruction, or other processing of information, service interruption, degradation, disruption, and outages, service level credits, claims, demands, litigation, regulatory investigations and other proceedings, indemnity obligations, damage to our reputation, and other liability. It is possible that our risk of cyber-attack and other sources of security breaches and incidents may be elevated as a result of Russia’s invasion of Ukraine, the Israel-Hamas conflict, or other geopolitical tensions or conflicts, due to an increase in cyber-attack attempts on us, our customers, our partners, or our technology infrastructure providers.

While we maintain and continue to improve our security measures, we may be unable to adequately anticipate security threats or to implement adequate preventative measures, in part, because the techniques used to obtain unauthorized access or sabotage systems change frequently and are becoming increasingly sophisticated and complex, and generally are not identified until they are launched against a target. Moreover, our efforts to detect, prevent, and remediate known or unknown security vulnerabilities, including those arising from third-party hardware or software in our supply chain, may be insufficient to prevent security breaches or incidents resulting from such vulnerabilities, and may result in additi

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Rule 10b5-1 Trading Plans

The following table sets forth the material terms of all “Rule 10b5-1 trading arrangements” (as such term is defined under Item 408(a) of Regulation S-K) adopted or terminated by our Section 16 officers and directors during the fiscal quarter ended April 30, 2024:

Name and Title			Action (Adoption / Termination)			Adoption / Termination Date			Aggregate Number of Shares of Common Stock to be Sold (1)			Expiration Date (2)
Alan Mateo Former Executive Vice President, Global Sales(3)			Adoption			3/20/2024			50,242			4/30/2025

(1) This number represents the maximum number of shares of common stock that may be sold pursuant to the trading plan. The number of shares actually sold will depend on the satisfaction of certain conditions as set forth in the plan.

(2) In each case, the trading plan may expire on an earlier date if and when all transactions thereunder are completed.

(3) As previously disclosed on our Current Report on Form 8-K filed on April 1, 2024, Mr. Mateo retired from his position as Executive Vice President, Global Sales and transitioned to a part-time advisor role, effective April 30, 2024.

None of our Section 16 officers or directors adopted or terminated a “non-Rule 10b5-1 trading arrangement” (as such term is defined under Item 408(c) of Regulation S-K) during the fiscal quarter ended April 30, 2024.

58			Veeva Systems Inc. | Form 10-Q

Exhibits

Exhibit Number						Exhibit Description						Incorporated by Reference																								Filed
			Form						File No.						Exhibit						Filing Date						Herewith
3.1						Amended and Restated Certificate of Incorporation of Veeva Systems Inc.						8-K						001-36121						3.2						10/16/2023
3.2						Certificate of Retirement of Class B Common Stock of Veeva Systems Inc.						8-K						001-36121						3.1						10/16/2023
3.3						Amended and Restated Bylaws of Veeva Systems Inc.						8-K						001-36121						3.1						6/23/2023
10.1*						Advisor Agreement, dated April 22, 2024, between Alan Mateo and Veeva Systems Inc.																														X
10.2*						Separation Agreement, dated April 4, 2024, between Brent Bowman and Veeva Systems Inc.																														X
10.3*						Offer Letter, dated February 29, 2024, between Stacey Epstein and Veeva Systems Inc.																														X
31.1						Certification of Principal Executive Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.																														X
31.2						Certification of Principal Financial Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.																														X
32.1†						Certification of Chief Executive Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350.																														X
32.2†						Certification of Chief Financial Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350.																														X
101.INS						Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH						Inline XBRL Taxonomy Schema Linkbase Document.

Veeva Systems Inc. | Form 10-Q			59

101.CAL						Inline XBRL Taxonomy Calculation Linkbase Document.
101.DEF						Inline XBRL Taxonomy Definition Linkbase Document.
101.LAB						Inline XBRL Taxonomy Labels Linkbase Document.
101.PRE						Inline XBRL Taxonomy Presentation Linkbase Document.
104						Cover Page Interactive Data File - the cover page interactive data is embedded within the Inline XBRL document or included within the Exhibit 101 attachments.

• Indicates a management contract or compensatory plan.

† The certifications attached as Exhibit 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of Veeva Systems Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.

60			Veeva Systems Inc. | Form 10-Q

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

						Veeva Systems Inc.
Dated:			June 3, 2024			By:			/s/ TIM CABRAL
									Tim Cabral Interim Chief Financial Officer (Principal Financial Officer)
Dated:			June 3, 2024			By:			/s/ KRISTINE DIAMOND
									Kristine Diamond Chief Accounting Officer (Principal Accounting Officer)

Veeva Systems Inc. | Form 10-Q			61