Item 1. FINANCIAL STATEMENTS.

81K characters. Original on sec.gov · Markdown

Item 1. FINANCIAL STATEMENTS.

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

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

(Unaudited)


	July 31, 2025		January 31, 2025

Assets
Current assets:
Cash and cash equivalents	$	1,930,431	$	1,118,785
Short-term investments	4,473,282		4,031,442
Accounts receivable, net of allowance for credit losses of $602 and $57, respectively	422,071		1,016,356
Unbilled accounts receivable	50,348		40,761
Prepaid expenses and other current assets	118,456		101,458
Total current assets	6,994,588		6,308,802
Property and equipment, net	61,210		55,912
Deferred costs, net	25,899		26,383
Lease right-of-use assets	71,538		63,863
Goodwill	439,877		439,877
Intangible assets, net	36,445		44,460
Deferred income taxes	309,639		343,919
Other long-term assets	60,231		56,540
Total assets	$	7,999,427	$	7,339,756
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	33,578	$	30,447
Accrued compensation and benefits	40,647		39,429
Accrued expenses and other current liabilities	58,807		35,557
Income tax payable	3,662		9,024
Deferred revenue	1,107,696		1,273,978
Lease liabilities	10,663		9,969
Total current liabilities	1,255,053		1,398,404
Deferred income taxes	439		587
Long-term lease liabilities	74,785		65,806
Other long-term liabilities	30,611		42,586
Total liabilities	1,360,888		1,507,383
Commitments and contingencies (note 11)
Stockholders’ equity:
Common stock	2		2
Additional paid-in capital	2,757,440		2,386,192
Accumulated other comprehensive loss	(1,997)		(8,416)
Retained earnings	3,883,094		3,454,595
Total stockholders’ equity	6,638,539		5,832,373
Total liabilities and stockholders’ equity	$	7,999,427	$	7,339,756

See Notes to Condensed Consolidated Financial Statements.


4			Veeva Systems Inc. \| Form 10-Q

Table of Contents

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands, except per share data)

(Unaudited)


	Three months ended July 31,				Six months ended July 31,
	2025		2024		2025		2024


Revenues:
Subscription services	$	659,183	$	561,277	$	1,293,951	$	1,095,232
Professional services and other	129,898		114,904		254,173		231,294
Total revenues	789,081		676,181		1,548,124		1,326,526
Cost of revenues (1):
Cost of subscription services	93,830		78,791		172,176		156,939
Cost of professional services and other	101,423		91,581		196,901		187,317
Total cost of revenues	195,253		170,372		369,077		344,256
Gross profit	593,828		505,809		1,179,047		982,270
Operating expenses (1):
Research and development	192,677		176,429		376,710		339,140
Sales and marketing	109,439		101,528		208,067		198,829
General and administrative	95,804		61,365		164,630		122,642
Total operating expenses	397,920		339,322		749,407		660,611
Operating income	195,908		166,487		429,640		321,659
Other income, net	69,456		58,573		134,545		110,302
Income before income taxes	265,364		225,060		564,185		431,961
Income tax provision	65,055		54,019		135,686		99,256
Net income	$	200,309	$	171,041	$	428,499	$	332,705
Net income per share:
Basic	$	1.23	$	1.06	$	2.63	$	2.06
Diluted	$	1.19	$	1.04	$	2.56	$	2.02
Weighted-average shares used to compute net income per share:
Basic	163,496		161,708		163,129		161,566
Diluted	167,685		164,564		167,272		164,497
Other comprehensive income:
Net change in unrealized (loss) gain on available-for-sale investments	$	(11,300)	$	25,175	$	6,067	$	6,314
Net change in cumulative foreign currency translation gain (loss)	390		(104)		352		(1,252)
Comprehensive income	$	189,399	$	196,112	$	434,918	$	337,767


(1) Includes stock-based compensation as follows:
Cost of revenues:
Cost of subscription services	$	1,941	$	1,642	$	3,656	$	3,196
Cost of professional services and other	14,804		13,176		27,573		25,711
Research and development	53,388		48,984		101,337		90,727
Sales and marketing	25,392		23,671		47,713		46,714
General and administrative	26,441		20,903		53,897		37,939
Total stock-based compensation	$	121,966	$	108,376	$	234,176	$	204,287

See Notes to Condensed Consolidated Financial Statements.


Veeva Systems Inc. \| Form 10-Q			5

Table of Contents

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share data)

(Unaudited)


	Three months ended July 31, 2025											Three months ended July 31, 2024
	Common stock			Additional paid-in capital		Retained earnings		Accumulated other comprehensive income (loss)		Total stockholders’ equity		Common stock			Additional paid-in capital		Retained earnings		Accumulated other comprehensive loss		Total stockholders’ equity
	Shares	Amount						Shares		Amount

Balances at beginning of period	162,975,081	$	2	$	2,519,398	$	3,682,785	$	8,913	$	6,211,098	161,624,611	$	2	$	2,017,904	$	2,902,121	$	(30,646)	$	4,889,381
Issuance of common stock upon exercise of stock options	741,812	—		141,692		—		—		141,692		48,813	—		6,400		—		—		6,400
Issuance of common stock upon vesting of restricted stock units	255,551	—		—		—		—		—		247,439	—		—		—		—		—
Shares withheld related to net share settlement	(94,750)	—		(26,373)		—		—		(26,373)		(90,576)	—		(16,630)		—		—		(16,630)
Stock-based compensation expense	—	—		122,723		—		—		122,723		—	—		109,435		—		—		109,435
Other comprehensive (loss) income	—	—		—		—		(10,910)		(10,910)		—	—		—		—		25,071		25,071
Net income	—	—		—		200,309		—		200,309		—	—		—		171,041		—		171,041
Balances at end of period	163,877,694	$	2	$	2,757,440	$	3,883,094	$	(1,997)	$	6,638,539	161,830,287	$	2	$	2,117,109	$	3,073,162	$	(5,575)	$	5,184,698


	Six months ended July 31, 2025											Six months ended July 31, 2024
	Common stock			Additional paid-in capital		Retained earnings		Accumulated other comprehensive loss		Total stockholders’ equity		Common stock			Additional paid-in capital		Retained earnings		Accumulated other comprehensive loss		Total stockholders’ equity
	Shares	Amount						Shares		Amount

Balances at beginning of period	162,583,789	$	2	$	2,386,192	$	3,454,595	$	(8,416)	$	5,832,373	161,260,172	$	2	$	1,915,002	$	2,740,457	$	(10,637)	$	4,644,824
Issuance of common stock upon exercise of stock options	984,525	—		182,297		—		—		182,297		227,590	—		34,834		—		—		34,834
Issuance of common stock upon vesting of restricted stock units	493,507	—		—		—		—		—		542,482	—		—		—		—		—
Shares withheld related to net share settlement	(184,127)	—		(46,783)		—		—		(46,783)		(199,957)	—		(41,588)		—		—		(41,588)
Stock-based compensation expense	—	—		235,734		—		—		235,734		—	—		208,861		—		—		208,861
Other comprehensive income	—	—		—		—		6,419		6,419		—	—		—		—		5,062		5,062
Net income	—	—		—		428,499		—		428,499		—	—		—		332,705		—		332,705
Balances at end of period	163,877,694	$	2	$	2,757,440	$	3,883,094	$	(1,997)	$	6,638,539	161,830,287	$	2	$	2,117,109	$	3,073,162	$	(5,575)	$	5,184,698

See Notes to Condensed Consolidated Financial Statements.


6			Veeva Systems Inc. \| Form 10-Q

Table of Contents

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	Six months ended July 31,
		2025			2024

Cash flows from operating activities
Net income			$	428,499		$	332,705
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			19,948			19,519
Reduction of lease right-of-use assets			6,316			5,508
Accretion of discount on short-term investments			(4,535)			(14,254)
Stock-based compensation			234,176			204,287
Amortization of deferred costs			8,205			7,651
Deferred income taxes			31,699			(59,801)
Other, net			(1,414)			127
Changes in operating assets and liabilities:
Accounts receivable			593,032			487,219
Unbilled accounts receivable			(9,587)			(3,067)
Deferred costs			(7,721)			(7,174)
Prepaid expenses and other current and long-term assets			(21,232)			4,344
Accounts payable			3,361			(3,343)
Accrued expenses and other current liabilities			23,763			(5,517)
Income tax payable			(5,362)			(6,246)
Deferred revenue			(180,888)			(103,652)
Lease liabilities			(5,300)			(4,666)
Other long-term liabilities			2,631			2,750
Net cash provided by operating activities			1,115,591			856,390
Cash flows from investing activities
Purchases of short-term investments			(1,452,857)			(1,392,297)
Maturities and sales of short-term investments			1,023,691			1,017,605
Long-term assets			(12,213)			(11,528)
Net cash used in investing activities			(441,379)			(386,220)
Cash flows from financing activities
Proceeds from exercise of common stock options			182,297			34,834
Taxes paid related to net share settlement of equity awards			(46,228)			(42,490)
Net cash provided by (used in) financing activities			136,069			(7,656)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash			1,365			(1,252)
Net change in cash, cash equivalents, and restricted cash			811,646			461,262
Cash, cash equivalents, and restricted cash at beginning of period			1,120,963			706,670
Cash, cash equivalents, and restricted cash at end of period			$	1,932,609		$	1,167,932

Cash, cash equivalents, and restricted cash at end of period:
Cash and cash equivalents			$	1,930,431		$	1,165,754
Restricted cash included in other long-term assets			2,178			2,178
Total cash, cash equivalents, and restricted cash at end of period			$	1,932,609		$	1,167,932

Supplemental disclosures of other cash flow information:
Cash paid for income taxes, net of refunds			$	126,683		$	162,760
Excess tax benefits from employee stock plans			$	15,610		$	4,262

See Notes to Condensed Consolidated Financial Statements.


Veeva Systems Inc. \| Form 10-Q			7

Table of Contents

VEEVA SYSTEMS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Summary of Business and Significant Accounting Policies

Description of Business

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. Our Commercial Solutions help life sciences companies achieve better, more intelligent engagement with healthcare professionals and healthcare organizations across multiple communication channels, and plan and execute more effective media and marketing campaigns. Our R&D Solutions for the clinical, regulatory, quality, and safety functions help life sciences companies streamline their end-to-end product development and quality and manufacturing processes to increase operational efficiency and maintain regulatory compliance throughout the product life cycle. Our solutions for clinical research sites enable regulatory documents and trial information to be managed in a modern cloud solution that is intended to accelerate the clinical research process for the life sciences industry overall. Our fiscal year end is January 31.

Principles of Consolidation and Basis of Presentation

These unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP) and applicable rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting and include the accounts of our wholly-owned subsidiaries after elimination of intercompany balances and transactions. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025, filed on March 24, 2025. There have been no changes to our significant accounting policies described in the annual report that have had a material impact on our condensed consolidated financial statements and related notes.

The unaudited condensed consolidated balance sheet as of January 31, 2025 included herein was derived from the audited financial statements as of that date. These unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly our financial position, results of operations, comprehensive income, and cash flows for the interim periods but are not necessarily indicative of the results of operations to be anticipated for the full fiscal year ending January 31, 2026 or any other period.

New Accounting Pronouncements Issued and Not Yet Adopted

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregation of rate reconciliation categories and income taxes paid by jurisdiction, among other amendments. This new standard is effective for our fiscal year beginning on February 1, 2025 on a prospective basis. Retrospective application is permitted. The adoption of ASU 2023-09 will modify our disclosures but will not have an impact on our financial position or results of operations.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosure (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disclosure, in the notes to the financial statements, of additional information about certain costs and expenses for interim and annual reporting periods. This new standard is effective for our fiscal year beginning on February 1, 2027 and interim periods beginning on February 1, 2028 on a prospective basis. Retrospective application is permitted. We are currently evaluating this ASU to determine its impact on our disclosures.


8			Veeva Systems Inc. \| Form 10-Q

Table of Contents

Note 2. Short-Term Investments

As of July 31, 2025, short-term investments consisted of the following (in thousands):


	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value
Available-for-sale securities:
Certificates of deposit	$	20,116	$	—	$	(13)	$	20,103
Asset-backed securities	399,409		2,191		(99)		401,501
Commercial paper	23,848		—		(13)		23,835
Corporate notes and bonds	2,663,431		13,771		(1,989)		2,675,213
Foreign government bonds	213,628		935		(546)		214,017
Municipal securities	61,646		124		(31)		61,739
U.S. agency obligations	13,372		41		—		13,413
U.S. treasury securities	1,063,948		1,759		(2,246)		1,063,461
Total available-for-sale securities	$	4,459,398	$	18,821	$	(4,937)	$	4,473,282

As of January 31, 2025, short-term investments consisted of the following (in thousands):


	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value
Available-for-sale securities:
Certificates of deposit	$	64,045	$	69	$	(21)	$	64,093
Asset-backed securities	526,986		3,257		(232)		530,011
Commercial paper	74,468		108		(1)		74,575
Corporate notes and bonds	2,202,150		10,588		(5,782)		2,206,956
Foreign government bonds	176,684		442		(1,023)		176,103
Municipal securities	67,780		173		(122)		67,831
U.S. agency obligations	24,616		94		(1)		24,709
U.S. treasury securities	888,968		1,440		(3,244)		887,164
Total available-for-sale securities	$	4,025,697	$	16,171	$	(10,426)	$	4,031,442

The following table summarizes the estimated fair value of our short-term investments, designated as available-for-sale and classified by the contractual maturity date of the securities as of the dates shown (in thousands):



	July 31, 2025		January 31, 2025
Due in one year or less	$	930,144	$	1,066,558
Due in greater than one year	3,543,138		2,964,884
Total	$	4,473,282	$	4,031,442

We have not recorded an allowance for credit losses, as we believe any such losses would be immaterial based on the high credit quality of our investments. It is more likely than not we will hold such securities until maturity or a recovery of the cost basis.


Veeva Systems Inc. \| Form 10-Q			9

Table of Contents

The following table shows the fair values of available-for-sale securities which were in an unrealized loss position, aggregated by investment category, as of July 31, 2025 (in thousands):


	12 months or less				Greater than 12 months
	Fair value		Gross unrealized losses		Fair value		Gross unrealized losses
Certificates of deposit	$	20,103	$	(12)	$	—	$	—
Asset-backed securities	21,127		(17)		20,833		(83)
Commercial paper	23,835		(13)		—		—
Corporate notes and bonds	571,900		(1,977)		26,912		(12)
Foreign government bonds	85,833		(547)		—		—
Municipal securities	19,374		(31)		—		—
U.S. agency obligations	1,899		—		—		—
U.S. treasury securities	665,013		(2,245)		—		—
Total	$	1,409,084	$	(4,842)	$	47,745	$	(95)

The following table shows the fair values of available-for-sale securities which were in an unrealized loss position, aggregated by investment category, as of January 31, 2025 (in thousands):


	12 months or less				Greater than 12 months
	Fair value		Gross unrealized losses		Fair Value		Gross unrealized losses

Certificates of deposit	$	20,095	$	(21)	$	—	$	—
Asset-backed securities	25,220		(31)		44,789		(201)
Commercial paper	4,944		(1)		—		—
Corporate notes and bonds	616,379		(5,569)		71,331		(213)
Foreign government bonds	76,856		(1,023)		—		—
Municipal securities	22,593		(122)		—		—
U.S. agency obligations	1,865		(1)		—		—
U.S. treasury securities	439,382		(3,072)		173,071		(172)
Total	$	1,207,334	$	(9,840)	$	289,191	$	(586)

Note 3. Deferred Costs

Deferred costs, which consist of deferred sales commissions, were $26 million as of both July 31, 2025 and January 31, 2025. Amortization expense for the deferred costs included in sales and marketing expenses in the condensed consolidated statements of comprehensive income was $4 million and $8 million for the three and six months ended July 31, 2025, respectively, and $4 million and $8 million for the three and six months ended July 31, 2024, respectively. There have been no impairment losses recorded in relation to the costs capitalized for any period presented.

Note 4. Goodwill and Intangible Assets

Goodwill was $440 million as of both July 31, 2025 and January 31, 2025.

The following table presents the details of intangible assets as of July 31, 2025 (in thousands):


	Gross carrying amount		Accumulated amortization		Net
Existing technology	$	28,580	$	(26,973)	$	1,607
Customer relationships	113,157		(78,908)		34,249

Other intangibles	21,405		(20,816)		589
Total intangible assets	$	163,142	$	(126,697)	$	36,445


10			Veeva Systems Inc. \| Form 10-Q

Table of Contents

The following table presents the details of intangible assets as of January 31, 2025 (in thousands):


	Gross carrying amount		Accumulated amortization		Net
Existing technology	$	28,580	$	(24,878)	$	3,702
Customer relationships	113,157		(73,223)		39,934

Other intangibles	21,405		(20,581)		824
Total intangible assets	$	163,142	$	(118,682)	$	44,460

Amortization expense associated with intangible assets was $4 million and $8 million for the three and six months ended July 31, 2025, respectively, and $5 million and $10 million for the three and six months ended July 31, 2024, respectively.

As of July 31, 2025, the estimated future amortization expense for intangible assets is as follows (in thousands):


Fiscal Year	Estimated amortization expense
Remaining for 2026	$	6,131
2027	8,922
2028	7,778
2029	7,782
2030	5,832

Total	$	36,445

Note 5. Fair Value Measurements

The following table presents the fair value hierarchy for financial assets measured at fair value on a recurring basis as of July 31, 2025 (in thousands):


	Level 1		Level 2		Total
Assets
Cash equivalents:
Money market funds	$	897,086	$	—	$	897,086

U.S. Treasury securities	—		6,147		6,147



Short-term investments:
Certificates of deposit	—		20,103		20,103
Asset-backed securities	—		401,501		401,501
Commercial paper	—		23,835		23,835
Corporate notes and bonds	—		2,675,213		2,675,213
Foreign government bonds	—		214,017		214,017
Municipal securities	—		61,739		61,739
U.S. agency obligations	—		13,413		13,413
U.S. Treasury securities	—		1,063,461		1,063,461
Foreign currency derivative contracts	—		2,238		2,238
Total financial assets	$	897,086	$	4,481,667	$	5,378,753


Veeva Systems Inc. \| Form 10-Q			11

Table of Contents

The following table presents the fair value hierarchy for financial assets and liabilities measured at fair value on a recurring basis as of January 31, 2025 (in thousands):


	Level 1		Level 2		Total
Assets
Cash equivalents:
Money market funds	$	314,872	$	—	$	314,872
U.S. Treasury securities	—		3,301		3,301

Short-term investments:
Certificates of deposit	—		64,093		64,093
Asset-backed securities	—		530,011		530,011
Commercial paper	—		74,575		74,575
Corporate notes and bonds	—		2,206,956		2,206,956
Foreign government bonds	—		176,103		176,103
Municipal securities	—		67,831		67,831
U.S. agency obligations	—		24,709		24,709
U.S. Treasury securities	—		887,164		887,164
Foreign currency derivative contracts	—		96		96
Total financial assets	$	314,872	$	4,034,839	$	4,349,711
Liabilities
Foreign currency derivative contracts	$	—	$	(525)	$	(525)
Total financial liabilities	$	—	$	(525)	$	(525)

We determine the fair value of our security holdings based on pricing from our service providers and market prices from industry-standard independent data providers. The valuation techniques used to measure the fair value of financial instruments having Level 2 inputs were derived from non-binding consensus prices that are corroborated by observable market data or quoted market prices for similar instruments. Such market prices may be quoted prices in active markets for identical assets (Level 1 inputs) or pricing determined using inputs other than quoted prices that are observable either directly or indirectly (Level 2 inputs).

Balance Sheet Hedges

We enter into foreign currency forward contracts in order to hedge our foreign currency exposure. These forward contracts are not designated as hedging instruments under applicable accounting guidance, and therefore, we account for them at fair value with changes in the fair value recorded as a component of other income, net in our condensed consolidated statements of comprehensive income. Cash flows from such forward contracts are classified as operating activities.

For the six months ended July 31, 2025, net realized and unrealized foreign currency gains on hedging were $6 million. The net realized and unrealized foreign currency gains and losses on hedging were not material for the three months ended July 31, 2025 and for the three and six months ended July 31, 2024.

The fair value of our outstanding derivative instruments is summarized below (in thousands):



	July 31, 2025		January 31, 2025
Notional amount of foreign currency derivative contracts	$	96,119	$	130,122
Fair value of foreign currency derivative contracts	$	93,742	$	130,552

Note 6. Income Taxes

For the three months ended July 31, 2025 and 2024, our effective tax rates were 24.5% and 24.0%, respectively. For the six months ended July 31, 2025 and 2024, our effective tax rates were 24.0% and 23.0%, respectively. During the three and six months ended July 31, 2025, as compared to the same periods in the prior fiscal year, our effective tax rate increased primarily due to the indirect effects of the One Big Beautiful Bill Act (OBBBA), offset by increased excess tax benefits related to equity compensation.


12			Veeva Systems Inc. \| Form 10-Q

Table of Contents

Note 7. Deferred Revenue, Performance Obligations, and Unbilled Accounts Receivable

Deferred Revenue

Of the beginning deferred revenue balance for the respective periods, we recognized $556 million and $851 million in revenue for the three and six months ended July 31, 2025, respectively, and $466 million and $713 million for the three and six months ended July 31, 2024, respectively.

Transaction Price Allocated to the Remaining Performance Obligations

As of July 31, 2025, the amount of the transaction price allocated to remaining performance obligations for noncancellable subscription services contracts greater than one year was not significant with the substantial majority of such allocated transaction price included in deferred revenue and expected to be recognized over the next 12 months.

Unbilled Accounts Receivable

As of July 31, 2025, unbilled accounts receivable consisted of (i) receivables of $42 million primarily for revenue recognized for professional services performed but not yet billed and (ii) contract assets of $8 million primarily related to professional services performed but for which we are not contractually able to invoice until a future period.

As of January 31, 2025, unbilled accounts receivable consisted of (i) receivables of $33 million primarily for revenue recognized for professional services performed but not yet billed and (ii) contract assets of $8 million primarily related to professional services performed but for which we are not contractually able to invoice until a future period.

Note 8. Leases

We have operating leases for our corporate offices with various expiration dates, some of which include options to extend the leases for up to five years.

For the three months ended July 31, 2025 and 2024, our operating lease expense was $4 million and $3 million, respectively. For the six months ended July 31, 2025 and 2024, our operating lease expense was $8 million and $7 million, respectively.

Supplemental cash flow information related to leases was as follows (in thousands):


	Six months ended July 31,
	2025		2024
Cash paid for lease liabilities	$	6,992	$	5,885
Lease right-of-use assets obtained in exchange for new lease liabilities	$	14,015	$	2,509

Supplemental balance sheet information related to operating leases was as follows:



	July 31, 2025		January 31, 2025
Weighted average remaining lease term	7.6 years		7.7 years
Weighted average discount rate	4.7	%	4.6	%


Veeva Systems Inc. \| Form 10-Q			13

Table of Contents

As of July 31, 2025, remaining maturities of lease liabilities are as follows (in thousands):


Fiscal Year
Remaining for 2026	$	2,094
2027	15,350
2028	17,224
2029	13,391
2030	12,259
Thereafter	44,304
Total lease payments	104,622
Less imputed interest	(19,174)
Total lease liabilities	$	85,448

Note 9. Stockholders’ Equity

Common Stock

As of July 31, 2025, we had 163,877,694 shares of common stock outstanding.

Stock Option Activity

A summary of stock option activity for the six months ended July 31, 2025 is as follows:


	Number of shares	Weighted average exercise price		Weighted average remaining contractual term (in years)	Aggregate intrinsic value (in millions)
Options outstanding at January 31, 2025	14,633,921	$	177.65	6.8	$	860
Options granted	2,176,814	$	215.01
Options exercised	(984,525)	$	185.17
Options forfeited/cancelled	(187,369)	$	210.75
Options outstanding at July 31, 2025	15,638,841	$	181.98	6.8	$	1,600
Options vested and exercisable at July 31, 2025	6,862,373	$	138.67	4.5	$	1,000
Options vested and exercisable at July 31, 2025 and expected to vest thereafter	15,638,841	$	181.98	6.8	$	1,600

The options granted during the six months ended July 31, 2025 were primarily made in connection with our annual performance review cycle. The weighted average grant-date fair value of options granted was $122.04 and $97.28 per option for the three and six months ended July 31, 2025, respectively.

As of July 31, 2025, there was $541 million in unrecognized compensation cost related to unvested stock options granted under the 2013 Equity Incentive Plan. This cost is expected to be recognized over a weighted average period of 2.4 years.

The total intrinsic value of options exercised was approximately $64 million and $80 million for the three and six months ended July 31, 2025, respectively.


14			Veeva Systems Inc. \| Form 10-Q

Table of Contents

Stock Option Valuation Assumptions

The following table presents the weighted-average assumptions used to estimate the grant date fair value of options granted during the periods presented:


	Three months ended July 31,						Six months ended July 31,
	2025			2024			2025			2024
Volatility	39%	-	40%	39%			39%	-	40%	39%	-	41%
Expected term (in years)	6.25			6.25	-	7.63	6.25	-	7.00	6.25	-	7.63
Risk-free interest rate	4.02%	-	4.17%	4.15%	-	4.45%	3.78%	-	4.41%	4.12%	-	4.65%
Dividend yield	—%			—%			—%			—%

Restricted Stock Units

A summary of RSU activity for the six months ended July 31, 2025 is as follows:


	Unreleased restricted stock units	Weighted average grant date fair value
Balance at January 31, 2025	880,026	$	206.25
RSUs granted	1,016,695	$	215.98
RSUs vested	(493,507)	$	208.21
RSUs forfeited/cancelled	(31,447)	$	214.68
Balance at July 31, 2025	1,371,767	$	212.57

As of July 31, 2025, there was a total of $180 million in unrecognized compensation cost related to unvested RSUs. This cost is expected to be recognized over a weighted-average period of approximately 0.9 years. The total grant date fair value of RSUs vested for the three and six months ended July 31, 2025 was $71 million and $126 million, respectively.

Note 10. Net Income per Share

Basic net income per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period.

Diluted net income per share is computed by dividing net income by the weighted-average shares outstanding, including potentially dilutive shares of common equivalents outstanding during the period. The dilutive effect of potential shares of common stock are determined using the treasury stock method.

The following table presents the calculation of basic and diluted net income per share (in thousands, except per share data):


	Three months ended July 31,						Six months ended July 31,
2025			2024			2025			2024
Numerator:
Net income	$	200,309		$	171,041		$	428,499		$	332,705

Denominator:
Basic shares:
Weighted average common shares outstanding, basic	163,496			161,708			163,129			161,566
Diluted shares:
Weighted average common shares outstanding, basic	163,496			161,708			163,129			161,566

Effect of potentially dilutive common shares	4,189			2,856			4,143			2,931
Weighted average common shares outstanding, diluted	167,685			164,564			167,272			164,497
Net income per share:
Basic	$	1.23		$	1.06		$	2.63		$	2.06
Diluted	$	1.19		$	1.04		$	2.56		$	2.02


Veeva Systems Inc. \| Form 10-Q			15

Table of Contents

Potential common share equivalents excluded because their inclusion would be anti-dilutive are as follows (in thousands):


	Three months ended July 31,				Six months ended July 31,
2025		2024		2025		2024
Options and RSUs	7,298		9,076		6,746		7,887

Note 11. Commitments and Contingencies

Litigation

IQVIA Litigation Matters

IQVIA and Veeva have been involved in a series of litigations since 2017, including IQVIA Inc. v. Veeva Systems Inc. (No. 2:17-cv-00177) and IQVIA Inc. v. Veeva Systems Inc. (No. 2:19-cv-15517). In these litigations, IQVIA asserted trade secret misappropriation claims and Veeva asserted antitrust claims. Prior to August 13, 2025, these cases were pending in the U.S. District Court for the District of New Jersey.

On August 13, 2025, Veeva and IQVIA entered into a settlement agreement that resolves all ongoing litigations between Veeva and IQVIA. Under the terms of the settlement agreement, neither party will pay damages to the other party and both parties agreed to dismiss with prejudice all claims and counterclaims currently pending. Accordingly, all claims and counterclaims have now been dismissed.

Fee Arrangements Related to the IQVIA Litigation Matters. We entered into partial contingency fee arrangements with certain law firms representing us in the IQVIA litigations, pursuant to which such law firms are entitled to payment from us of a success fee if certain non-monetary outcomes are achieved. Consequent to the settlement of the IQVIA litigations, as of July 31, 2025, we accrued approximately $31 million due to such law firms in accordance with the terms of such arrangements.

Other Litigation Matters

From time to time, we may be involved in other legal proceedings and subject to claims incident to the ordinary course of business. Although the results of such 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.

Note 12. Segment Information

Operating segments are defined as components of an enterprise about which separate financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assessing performance. We define the term “chief operating decision maker” to be our Chief Executive Officer (CEO). Our CEO reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating our financial performance. Accordingly, the Company operates as a single operating and reportable segment that is focused on providing industry cloud solutions tailored to the global life sciences industry.

The CEO gauges the effectiveness of investment and resourcing decisions and trends in the overall efficiency of the business over time using multiple measures of performance, including consolidated net income and adjusted operating income, which is an additional measure of our segment profitability. The measure of segment assets is reported on the consolidated balance sheets as total assets.

The following table reconciles the Company’s revenues to consolidated net income and the specific items excluded from cost of revenues and operating expenses to calculate adjusted operating income (in thousands):


16			Veeva Systems Inc. \| Form 10-Q

Table of Contents


	Three months ended July 31,				Six months ended July 31,
	2025		2024		2025		2024
Revenues	$	789,081	$	676,181	$	1,548,124	$	1,326,526

Cost of revenues - adjusted:
Cost of subscription services revenues	90,843		76,026		166,462		151,521
Cost of professional services and other revenues	86,480		78,267		169,055		161,333
Operating expenses - adjusted:
Research and development	139,289		127,417		275,373		248,357
Sales and marketing	81,157		74,311		154,669		145,101
General and administrative	38,736		40,405		80,106		79,590
Operating income - adjusted	352,576		279,755		702,459		540,624
Other segment items (1)	156,668		113,268		272,819		218,965
Other income, net	69,456		58,573		134,545		110,302
Income tax provision	65,055		54,019		135,686		99,256
Consolidated net income	$	200,309	$	171,041	$	428,499	$	332,705
(1) Other segment items included in consolidated net income consist primarily of stock-based compensation, amortization of purchased intangibles, and litigation settlement-related charges.

Cost of revenues - adjusted, and operating expenses - adjusted, are segment expenses that are regularly provided to the CEO and do not include stock-based compensation, amortization of purchased intangibles, and litigation settlement-related charges, as we exclude them from our internal management reporting processes. We 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.

Note 13. Information about Geographic Areas and Products

Information about Geographic Areas

We track and allocate revenues by principal geographic area rather than by individual country, which makes it impractical to disclose revenues for the United States or other specific foreign countries. We measure subscription services revenue primarily by the estimated location of the end users in each geographic area for our Commercial Solutions and primarily by the estimated location of usage in each geographic area for our R&D Solutions. We measure professional services revenue primarily by the location of the resources performing the professional services.

Total revenues by geographic area were as follows for the periods shown below (in thousands):


	Three months ended July 31,				Six months ended July 31,
	2025		2024		2025		2024
Revenues by geography
North America	$	468,008	$	395,971	$	927,475	$	777,570
Europe	232,744		198,315		449,847		388,230
Asia Pacific	70,128		64,879		135,498		127,319
Middle East, Africa, and Latin America	18,201		17,016		35,304		33,407
Total revenues	$	789,081	$	676,181	$	1,548,124	$	1,326,526


Veeva Systems Inc. \| Form 10-Q			17

Table of Contents

Long-lived assets by geographic area are as follows as of the periods shown below (in thousands):



	July 31, 2025		January 31, 2025
Long-lived assets by geography
North America	$	49,221	$	47,144
Europe	7,586		6,778
Asia Pacific	3,776		1,295
Middle East, Africa, and Latin America	627		695
Total long-lived assets	$	61,210	$	55,912

Revenues by Product

We group our revenues into two product areas: Commercial Solutions and R&D Solutions. Commercial Solutions revenues consist of revenues from our Veeva Commercial Cloud and Veeva Data Cloud solutions. R&D Solutions revenues consist of revenues from our Veeva Development Cloud and Veeva Quality Cloud solutions.

Total revenues consist of the following (in thousands):


	Three months ended July 31,				Six months ended July 31,
	2025		2024		2025		2024
Subscription services
Commercial Solutions	$	307,523	$	271,810	$	612,934	$	533,126
R&D Solutions	351,660		289,467		681,017		562,106
Total subscription services	659,183		561,277		1,293,951		1,095,232
Professional services
Commercial Solutions	47,703		45,068		94,270		93,840
R&D Solutions	82,195		69,836		159,903		137,454
Total professional services	129,898		114,904		254,173		231,294
Total revenues	$	789,081	$	676,181	$	1,548,124	$	1,326,526


18			Veeva Systems Inc. \| Form 10-Q

Table of Contents

Previous: Cover and table of contents · Next: Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.