According to Accenture, the invasion of cloud technologies is revolutionizing the life sciences industry in three key ways – personalization; use of external innovation and data sources in the development of new products; and in leveraging a global operating model. Pleasanton, California-based Veeva (NYSE: VEEV), a Billion Dollar Unicorn player in this market, is witnessing robust growth and delivering stellar performance.
Veeva was initially set up to offer cloud-based customer relationship management and regulated content management solutions for the biotechnology industry. Today, its services help healthcare providers with access to payroll management, expense management, and customer relationship management services over the cloud. It offers drug sample tracking, electronic signature capture, and healthcare affiliations management along with content management capabilities such as content collection and organization, workflow, and approval processes.
Veeva recently announced its first quarter results that continued to impress the market. Revenues for the quarter grew 32% over the year to $157.9 million driven by a 33% increase in subscription revenues. For the quarter, subscription services revenues grew to $127.3 million. Revenues from professional services grew 29% to $30.64 million. Net income per share came in at $0.24, compared to $0.09 a year ago. The market was looking for revenues of $152.2 million with a net income of $0.22 per share.
For the current quarter, Veeva forecast revenues of $163-$164 million with an EPS of $0.20. The Street had forecast revenues of $160 million for the quarter with an EPS of $0.19. Veeva expects full-year revenues of $665-$669 million with an EPS of $0.82-$0.84 compared with earlier forecast of revenues of $655-$660 million with an EPS of $0.78-$0.80.
Veeva’s Product Expansion
Over the past few years, Veeva has been focused on product development. Veeva offers two key product suites – the Commercial Cloud and Veeva Vault. The Commercial Cloud offers customers with access to a wide range of services ranging from multi-channel planning and execution to complete customer insight and compliant content management. It offers ways to its customers to effectively engage with end users through preferred channels. It is seeing a strong adoption in the segment and during the quarter saw a great mix of enterprise customer expansions along with adoption by several new SMBs.
Its second big offering is the Veeva Vault. The cloud-based solution has been developed to meet the requirements of usability, scalability, performance, validation, and security. It allows IT teams and power users to rapidly modify existing applications or configure new cloud applications with simple point-and-click interface. It helps manage both content and data in a single platform. Vault has 14 core applications that can address every major area of a life sciences company including commercial, medical, clinical, quality, and regulatory requirements through a single cloud platform. Vault has seen a strong adoption since launch. The number of customers with multiple Vault products has increased more than 70% over the year.
To continue to grow its market, Veeva is focusing on clinical data management. During the recently ended quarter, it attained a development milestone with the first release of is Electronic Data Capture (EDC) offering. Veeve believes that clinical data management is a large market opportunity and it is well positioned to cater to it considering that customers are looking for a unified clinical suite that works together across clinical operations and clinical data management. Its current offerings are well integrated with EDC in a seamless way and on a common platform, giving them that added advantage.
Veeva had listed on the NYSE in 2013 by offering shares at $20 each at a valuation of $2.4 billion. The stock has done well since then. Today it is trading at $64.90 with a market capitalization of $9.05 billion. It has recovered from the 52-week low of $32.17 it had fallen to in June last year and had touched a year high of $67.86 earlier last month.
More investigation and analysis of Unicorn companies can be found in my latest Entrepreneur Journeys book, Billion Dollar Unicorns. The term Unicorn was coined in a TechCrunch article by Aileen Lee of Cowboy Ventures.