Veeva Systems, a provider of cloud solutions for life sciences businesses, (NYSE: VEEV) has been bulking up its subscription service for pharmaceutical companies, resulting in the highest revenue growth in the past nine quarters.
The software company reported subscription revenue grew by 16% due to a 15% increase from commercial growth and 20% rise from research and development growth to $766.8 million.
Revenue for Veeva increased by 18% to nearly $928 million, beating Wall Street analyst estimates of $905.4 million. The company reported a profit of $273.4 million, compared with a profit of $200.3 million in the same quarter a year ago.
For the current third quarter, Veeva anticipates revenue to reach between $932 million and $935 million while analysts estimate revenue of $918.1 million.
Veeva now estimates revenue of between $3.68 billion and $3.69 billion for the fiscal year, an increase from its prior projection of $3.64 billion to $3.65 billion.
Shares of Veeva Systems rose by 7% over the past year, but 39% year-to-date.
The addition of major pharmaceutical customers also boosted Veeva’s profit margin. The company’s customer relationship software, or CRM, attracted Eli Lilly (NYSE: LLY), Biogen (NASDAQ: BIIB) and Regeneron (NASDAQ: REGN), which “demonstrate customers’ continued reliance on and trust in Veeva,” wrote Keonhee Kim, an equity analyst for Morningstar. About 80% of global pharmaceutical sales representatives use Veeva’s CRM, up from about one-third in 2013.
“Development cloud also saw many new users adopt products across clinical, safety, and quality, demonstrating a continued need for Veeva’s products even in the age of AI,” he said.
The company also reported progress for early adopters of Veeva Falcon, an agentic labor that was announced last quarter.
“While it is still early for these products to contribute financially, we appreciate the continued momentum in Veeva’s AI solutions,” Kim said.
Veeva’s financial health is strong since the company carries no debt and produces “strong cash flow year over year to cover any potential debt or acquisitions in the future,” he said.
The company has a cash and equivalents balance of $1.4 billion as of the end of fiscal year 2026 and is anticipated to continue its trend of either having no or low amounts of debt and “deep pockets of cash to continue over the next five years,” he added.
Pharma companies increase AI spending
Biopharmaceutical companies have increased their spending over the past few months since advancements made by AI and science have shifted their goals, said CEO Peter Gassner during its earnings call.
AI has also played a role in the company’s growth, he said.
“AI is enabling the next big chapter for Veeva and the industry,” Gassner said. “We have software applications that work with our data and consulting that knows about our software and data. We have agents that work with our applications that are known by our consulting and that leverage our data. We’re building the industry cloud and the more our customers realize it, the more benefits they get because things fit together.”
One advantage that Veeva has is its “deeply embedded customer relationships” while the software company’s growing AI offerings “should help it compete in an increasingly crowded AI marketplace,” Kim said. “Customers may have many options, from large AI firms to smaller providers, but Veeva’s existing relationships and industry expertise make it an attractive choice for customers looking to adopt AI solutions.”
In May, the company announced an agentic platform called Falcon that will be used by biopharmaceutical companies to assist them in drug development. Veeva’s customers have already shown interest because it helps pharmaceutical firms save money and become more efficient while attaining compliance goals, Gassner added.
Falcon will be available to customers in November for trial master file document intake and quality control, health authority correspondence in regulatory, and safety case triage and intake.
“Interest in Falcon is very high,” he said. “It’s a structural advantage for Veeva to both have the agentic labor across multiple areas in life sciences and have the core applications across multiple of those areas in life sciences.”
CRM platform growing
In 2022, Veeva announced the launch of Vault CRM, the company’s cloud-based customer relationship management platform used by pharmaceutical and biotech companies. Vault CRM is a suite of applications that seeks to “help across specific functions (commercial, clinical, regulatory, quality and manufacturing, and safety) within any company that is developing drugs or suppliers to those who are developing drugs,” Kim wrote.
Veeva’s pharmaceutical customers began migrating in 2024 from the original version that was built on the Salesforce 1 platform. Major biopharma companies have made the switch and at the end of 2025, 10 of the top 20 biopharmas have committed to Vault CRM. In May, Teva Pharmaceuticals (NYSE: TEVA) became a customer. In August, three customers were added – Eli Lilly, Biogen and Regeneron.
“We expect roughly four more wins to come over the next few quarters,” he said. “We believe the Vault platform is well-developed to easily handle both CRM and R&D applications, and this move away from Salesforce gives the firm the independence to run all its offerings.”
Veeva’s current software capabilities along with adding agentic options continues to attract additional pharmaceutical companies as they adopt AI to achieve greater efficiency and lower costs.
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