Veeva(VEEV) - 2024 Q4 - Annual Results

Financial Performance Fourth Quarter Fiscal 2024 Results Veeva reported strong Q4 FY2024 results with total revenues up 12% to $630.6 million, despite a 22% GAAP net income decrease due to a contracting change | Financial Metric | Q4 FY2024 | Q4 FY2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | Total Revenues | $630.6M | $563.4M | +12% | | Subscription Services Revenues | $521.5M | $460.2M | +13% | | GAAP Operating Income | $135.3M | $108.9M | +24% | | Non-GAAP Operating Income | $239.1M | $209.4M | +14% | | GAAP Net Income | $147.4M | $188.5M | -22% | | Non-GAAP Net Income | $226.3M | $186.3M | +21% | | GAAP Diluted EPS | $0.90 | $1.16 | -22.4% | | Non-GAAP Diluted EPS | $1.38 | $1.15 | +20.0% | - A customer contracting change standardizing termination for convenience (TFC) rights, effective February 1, 2023, altered revenue recognition timing and negatively impacted reported revenues and profits for the quarter[3] Full Fiscal Year 2024 Results Full fiscal year 2024 saw total revenues grow 10% to $2,363.7 million, with non-GAAP net income up 14% despite a 6% GAAP operating income decrease | Financial Metric | Fiscal Year 2024 | Fiscal Year 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | Total Revenues | $2,363.7M | $2,155.1M | +10% | | Subscription Services Revenues | $1,901.6M | $1,733.0M | +10% | | GAAP Operating Income | $429.3M | $459.1M | -6% | | Non-GAAP Operating Income | $842.5M | $830.5M | +1% | | GAAP Net Income | $525.7M | $487.7M | +8% | | Non-GAAP Net Income | $791.0M | $695.6M | +14% | | GAAP Diluted EPS | $3.22 | $3.00 | +7.3% | | Non-GAAP Diluted EPS | $4.84 | $4.28 | +13.1% | - The customer contracting change involving TFC rights also impacted full fiscal year results, reducing reported revenues and profits[6] Business and Operational Highlights Veeva ended FY2024 with 1,432 customers, advancing its Clinical Platform adoption and fully launching the Veeva Compass Suite - Total customer count grew to 1,432, an increase of 44 year-over-year, comprising 1,078 R&D Solutions and 693 Commercial Solutions customers[6] - The Veeva Clinical Platform is gaining traction, with over 500 customers using at least one Vault Clinical solution and over 85 customers using products for both clinical operations and data management[6] - The Veeva Compass Suite of commercial data products is now fully available, and the ninth top 20 biopharma company selected Veeva Link for Key People[6] Financial Outlook Q1 Fiscal 2025 Guidance Veeva projects Q1 FY2025 total revenues between $640 million and $643 million, with non-GAAP operating income of $245 million to $247 million | Metric | Q1 FY2025 Guidance | | :--- | :--- | | Total Revenues | $640M - $643M | | Non-GAAP Operating Income | $245M - $247M | | Non-GAAP Fully Diluted EPS | $1.42 - $1.43 | Full Year Fiscal 2025 Guidance For full fiscal year 2025, Veeva expects total revenues between $2,725 million and $2,740 million, with non-GAAP operating income around $1,070 million | Metric | Full Year FY2025 Guidance | | :--- | :--- | | Total Revenues | $2,725M - $2,740M | | Non-GAAP Operating Income | ~$1,070M | | Non-GAAP Fully Diluted EPS | ~$6.16 | Consolidated Financial Statements (GAAP) Consolidated Balance Sheets As of January 31, 2024, Veeva's balance sheet shows strong liquidity with total assets of $5.91 billion, cash and short-term investments over $4.0 billion, and total stockholders' equity of $4.64 billion | Balance Sheet Item (in thousands) | Jan 31, 2024 | Jan 31, 2023 | | :--- | :--- | :--- | | Cash and short-term investments | $4,027,756 | $3,102,628 | | Total Assets | $5,910,920 | $4,804,296 | | Total Liabilities | $1,266,096 | $1,088,044 | | Total Stockholders' Equity | $4,644,824 | $3,716,252 | Consolidated Statements of Comprehensive Income For fiscal year 2024, total revenues increased 10% to $2.36 billion, with subscription services as the primary driver at $1.90 billion, resulting in $525.7 million net income | Income Statement Item (FY2024, in thousands) | Amount | | :--- | :--- | | Total Revenues | $2,363,673 | | Gross Profit | $1,686,382 | | Operating Income | $429,334 | | Net Income | $525,705 | | Revenue Breakdown (FY2024, in thousands) | Veeva Commercial Solutions | Veeva R&D Solutions | Total | | :--- | :--- | :--- | :--- | | Subscription Services | $995,803 | $905,790 | $1,901,593 | | Professional Services & Other | $185,981 | $276,099 | $462,080 | Consolidated Statements of Cash Flows In fiscal year 2024, Veeva generated $911.3 million in net cash from operating activities, while using $1.08 billion in investing activities, primarily for short-term investments | Cash Flow Item (FY2024, in thousands) | Amount | | :--- | :--- | | Net cash provided by operating activities | $911,339 | | Net cash used in investing activities | ($1,076,351) | | Net cash used in financing activities | ($16,188) | | Net change in cash | ($182,980) | Non-GAAP Financial Measures & Reconciliation Explanation of Non-GAAP Measures Veeva utilizes non-GAAP financial measures, excluding non-cash expenses and related tax effects, to enhance understanding of operating results and facilitate period-over-period comparisons - Non-GAAP measures exclude stock-based compensation, amortization of purchased intangibles, excess tax benefits from employee stock plans, and their related income tax effects[25] - The company uses these measures internally for budgeting and believes they aid investors in comparing core business results across periods and with peers[22] Reconciliation of GAAP to Non-GAAP Metrics For fiscal year 2024, GAAP to non-GAAP reconciliation primarily involved adjusting for $393.7 million in stock-based compensation and $19.5 million in amortization of purchased intangibles | Reconciliation of Operating Income (FY2024, in thousands) | Amount | | :--- | :--- | | GAAP Operating Income | $429,334 | | Add: Stock-based compensation expense | $393,733 | | Add: Amortization of purchased intangibles | $19,459 | | Non-GAAP Operating Income | $842,526 | | Reconciliation of Net Income (FY2024, in thousands) | Amount | | :--- | :--- | | GAAP Net Income | $525,705 | | Add: Stock-based compensation expense | $393,733 | | Add: Amortization of purchased intangibles | $19,459 | | Less: Income tax effect on non-GAAP adjustments | ($147,937) | | Non-GAAP Net Income | $790,960 |