Veeva : Q4 2022 Prepared Remarks

March 2, 2022

Q4 FY2022 Earnings Prepared Remarks

Peter Gassner, Founder, CEO

Brent Bowman, CFO

Legal Disclaimer

These prepared remarks contain forward-looking statements regarding Veeva's expected future performance and, in particular, includes guidance provided as of March 2, 2022 about Veeva's expected future financial results. Estimating guidance accurately for future periods is difficult. It involves assumptions and internal estimates that may prove to be incorrect and is based on plans that may change. Hence, there is a significant risk that actual results could differ materially from the guidance we have provided in these prepared remarks, and we have no obligation to update such guidance. There are also numerous risks that have the potential to negatively impact our financial performance, including as a result of competitive factors, customer decisions and priorities, events that impact the life sciences industry, issues related to the security or performance of our products, the pandemic, issues that impact our ability to hire, retain and adequately compensate talented employees, and general macroeconomic and geo-political events (including impacts related to events in Ukraine). We have summarized on one page what we believe are the principal risks to our business in a section titled "Summary of Risk Factors" on page 39 in our filing on Form 10-Q for the period ended October 31, 2021, which you can find here. Additional details on the risks and uncertainties that may impact our business can be found in the same filing on Form 10-Q and in our subsequent SEC filings, which you can access at sec.gov. We recommend that you familiarize yourself with these risks and uncertainties before making an investment decision.

These prepared remarks also contain certain non-GAAP metrics that we believe aid in the understanding of our financial results. A reconciliation to comparable GAAP metrics can be found in our earnings press release and in the supplemental investor presentation, both available on the Veeva website here. Our earnings press release also includes important information about our use of non-GAAP metrics and our non-GAAP guidance for future periods.

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Veeva, Vault, and Crossix are registered trademarks of Veeva Systems Inc.

Q4 Business Update

Peter Gassner, Founder, CEO

First, a point about Ukraine before we get into the numbers. We condemn Russia's invasion of Ukraine and are hopeful for a quick and positive resolution. Our hearts go out to all the people impacted by this act of aggression.

Financial Results

The fourth quarter was a solid finish to what was an exceptional year for Veeva as we outperformed against our guidance for the quarter and the year. Total revenue was $485 million, up 22% year over year and subscription revenue grew 23% to $396 million. Non-GAAP operating income was $186 million or 38% of total revenue. Fiscal year revenue was $1.85 billion, up 26% and subscription revenue also grew 26% to $1.48 billion.

I am very proud of what our team accomplished this year. But before we get into the details of the quarter and year, I'd like to share a few thoughts as we've just crossed the 15-year mark.

We founded Veeva on the idea that industry cloud was a major untapped opportunity in enterprise software. Fifteen years in, we're now at a nearly $2 billion run rate and delivering significant value for more than 1,200 customers. And it's still early days for industry cloud and for Veeva.

We have a significant opportunity ahead to enable the most critical functions for the $2 trillion life sciences industry with software, consulting, services, and data. The trust we've built within the industry, our focused execution, and product excellence creates a long runway of strong organic growth and profitability for Veeva well beyond 2025.

Commercial Solutions

Our market leading position in commercial expanded in the quarter and year. First, we gained share with core Veeva CRM, adding nearly 50 new customers in the year. Q4 saw eight CRM additions and significant expansions geographically.

Core Veeva CRM for field reps is our flagship commercial product and the foundation for expansion into newer commercial areas, which are now a growing part of the mix. As of Q4, roughly 40% of commercial subscription revenue is in data, analytics, and content, which aren't licensed by the rep. As these areas grow, we expect them to continue to become a larger portion of the revenue.

The industry's move to digital is also driving expansion of our commercial content business with Veeva Vault PromoMats, now adopted by nearly 450 customers, up more than 60 in the year and 13 in Q4.

Veeva Crossix analytics continued to gain momentum with two seven-figure enterprise wins and accelerating growth with SMB customers. In the year, we also had our first top 20 pharma commit to using Crossix analytics across all brands.

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In data, Veeva Link ended the year strong with our fourth top 20 pharma selecting Veeva Link for all therapeutic areas after starting with oncology earlier in the year. Link is becoming a high leverage platform for Veeva. It's a powerful, modern data platform that we can use to build additional data products.

Veeva Data Cloud is very early in its maturity. We closed the year with 10 early adopter customers. We're getting great feedback and are rapidly advancing the product and growing the team.

Overall, I am very excited about the data opportunities ahead for Veeva and the innovation we're bringing to market. It reminds me in some ways of the early days of Veeva Vault.

R&D Solutions

In R&D, we continue to make great progress in streamlining drug development to speed time to market and improve the patient experience. We are well positioned with the right vision, products, and track record of customer success to establish Veeva Development Cloud as the operating system for drug development for the industry.

It was an excellent year across the board in R&D and we are especially pleased with the momentum we saw in clinical and quality, which represent our largest current market opportunities in Veeva Development Cloud.

We added 100 customers this year in clinical overall, up nearly 30% from the year prior.

Clinical operations is growing well. eTMF remains strong, adding 19 customers in the quarter, and we are the clear leader. Veeva Vault CTMS has become the industry leading solution and in Q4 we signed our seventh enterprise agreement with a top 20 pharma.

Momentum continues to build in clinical data management, where we added 10 new customers in the quarter and are establishing Vault CDMS as the modern solution to meet the needs of today's trials. We now have two top 20 pharmas that are using Veeva Vault EDC for all new studies. We are also seeing success building with our CRO partners. In Q4 we had a top six CRO switch to Veeva Vault EDC as their primary recommended solution in proposals to sponsors. It's exciting times ahead for what we anticipate will be the largest clinical area for Veeva in the future.

Quality continues strong. We added more than 100 customers this year, up nearly 35% year over year. We again closed more than 20 Vault QMS wins in the quarter.

Our approach of unifying quality on an integrated suite is resonating with the market and represents a very large opportunity ahead for Veeva. Sales of QualityDocs, QMS and Training continue to be strong and development of Vault LIMS, which is a large, complex, and mission critical new product area, is going well and we expect our first early adopters to go live toward the end of this year.

Fiscal Year Guidance and Long-term Outlook

For fiscal year 2023, we expect total revenue between $2.160 and $2.170 billion, which reflects stronger growth in the second half of the year due to deal timing.

As a result of a tighter labor market, especially in the U.S., we and our customers have been shorter than

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usual on talent, so deals and project starts are taking a bit more time. We are hiring well and we expect to see the benefit of our strong hiring quarter flow through in the back half of the year.

To the positive, the industry's priorities have not changed, and they remain well aligned with our solutions. Our competitive position continues to strengthen, win rates are high, and our multi product innovation engine is extremely strong. I'm very impressed with all the innovations coming out of our product teams.

I am especially optimistic as I look at the potential of key new markets like clinical data management, safety, digital trials, and data. It is early, and these areas don't move quickly, but these are big areas that will support long-term durable growth and have a major impact for the industry.

Overall, this translates to a deepening of our strategic partnerships with the industry and, as a

result we are now progressing our largest deals ever. Being a public benefit corporation (PBC) is giving large customers additional support to go all-in with Veeva for the next 20-plus years across mission critical areas.

We are also excited to get back together with the industry in-person. Our sales teams are now traveling to customers and we are bringing the industry together again this Spring at Veeva Summits in Boston and Zurich. We managed through COVID well but getting together in-person strengthens the industry's connectivity, advances our relationships, and contributes to results over the long-term.

In summary, our strong fourth quarter capped off another great year. We're proud of the role we continue to play as a strategic partner to the industry and I'm excited about the opportunities ahead.

Peter Gassner, Founder, CEO

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