Veeva's fiscal Q2 2027 (quarter to July 31, 2026) revenue rose 17.6% to $928.0M, beating guidance by ~$23M; GAAP EPS jumped 39.5% to $1.66, helped by lapping a $30.6M legal charge, and full-year revenue guidance was raised to $3,682–3,687M.
Revenue
$928M
+17.6% YoY
Net income
$273M
+36.5% YoY
Diluted EPS
$1.66
+39.5% YoY
Operating margin
29.6%
How VEEV compares with Health Care peers
Figure
VEEV
Peer median
Rank
Revenue growth (YoY)
+17.6%
+7.3%
7th of 53
Operating margin
29.6%
15.1%
10th of 53
EPS growth (YoY)
+39.5%
+15.1%
12th of 48
Rank 1 = fastest revenue growth, highest operating margin, fastest EPS growth. Peers are the other Health Care companies with a 2026 report on this site, each at its latest period we've analyzed; fiscal calendars differ, so periods are not always the same months.
Revenue up 18% and the full-year outlook raised again; GAAP profit jumped 37%, but part of that comes from comparing against a one-off legal charge
Veeva Systems sells cloud software and data to drug and biotech companies. Its products cover clinical trials and regulatory filings (the Vault platform, reported as "R&D and Quality Solutions") and sales and marketing work (Vault CRM, Crossix and Data Cloud, reported as "Commercial Solutions"). Veeva's fiscal year ends on January 31, so this report covers Veeva's second quarter of fiscal 2027: the three months ended July 31, 2026 (shown on this site as Q2 2026). Total revenue rose 17.6% to $928.0 million, which beat the top of management's own $902–905 million guidance by about $23 million. GAAP net income rose 36.5% to $273.4 million. GAAP is the standard, audited accounting basis.
At a glance
$766.8 million subscription revenue, +16.3%. This is recurring software and data fees, 83% of the total. Growth came faster than in Q1 (fiscal Q1 total revenue grew 16.3%), and the clinical/quality side grew faster than the sales-software side.
29.6% GAAP operating margin, up from 24.8%. Operating margin is the share of revenue left after running the business, before interest and tax. About 3.9 points of the gain come from a $30.6 million litigation-settlement charge that sat in last year's quarter. The underlying improvement is closer to 1 point.
Full-year revenue guidance raised to $3,682–3,687 million, from $3,635–3,645 million in June. The midpoint rose about $45 million, which roughly matches the size of this quarter's beat.
The numbers
Metric
Q2 FY2027 (to Jul 31, 2026)
Q2 FY2026 (to Jul 31, 2025)
YoY Change
Total revenue
$928.0M
$789.1M
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Subscription revenue rose $107.6 million. The 10-Q attributes $68 million of that to R&D and Quality Solutions (up 19.3% to $419.4 million) and $40 million to Commercial Solutions (up 13.0% to $347.4 million). The filing names two causes: "expanding use by existing customers and higher prices in connection with our annual inflation adjustment." In other words, the growth came mostly from existing customers buying more and from Veeva's annual price increase, not from new customers. The filing does not separate the two effects.
Commercial growing at 13% is worth noting because that segment includes the CRM product. Veeva is moving its large pharma customers off its older Salesforce-based CRM onto its own Vault CRM. The earnings release says more than 180 customers are live on Vault CRM, including five of the top 20 biopharmas. It also says three more large drugmakers committed in August, which brings top-20 commitments to 12. A migration like this can pause revenue for a while as customers switch over, and so far that has not shown up in Commercial subscription growth.
Professional services revenue (implementation and consulting work) grew faster than subscriptions, up 24.1%. The 10-Q attributes this to "an increase in implementation services and business consulting." That is a volume win but a margin drag. Services earned a GAAP gross margin of only 21.6%, compared with 86.2% on subscriptions, so the faster services growth is the main reason overall gross margin slipped from 75.3% to 75.0%. Subscription gross margin itself improved slightly, from 85.8% to 86.2%, even though computing and data costs rose $12 million.
Geographically, North America made up 60% of subscription revenue, Europe 29% and other regions 11%. A year ago the split was 59%, 28% and 13%. About 83% of year-to-date revenue was in US dollars, so currency moves had little effect on the headline growth rate.
What the headline numbers hide
The 37% profit jump flatters the trend. Last year's Q2 included a $30.6 million litigation settlement-related charge in general and administrative costs. The 10-Q gives that as the main reason G&A fell from $95.8 million to $71.3 million. Without it, last year's GAAP operating income would have been about $226.5 million, which puts this year's growth at about 21% rather than 40%. The underlying GAAP operating margin rose from about 28.7% to 29.6%, not from 24.8%.
Lower tax and fewer shares help EPS. The effective tax rate fell to 21.8% from 24.5%. The 10-Q attributes this mainly to a larger FDDEI deduction (a US tax break on income from serving foreign customers) under the 2025 "One Big Beautiful Bill Act," partly offset by stock-compensation tax deficiencies. At last year's tax rate, GAAP EPS would have been about $1.60 rather than $1.66. Separately, diluted shares fell 1.6% to 165.1 million. Veeva bought back 1.41 million shares for $245.7 million in the quarter, at an average of $174.48, and $466.8 million worth year to date. That adds roughly 1.6 points to EPS growth. After both effects and the legal-charge comparison, operating growth still drives most of the result.
GAAP vs non-GAAP gap: stock pay is the big item. Non-GAAP operating income was $415.9 million against $275.0 million GAAP. That $140.9 million difference is almost all stock-based compensation of $136.8 million (14.7% of revenue, down from 15.5%), plus $4.1 million of acquisition-intangible amortization. Stock compensation is a real cost to shareholders because it dilutes them. It is rising more slowly than revenue (+12.2% vs +17.6%), and that accounts for part of the GAAP margin gain. The non-GAAP figures use a fixed 21% tax rate, so non-GAAP EPS (+18.1%) gives the cleaner view of operating growth.
Cash conversion is healthy, but read it year-to-date. Q2 operating cash flow of $238.7 million was below net income, and flat on last year. This is normal for Veeva: most customers are billed annually around the fiscal year start, so cash arrives mostly in Q1. For the six months, operating cash flow was $1,365.8 million against $534.4 million of net income, up 22.4%. The 10-Q credits higher collections and lower income-tax payments from the new tax law. The balance sheet holds $7.24 billion of cash and short-term investments and no borrowings.
Small acquisitions. Veeva bought Ostro (an AI chat engagement tool for pharma) in March for $90 million, or $70 million net of cash acquired. It also bought Copli during Q2, the same quarter it launched Veeva Falcon MLR for automating content reviews. Net acquisition spending was $81.8 million year to date. That is too small to explain the quarter's revenue growth, but it is one reason intangible amortization is starting to grow again.
Takeaway: Veeva beat its own revenue guidance by about 2.5% and raised the year's outlook by roughly the same amount, while non-GAAP operating margin held at 44.8%. The underlying business is growing about 18% with stable profitability. The 37% GAAP profit jump is mostly an easy comparison against last year's legal charge plus a lower tax rate, and investors shouldn't read it as a new rate of growth.
Outlook
Management's updated guidance for fiscal 2027 (the year ending January 31, 2027):
Guidance item
June 2026 (after Q1)
August 2026 (after Q2)
FY total revenue
$3,635–3,645M
$3,682–3,687M
FY non-GAAP operating income
~$1,610M
~$1,640M
FY non-GAAP diluted EPS
~$9.05
~$9.21
Q3 total revenue (to Oct 31, 2026)
—
$932–935M
Q3 non-GAAP diluted EPS
—
$2.33–2.34
Veeva does not give GAAP profit guidance. It says stock-based compensation is too hard to forecast.
Our read: The guidance implies a slowdown. The Q3 range of $932–935 million is about 15% above last year's Q3 revenue of $811.2 million. The full-year midpoint of $3,684.5 million is 15.3% above fiscal 2026's $3,195.3 million. That leaves about $940 million for Q4, roughly 12.5% above last year's $836 million, compared with 17.6% growth this quarter. Veeva has guided conservatively all year: Q2 came in about $23 million above the top of its range. A similar beat in each of the next two quarters would put full-year growth around 16–17%.
The full-year non-GAAP operating income guide of about $1,640 million implies roughly a 44% margin in the second half, close to the first half's 44.8%. So management is not planning to trade margin for growth even while it spends on AI agents (Veeva AI, Falcon).
Three things to watch in the next report:
Whether Commercial subscription growth holds around 13% as more top-20 pharma customers switch to Vault CRM.
Whether services keep growing faster than subscriptions, which would keep pulling gross margin down.
How much the Q3 result beats the $932–935 million guide, since that shows whether the implied Q4 slowdown is real or just conservative guidance.
Figures are from Veeva's Form 10-Q for the quarter ended July 31, 2026 (filed August 27, 2026) and its Q2 fiscal 2027 earnings release (Exhibit 99.1, August 26, 2026). Prior guidance is from the Q1 fiscal 2027 earnings release (June 3, 2026). Prior-year Q3 and Q4 revenue are from Veeva's fiscal 2026 10-Q and 10-K filings.