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Veeva Systems, Inc. VEEV reported adjusted earnings per share (EPS) of $2.04 for the third quarter of fiscal 2026, which increased 16.6% from the year-ago figure of $1.75. Adjusted EPS beat the Zacks Consensus Estimate by 4.62%.
GAAP EPS in the fiscal third quarter was $1.40, up 23.9% from the year-ago period’s $1.13.
In the quarter under review, the company’s revenues totaled $811.2 million, beating the Zacks Consensus Estimate by 2.4%. On a year-over-year basis, the top line improved 16%.
The fiscal third-quarter top line was driven by Veeva Systems’ robust segmental performance.
Veeva Systems derives revenues from two operating segments — Subscription services and Professional services and other.
In the fiscal third quarter, Subscription services revenues improved 17.5% from the year-ago quarter to $682.5 million. Per management, this uptick was driven by both its established and newer solutions. Our estimate for the fiscal third-quarter revenues was $671 million.
Professional services and other revenues increased 13% year over year to $128.7 million. Our estimate for the fiscal third-quarter revenues was $120.1 million.
In the quarter under review, Veeva Systems’ gross profit improved 16.6% year over year to $611.8 million. The gross margin expanded 30 basis points (bps) to 75.4%. We predicted 75.3% of gross margin for the fiscal third quarter.
Sales and marketing expenses increased 12% year over year to $110.6 million. Research and development (R&D) expenses rose 11.3% year over year to $191.9 million, while general and administrative expenses increased 56.1% year over year to $68.5 million. Total operating expenses of $370.9 million increased 7.9% year over year.
Operating profit totaled $240.9 million, which increased 32.8% from the prior-year quarter. The operating margin in the fiscal third quarter expanded 380 bps to 29.7%. We predicted a 26.7% operating margin for the fiscal third quarter.
Veeva Systems Inc. price-consensus-eps-surprise-chart | Veeva Systems Inc. Quote
The company exited third-quarter fiscal 2026 with cash and cash equivalents and short-term investments of $6.64 billion compared with $6.40 billion at the fiscal second-quarter end.
Cumulative net cash provided by operating activities at the end of the quarter was $1.31 billion compared with $1.02 billion a year ago.
Veeva Systems has issued its updated financial outlook for fiscal 2026 and provided estimates for the fourth quarter of fiscal 2026.
For the fiscal fourth quarter, the company expects total revenues between $807 million and $810 million. The Zacks Consensus Estimate is currently pegged at $798.2 million.
Subscription revenues are estimated to be approximately $696 million, and the same for Professional services and other is expected to be in the range of $111-$114 million for the fiscal fourth quarter.
For the fiscal fourth quarter, adjusted EPS is anticipated to be approximately $1.92. The Zacks Consensus Estimate is pegged at $1.87.
Veeva Systems now expects revenues for fiscal 2026 between $3,166 million and $3,169 million compared with the previous guidance of $3,134 million and $3,140 million. The Zacks Consensus Estimate is currently pegged at $3.14 billion.
For fiscal 2026, Subscription revenues are now expected to be approximately $2,672 million compared with the previous guidance of $2,657 million. This consists of Commercial Solutions’ subscription revenues of around $1,252 million and R&D Solutions’ subscription revenues of approximately $1,420 million.
Professional services and other revenues for fiscal 2026 are now expected to be between $494 million and $497 million.
Adjusted EPS for fiscal 2026 is now expected to be $7.93 compared with the previous guidance of $7.78. The Zacks Consensus Estimate is pegged at $7.78.
Veeva Systems exited the third quarter of fiscal 2026 with better-than-expected results, wherein both earnings and revenues beat their respective Zacks Consensus Estimate. The uptick in both top and bottom lines and robust performance by the Subscription services segment during the quarter were impressive. The uptick in Professional services and others’ revenues also bodes well. However, shares of the company lost 6.1% in yesterday’s after-market trading. The stock gained 21.3% in the year-to-date period compared with the industryand the S&P 500’s growth of 9.4% and 14.2%, respectively.
Per management, the company saw meaningful momentum during the fiscal third quarter as Veeva AI hit several important milestones. The team is pushing ahead with a focused strategy to build deep, industry-specific AI agents that can materially elevate productivity and execution across life sciences workflows. The first wave of agents—supporting CRM and commercial content—remains on track for release in early December, while additional agents for R&D, quality and broader commercial functions are already in development for 2026. Management reiterated confidence that these AI layers are likely to become core value drivers as customers increasingly look for embedded intelligence in their daily systems.
During the quarter, Veeva Systems also strengthened its leadership position in CRM, driven by expanding adoption and product excellence across global markets. Vault CRM added 23 new customers, bringing the total number of live customers to 115. A major highlight was a large rollout for a top-20 biopharma company in Japan, which showcased the platform’s ability to support complex, multinational deployments. This builds on the ongoing success of two other top-20 biopharmas already live and performing well across major regions, reinforcing Veeva Systems’ edge in delivering consistent outcomes at scale.
Management also noted strong progress within Veeva Development Cloud, which represents the company’s biggest long-term opportunity in life sciences. Three top-20 biopharma companies selected Development Cloud applications as their enterprise standard during the quarter, one each for Veeva Study Startup, Veeva Study Training, and Veeva Safety. In safety, specifically, the newest part of the portfolio, the third top-20 biopharma went live, signaling rising industry confidence. Veeva Systems also advanced several large opportunities as more global pharma players look to modernize pharmacovigilance and streamline R&D operations through a unified, cloud-based platform.
VEEV carries a Zacks Rank #3 (Hold) at present.
Some better-ranked stocks from the broader medical space are Medpace Holdings MEDP, Intuitive Surgical ISRG and Boston Scientific BSX.
Medpace, currently sporting a Zacks Rank #1 (Strong Buy), reported a third-quarter 2025 EPS of $3.86, which surpassed the Zacks Consensus Estimate by 10.29%. Revenues of $659.9 million beat the Zacks Consensus Estimate by 3.04%. You can see the complete list of today’s Zacks #1 Rank stocks here.
MEDP has an estimated earnings growth rate of 17.1% for 2025 compared with the industry’s 16.6% growth. The company beat earnings estimates in each of the trailing four quarters, the average surprise being 14.28%.
Intuitive Surgical, carrying a Zacks Rank #2 (Buy) at present, posted a third-quarter 2025 adjusted EPS of $2.40, exceeding the Zacks Consensus Estimate by 20.6%. Revenues of $2.51 billion topped the Zacks Consensus Estimate by 3.9%.
ISRG has an estimated long-term earnings growth rate of 15.7% compared with the industry’s 11.9% growth. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 16.34%.
Boston Scientific, currently carrying a Zacks Rank #2, reported a third-quarter 2025 adjusted EPS of 75 cents, which surpassed the Zacks Consensus Estimate by 5.6%. Revenues of $5.07 billion outperformed the Zacks Consensus Estimate by 1.9%.
BSX has an estimated long-term earnings growth rate of 16.4% compared with the industry’s 13.5% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 7.36%.
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This article originally published on Zacks Investment Research (zacks.com).
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