UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 24, 2017
Veeva Systems Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware | 001-36121 | 20-8235463 | ||
(State or Other Jurisdiction |
(Commission File Number) |
(IRS Employer |
4280 Hacienda Drive
Pleasanton, California |
94588 |
|
(Address of Principal Executive Offices) |
(Zip Code) |
Registrant’s Telephone Number, Including Area Code: (925) 452-6500
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2):
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company |
⃞ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. |
⃞ |
Item 2.02. Results of Operations and Financial Condition.
On August 24, 2017, Veeva Systems Inc. issued a press release announcing its results for its second quarter ended July 31, 2017. A copy of the press release is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information in this Current Report on Form 8-K and the accompanying Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing, unless expressly incorporated by reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit | ||
No. | Description | |
99.1 | Press Release titled “Veeva Announces Fiscal 2018 Second Quarter Results,” dated August 24, 2017 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Veeva Systems Inc. |
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By: |
/s/ TIMOTHY S. CABRAL |
Timothy S. Cabral |
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Chief Financial Officer |
Dated: August 24, 2017
EXHIBIT INDEX
Exhibit | ||
No. | Description | |
99.1 |
Press Release titled “Veeva Announces Fiscal 2018 Second Quarter Results,” dated August 24, 2017 |
Exhibit 99.1
Veeva Announces Fiscal 2018 Second Quarter Results
Total Revenues of $166.6M, up 27% Year-Over-Year
Subscription Services Revenues of $134.3M, up 28% Year-Over-Year
PLEASANTON, Calif.--(BUSINESS WIRE)--August 24, 2017--Veeva Systems Inc. (NYSE: VEEV), a leading provider of industry cloud solutions for the global life sciences industry, today announced results for its fiscal second quarter ended July 31, 2017.
“It was another strong quarter for Veeva, with especially good momentum in Vault Clinical,” said CEO Peter Gassner. “We are expanding our market leadership positions and having early success in large new markets. We have all the pieces in place and the disciplined execution needed to achieve our goal of being the most strategic technology partner to the life sciences industry.”
Fiscal 2018 Second Quarter Results:
“Our focus on customer success and consistent execution across the business drove another solid quarter of financial results above our guidance,” said CFO Tim Cabral. “We are investing aggressively in product innovation, sales, and services to fuel long-term growth.”
Recent Highlights:
Financial Outlook:
Veeva is providing guidance for its fiscal third quarter ending October 31, 2017 as follows:
Veeva is providing guidance for its fiscal year ending January 31, 2018 as follows:
Conference Call Information: |
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What: | Veeva’s Fiscal 2018 Second Quarter Results Conference Call | |||
When: | Thursday, August 24, 2017 | |||
Time: | 1:30 p.m. PT (4:30 p.m. ET) | |||
Live Call: | 1-833-235-5654, domestic | |||
1-647-689-4160, international | ||||
Webcast: |
ir.veeva.com |
__________
(1) This press release uses non-GAAP financial metrics that are adjusted for the impact of various GAAP items. See the section titled “Non-GAAP Financial Measures” and the tables entitled “Reconciliation of GAAP to Non-GAAP Financial Measures” below for details.
(2) Veeva is not able, at this time, to provide GAAP targets for operating income and fully diluted net income per share for the third fiscal quarter ending October 31, 2017 or fiscal year ending January 31, 2018 because of the difficulty of estimating certain items excluded from non-GAAP operating income and non-GAAP fully diluted net income per share that cannot be reasonably predicted, such as charges related to stock-based compensation expense, capitalization of internal-use software development expenses and the subsequent amortization of the capitalized expenses. The effect of these excluded items may be significant.
About Veeva Systems
Veeva Systems Inc. is a leader in cloud-based software for the global life sciences industry. Committed to innovation, product excellence, and customer success, Veeva has more than 550 customers, ranging from the world’s largest pharmaceutical companies to emerging biotechs. Veeva is headquartered in the San Francisco Bay Area, with offices in Europe, Asia, and Latin America. For more information, visit veeva.com.
Forward-looking Statements
This release contains forward-looking statements, including the quotations from management, the statements in “Financial Outlook,” and other statements regarding Veeva’s future performance, market growth, the benefits from the use of Veeva’s solutions, our strategies, and general business conditions. Any forward-looking statements contained in this press release are based upon Veeva’s historical performance and its current plans, estimates and expectations and are not a representation that such plans, estimates, or expectations will be achieved. These forward-looking statements represent Veeva’s expectations as of the date of this press announcement. Subsequent events may cause these expectations to change, and Veeva disclaims any obligation to update the forward-looking statements in the future. These forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially, including (i) historical fluctuation of our quarterly results and our limited operating history, which make it difficult to predict future results; (ii) our expectation that the future growth rate of our revenues will decline, and that as our costs increase, we may not be able to generate sufficient revenues to sustain the level of profitability we have achieved in the past or achieve profitability in the future; (iii) breaches in our security measures or unauthorized access to our customers’ data; (iv) system unavailability, performance problems, or loss of data due to disruptions or other problems with our data center operations or computing infrastructure; (v) dependence on revenues from our Veeva CRM solution, and the rate of adoption of our new products; (vi) acceptance of our applications and services by customers, including renewals of existing subscriptions and purchases of subscriptions for additional users and solutions; (vii) our ability to retain Zinc Ahead customers and achieve the expected results from our acquisition of Zinc Ahead; (viii) loss of one or more key customers; (ix) adverse changes in general economic or market conditions, particularly in the life sciences industry; (x) delays or reductions in information technology spending, particularly in the life sciences industry, including as a result of mergers in the life sciences industry; (xi) the development of the market for enterprise cloud services, particularly in the life sciences industry; (xii) competitive factors, including but not limited to pricing pressures, industry consolidation, difficulty securing rights to access, host or integrate with complementary third party products or data used by our customers, entry of new competitors and new applications and marketing initiatives by our competitors; (xiii) our ability to manage our growth effectively; (xiv) changes in sales that may not be immediately reflected in our results due to the ratable recognition of our subscription revenue; and (xv) pending, threatened, or future legal proceedings and related expenses.
Additional risks and uncertainties that could affect Veeva’s financial results are included under the captions, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the company’s filing on Form 10-Q for the period ended April 30, 2017. This is available on the company’s website at veeva.com under the Investors section and on the SEC’s website at sec.gov. Further information on potential risks that could affect actual results will be included in other filings Veeva makes with the SEC from time to time.
VEEVA SYSTEMS INC. | ||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(In thousands) |
||||||
(Unaudited) | ||||||
July 31, | January 31, | |||||
2017 | 2017 | |||||
Assets | ||||||
Current assets: | ||||||
Cash and cash equivalents | $ | 409,226 | $ | 217,606 | ||
Short-term investments | 315,425 | 301,266 | ||||
Accounts receivable, net | 97,153 | 182,816 | ||||
Prepaid expenses and other current assets |
11,551 | 10,177 | ||||
Total current assets | 833,355 | 711,865 | ||||
Property and equipment, net | 53,528 | 49,907 | ||||
Goodwill | 95,804 | 95,804 | ||||
Intangible assets, net | 35,288 | 39,283 | ||||
Deferred income taxes, noncurrent | 12,957 | 16,460 | ||||
Other long-term assets | 4,938 | 4,057 | ||||
Total assets | $ | 1,035,870 | $ | 917,376 | ||
Liabilities and stockholders’ equity | ||||||
Current liabilities: | ||||||
Accounts payable | $ | 6,298 | $ | 5,677 | ||
Accrued compensation and benefits | 12,076 | 12,007 | ||||
Accrued expenses and other current liabilities | 12,291 | 12,310 | ||||
Income tax payable | 2,228 | 3,228 | ||||
Deferred revenue | 222,685 | 213,562 | ||||
Total current liabilities | 255,578 | 246,784 | ||||
Deferred income taxes, noncurrent | 7,561 | 12,974 | ||||
Other long-term liabilities | 6,128 | 4,964 | ||||
Total liabilities | 269,267 | 264,722 | ||||
Stockholders’ equity: | ||||||
Class A common stock | 1 | 1 | ||||
Class B common stock | — | — | ||||
Additional paid-in capital | 478,580 | 439,658 | ||||
Accumulated other comprehensive income | 1,271 | 111 | ||||
Retained earnings | 286,751 | 212,884 | ||||
Total stockholders’ equity | 766,603 | 652,654 | ||||
Total liabilities and stockholders’ equity | $ | 1,035,870 | $ | 917,376 | ||
VEEVA SYSTEMS INC. |
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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
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(In thousands, except per share data) |
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(Unaudited) | ||||||||||||||
Three months ended |
Six months ended |
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2017 | 2016 | 2017 | 2016 | |||||||||||
Revenues: | ||||||||||||||
Subscription services | $ | 134,340 | $ | 105,211 | $ | 261,617 | $ | 201,243 | ||||||
Professional services and other | 32,245 | 26,136 | 62,886 | 49,868 | ||||||||||
Total revenues | 166,585 | 131,347 | 324,503 | 251,111 | ||||||||||
Cost of revenues(3): | ||||||||||||||
Cost of subscription services | 26,800 | 23,108 | 52,938 | 44,853 | ||||||||||
Cost of professional services and other | 23,604 | 19,087 | 46,348 | 38,433 | ||||||||||
Total cost of revenues | 50,404 | 42,195 | 99,286 | 83,286 | ||||||||||
Gross profit | 116,181 | 89,152 | 225,217 | 167,825 | ||||||||||
Operating expenses(3): | ||||||||||||||
Research and development | 32,691 | 23,563 | 61,002 | 45,636 | ||||||||||
Sales and marketing | 32,017 | 28,908 | 61,827 | 55,631 | ||||||||||
General and administrative | 14,575 | 12,859 | 28,151 | 24,930 | ||||||||||
Total operating expenses | 79,283 | 65,330 | 150,980 | 126,197 | ||||||||||
Operating income | 36,898 | 23,822 | 74,237 | 41,628 | ||||||||||
Other income (expense), net | 2,858 | (1,362 | ) | 3,449 | 1,385 | |||||||||
Income before income taxes | 39,756 | 22,460 | 77,686 | 43,013 | ||||||||||
Provision for income taxes | 1,912 | 9,502 | 3,819 | 17,546 | ||||||||||
Net income | $ | 37,844 | $ | 12,958 | $ | 73,867 | $ | 25,467 | ||||||
Net income attributable to common stockholders, basic and diluted: | $ | 37,844 | $ | 12,957 | $ | 73,867 | $ | 25,465 | ||||||
Net income per share attributable to common stockholders: | ||||||||||||||
Basic |
$ | 0.27 | $ | 0.10 | $ | 0.53 | $ | 0.19 | ||||||
Diluted | $ | 0.25 | $ | 0.09 | $ | 0.48 | $ | 0.17 | ||||||
Weighted-average shares used to compute net income per share
attributable to common stockholders: |
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Basic | 140,010 | 135,126 | 139,351 | 134,531 | ||||||||||
Diluted | 153,778 | 147,155 | 153,301 | 146,690 | ||||||||||
Other comprehensive income (loss): | ||||||||||||||
Net change in unrealized gains (losses) on available-for-sale investments | $ | 34 | $ | 98 | $ | (72 | ) | $ | 272 | |||||
Net change in cumulative foreign currency translation gain (loss) | 327 | 312 | 1,232 | 425 | ||||||||||
Comprehensive income | $ | 38,205 | $ | 13,368 | $ | 75,027 | $ | 26,164 | ||||||
_____ |
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(3) Includes stock-based compensation as follows: | ||||||||||||||
Cost of revenues: | ||||||||||||||
Cost of subscription services | $ | 376 | $ | 288 | $ | 718 | $ | 497 | ||||||
Cost of professional services and other | 2,133 | 1,507 | 3,822 | 2,685 | ||||||||||
Research and development | 4,349 | 2,812 | 8,151 | 5,206 | ||||||||||
Sales and marketing | 4,173 | 3,342 | 8,020 | 5,797 | ||||||||||
General and administrative | 2,349 | 2,065 | 4,457 | 3,972 | ||||||||||
Total stock-based compensation | $ | 13,380 | $ | 10,014 | $ | 25,168 | $ | 18,157 | ||||||
VEEVA SYSTEMS INC. | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
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(In thousands) | ||||||||||||||||
(Unaudited) |
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Three months ended |
Six months ended |
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2017 | 2016 | 2017 | 2016 | |||||||||||||
Cash flows from operating activities | ||||||||||||||||
Net income | $ | 37,844 | $ | 12,958 | $ | 73,867 | $ | 25,467 | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
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Depreciation and amortization | 3,571 | 3,470 | 7,020 | 6,875 | ||||||||||||
Amortization of premiums on short-term investments | 386 | 469 | 842 | 889 | ||||||||||||
Stock-based compensation | 13,380 | 10,014 | 25,168 | 18,157 | ||||||||||||
Deferred income taxes | (708 | ) | 36 | (1,905 | ) | (802 | ) | |||||||||
Loss on foreign currency from market-to-market derivative | 204 | — | 253 | — | ||||||||||||
Bad debt expense | (198 | ) | 90 | (206 | ) | (115 | ) | |||||||||
Changes in operating assets and liabilities: | ||||||||||||||||
Accounts receivable | 16,169 | (7,277 | ) | 85,869 | 55,950 | |||||||||||
Income taxes | 483 | 1,264 | (2,062 | ) | 1,644 | |||||||||||
Other current and long-term assets | 332 | (9,466 | ) | (1,159 | ) | (8,076 | ) | |||||||||
Accounts payable | 700 | 1,805 | 244 | 1,871 | ||||||||||||
Accrued expenses and other current liabilities |
(361 | ) | 1,800 | 544 | (1,105 | ) | ||||||||||
Deferred revenue | (15,410 | ) | (4,058 | ) | 9,027 | 19,299 | ||||||||||
Other long-term liabilities | 1,215 | 641 | 2,266 | 1,052 | ||||||||||||
Net cash provided by operating activities(4) |
57,607 | 11,746 | 199,768 | 121,106 | ||||||||||||
Cash flows from investing activities | ||||||||||||||||
Purchases of short-term investments | (87,202 | ) | (116,219 | ) | (143,451 | ) | (183,959 | ) | ||||||||
Maturities and sales of short-term investments | 69,681 | 58,151 | 128,377 | 128,176 | ||||||||||||
Purchases of property and equipment | (2,535 | ) | (859 | ) | (6,495 | ) | (2,916 | ) | ||||||||
Capitalized internal-use software development costs | (242 | ) | (69 | ) | (1,033 | ) | (209 | ) | ||||||||
Changes in restricted cash and deposits | (201 | ) | 109 | (202 | ) | 103 | ||||||||||
Net cash provided by (used in) investing activities | (20,499 | ) | (58,887 | ) | (22,804 | ) | (58,805 | ) | ||||||||
Cash flows from financing activities | ||||||||||||||||
Proceeds from exercise of common stock options | 6,131 | 3,183 | 13,416 | 4,528 | ||||||||||||
Restricted stock units acquired to settle employee tax withholding liability | — | (11 | ) | — | (12 | ) | ||||||||||
Excess tax benefits from employee stock plans | — | 8,079 | — | 10,940 | ||||||||||||
Net cash provided by financing activities(4) | 6,131 | 11,251 | 13,416 | 15,456 | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents | 327 | 313 | 1,240 | 429 | ||||||||||||
Net change in cash and cash equivalents | 43,566 | (35,577 | ) | 191,620 | 78,186 | |||||||||||
Cash and cash equivalents at beginning of period | 365,660 | 245,942 | 217,606 | 132,179 | ||||||||||||
Cash and cash equivalents at end of period | $ | 409,226 | $ | 210,365 | $ | 409,226 | $ | 210,365 | ||||||||
_______ |
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(4) During the six months ended July 31, 2017, the Company adopted Accounting Standards Update (“ASU”) 2016-09, “Compensation-Stock Compensation: Improvements to Employee Share-Based Payment.” This adoption resulted in a $14.8 million and $28.7 million increase in net cash provided by operating activities and a corresponding decrease in net cash provided by financing activities for the three and six months ended July 31, 2017, respectively. |
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In Veeva’s public disclosures, Veeva has provided non-GAAP measures, which it defines as financial information that has not been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. In addition to its GAAP measures, Veeva uses these non-GAAP financial measures internally for budgeting and resource allocation purposes and in analyzing its financial results. For the reasons set forth below, Veeva believes that excluding the following items from its non-GAAP financial measures provides information that is helpful in understanding its operating results, evaluating its future prospects, comparing its financial results across accounting periods, and comparing its financial results to its peers, many of which provide similar non-GAAP financial measures.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Veeva encourages its investors and others to review its financial information in its entirety, not to rely on any single financial measure to evaluate its business, and to view its non-GAAP financial measures in conjunction with the most directly comparable GAAP financial measures. A reconciliation of GAAP to the non-GAAP financial measures has been provided in the tables below.
The following tables reconcile the specific items excluded from GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:
VEEVA SYSTEMS INC. | ||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES | ||||||||||||||||
(Dollars in thousands) |
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(Unaudited) | ||||||||||||||||
Three months ended |
Six months ended |
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2017 | 2016 | 2017 | 2016 | |||||||||||||
Cost of subscription services revenues on a GAAP basis | $ | 26,800 | $ | 23,108 | $ | 52,938 | $ | 44,853 | ||||||||
Stock-based compensation expense | (376 | ) | (288 | ) | (718 | ) | (497 | ) | ||||||||
Amortization of purchased intangibles | (1,009 | ) | (1,084 | ) | (2,064 | ) | (2,181 | ) | ||||||||
Amortization of internal-use software | (159 | ) | (185 | ) | (280 | ) | (362 | ) | ||||||||
Cost of subscription services revenues on a non-GAAP basis | $ | 25,256 | $ | 21,551 | $ | 49,876 | $ | 41,813 | ||||||||
Gross margin on subscription services revenues on a GAAP basis | 80.1 | % | 78.0 | % | 79.8 | % | 77.7 | % | ||||||||
Stock-based compensation expense | 0.2 | 0.3 | 0.3 | 0.2 | ||||||||||||
Amortization of purchased intangibles | 0.8 | 1.0 | 0.8 | 1.1 | ||||||||||||
Amortization of internal-use software | 0.1 | 0.2 | — | 0.2 | ||||||||||||
Gross margin on subscription services revenues on a non-GAAP basis | 81.2 | % | 79.5 | % | 80.9 | % | 79.2 | % | ||||||||
Cost of professional services and other revenues on a GAAP basis | $ | 23,604 | $ | 19,087 | $ | 46,348 | $ | 38,433 | ||||||||
Stock-based compensation expense | (2,133 | ) | (1,507 | ) | (3,822 | ) | (2,685 | ) | ||||||||
Deferred compensation associated with Zinc Ahead acquisition | (5 | ) | (8 | ) | (11 | ) | (17 | ) | ||||||||
Cost of professional services and other revenues on a non-GAAP basis | $ | 21,466 | $ | 17,572 | $ | 42,515 | $ | 35,731 | ||||||||
Gross margin on professional services and other revenues on a GAAP basis | 26.8 | % | 27.0 | % | 26.3 | % | 22.9 | % | ||||||||
Stock-based compensation expense | 6.6 | 5.8 | 6.1 | 5.4 | ||||||||||||
Gross margin on professional services and other revenues on a non-GAAP basis | 33.4 | % | 32.8 | % | 32.4 | % | 28.3 | % | ||||||||
Gross profit on a GAAP basis | $ | 116,181 | $ | 89,152 | $ | 225,217 | $ | 167,825 | ||||||||
Stock-based compensation expense | 2,509 | 1,795 | 4,540 | 3,182 | ||||||||||||
Amortization of purchased intangibles | 1,009 | 1,084 | 2,064 | 2,181 | ||||||||||||
Amortization of internal-use software | 159 | 185 | 280 | 362 | ||||||||||||
Deferred compensation associated with Zinc Ahead acquisition | 5 | 8 | 11 | 17 | ||||||||||||
Gross profit on a non-GAAP basis | $ | 119,863 | $ | 92,224 | $ | 232,112 | $ | 173,567 | ||||||||
Gross margin on total revenues on a GAAP basis | 69.7 | % | 67.9 | % | 69.4 | % | 66.8 | % | ||||||||
Stock-based compensation expense | 1.5 | 1.4 | 1.4 | 1.3 | ||||||||||||
Amortization of purchased intangibles | 0.6 | 0.8 | 0.6 | 0.9 | ||||||||||||
Amortization of internal-use software | 0.2 | 0.1 | 0.1 | 0.1 | ||||||||||||
Gross margin on total revenues on a non-GAAP basis | 72.0 | % | 70.2 | % | 71.5 | % | 69.1 | % | ||||||||
Research and development expense on a GAAP basis | $ | 32,691 | $ | 23,563 | $ | 61,002 | $ | 45,636 | ||||||||
Stock-based compensation expense | (4,349 | ) | (2,812 | ) | (8,151 | ) | (5,206 | ) | ||||||||
Capitalization of internal-use software | 243 | 69 | 1,033 | 209 | ||||||||||||
Deferred compensation associated with Zinc Ahead acquisition | (109 | ) | (108 | ) | (218 | ) | (217 | ) | ||||||||
Research and development expense on a non-GAAP basis | $ | 28,476 | $ | 20,712 | $ | 53,666 | $ | 40,422 | ||||||||
Sales and marketing expense on a GAAP basis | $ | 32,017 | $ | 28,908 | $ | 61,827 | $ | 55,631 | ||||||||
Stock-based compensation expense | (4,173 | ) | (3,342 | ) | (8,020 | ) | (5,797 | ) | ||||||||
Amortization of purchased intangibles | (977 | ) | (975 | ) | (1,924 | ) | (1,929 | ) | ||||||||
Deferred compensation associated with Zinc Ahead acquisition | (12 | ) | (18 | ) | (30 | ) | (36 | ) | ||||||||
Sales and marketing expense on a non-GAAP basis | $ | 26,855 | $ | 24,573 | $ | 51,853 | $ | 47,869 | ||||||||
General and administrative expense on a GAAP basis | $ | 14,575 | $ | 12,859 | $ | 28,151 | $ | 24,930 | ||||||||
Stock-based compensation expense | (2,349 | ) | (2,065 | ) | (4,457 | ) | (3,972 | ) | ||||||||
Deferred compensation associated with Zinc Ahead acquisition | (4 | ) | (596 | ) | (8 | ) | (1,873 | ) | ||||||||
General and administrative expense on a non-GAAP basis | $ | 12,222 | $ | 10,198 | $ | 23,686 | $ | 19,085 | ||||||||
VEEVA SYSTEMS INC. |
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RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (continued) |
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(Dollars in thousands, except per share data) |
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(Unaudited) |
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Three months ended |
Six months ended |
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2017 | 2016 | 2017 | 2016 | |||||||||||||
Operating expense on a GAAP basis | $ | 79,283 | $ | 65,330 | $ | 150,980 | $ | 126,197 | ||||||||
Stock-based compensation expense | (10,871 | ) | (8,219 | ) | (20,628 | ) | (14,975 | ) | ||||||||
Amortization of purchased intangibles | (977 | ) | (975 | ) | (1,924 | ) | (1,929 | ) | ||||||||
Capitalization of internal-use software | 243 | 69 | 1,033 | 209 | ||||||||||||
Deferred compensation associated with Zinc Ahead acquisition | (125 | ) | (722 | ) | (256 | ) | (2,126 | ) | ||||||||
Operating expense on a non-GAAP basis | $ | 67,553 | $ | 55,483 | $ | 129,205 | $ | 107,376 | ||||||||
Operating income on a GAAP basis | $ | 36,898 | $ | 23,822 | $ | 74,237 | $ | 41,628 | ||||||||
Stock-based compensation expense | 13,380 | 10,014 | 25,168 | 18,157 | ||||||||||||
Amortization of purchased intangibles | 1,986 | 2,059 | 3,988 | 4,110 | ||||||||||||
Capitalization of internal-use software | (243 | ) | (69 | ) | (1,033 | ) | (209 | ) | ||||||||
Amortization of internal-use software | 159 | 185 | 280 | 362 | ||||||||||||
Deferred compensation associated with Zinc Ahead acquisition | 130 | 730 | 267 | 2,143 | ||||||||||||
Operating income on a non-GAAP basis | $ | 52,310 | $ | 36,741 | $ | 102,907 | $ | 66,191 | ||||||||
Operating margin on a GAAP basis | 22.1 | % | 18.1 | % | 22.9 | % | 16.6 | % | ||||||||
Stock-based compensation expense | 8.0 | 7.6 | 7.7 | 7.2 | ||||||||||||
Amortization of purchased intangibles | 1.2 | 1.6 | 1.2 | 1.6 | ||||||||||||
Capitalization of internal-use software | (0.1 | ) | — | (0.3 | ) | — | ||||||||||
Amortization of internal-use software | 0.1 | 0.1 | 0.1 | 0.1 | ||||||||||||
Deferred compensation associated with Zinc Ahead acquisition | 0.1 | 0.6 | 0.1 | 0.9 | ||||||||||||
Operating margin on a non-GAAP basis | 31.4 | % | 28.0 | % | 31.7 | % | 26.4 | % | ||||||||
Net income on a GAAP basis | $ | 37,844 | $ | 12,958 | $ | 73,867 | $ | 25,467 | ||||||||
Stock-based compensation expense | 13,380 | 10,014 | 25,168 | 18,157 | ||||||||||||
Amortization of purchased intangibles | 1,986 | 2,059 | 3,988 | 4,110 | ||||||||||||
Capitalization of internal-use software | (243 | ) | (69 | ) | (1,033 | ) | (209 | ) | ||||||||
Amortization of internal-use software | 159 | 185 | 280 | 362 | ||||||||||||
Deferred compensation associated with Zinc Ahead acquisition | 130 | 730 | 267 | 2,143 | ||||||||||||
Income tax effect on non-GAAP adjustments | (17,397 | ) | (3,549 | ) | (33,406 | ) | (6,529 | ) | ||||||||
Net income on a non-GAAP basis | $ | 35,859 | $ | 22,328 | $ | 69,131 | $ | 43,501 | ||||||||
Net income allocated to participating securities on a GAAP basis | $ | — | $ | (1 | ) | $ | — | $ | (2 | ) | ||||||
Net income allocated to participating securities from non-GAAP adjustments | — |
(1 |
) |
— |
(1 |
) |
||||||||||
Net income allocated to participating securities on a non-GAAP basis | — |
(2 |
) |
|
— |
(3 |
) | |||||||||
Net income attributable to common stockholders on a non-GAAP basis | $ | 35,859 | $ |
22,326 |
$ | 69,131 | $ |
43,498 |
||||||||
Diluted net income per share on a GAAP basis | $ | 0.25 | $ | 0.09 | $ | 0.48 | $ | 0.17 | ||||||||
Stock-based compensation expense | 0.09 | 0.07 | 0.16 | 0.12 | ||||||||||||
Amortization of purchased intangibles | — | 0.01 | 0.03 | 0.03 | ||||||||||||
Capitalization of internal-use software | — | — | (0.01 | ) | — | |||||||||||
Amortization of internal-use software | — | — | — | — | ||||||||||||
Deferred compensation associated with Zinc Ahead acquisition | — | — | — | 0.02 | ||||||||||||
Income tax effect on non-GAAP adjustments | (0.11 | ) | (0.02 | ) | (0.21 | ) | (0.04 | ) | ||||||||
Diluted net income per share on a non-GAAP basis | $ | 0.23 | $ | 0.15 | $ | 0.45 | $ | 0.30 |
CONTACT:
Investor Relations Contact:
Veeva Systems Inc.
Rick Lund, 925-271-9816
ir@veeva.com
or
Media Contact:
Veeva Systems Inc.
Roger Villareal, 925-264-8885
pr@veeva.com