Veeva Systems Inc. · NYSE:VEEV
Veeva Systems — Investor Day (November 2022)
57 slides from Veeva Systems's investor day presentation, Nov 3, 2022
Slide 1: Analyst and Investor Day
Analyst and Investor Day November 3, 2022
Slide 2: 2022 Veeva Analyst and Investor Day
2022 Veeva Analyst and Investor Day Thursday, November 3 Veeva Vision and Strategy : Peter Gassner, Founder & CEO Financial Update : Brent Bowman, CFO Break Paul Shawah, EVP Commercial Strategy Partnering to Advance the Industry : Cindy Hoots, AstraZeneca Q&A Copyright © Veeva Systems 2022
Slide 3: Safe Harbor and Other Information
Safe Harbor and Other Information This presentation and associated commentary contain forward-looking statements regarding Veeva’s future performance, market size and opportunity, and financial outlook, including, in particular, guidance provided as of August 31, 2022 about Veeva’s expected future f
Slide 4: Peter Gassner
Peter Gassner Founder & CEO
Slide 5: Highlights
Highlights Consistent Execution Durable Business Model Ahead of 2025 Targets Long Runway of Growth Copyright © Veeva Systems 2022
Slide 6: Vision and Values
Vision Building the Industry Cloud for Life Sciences Values Do the Right Thing Customer Success Employee Success Speed A Public Benefit Corporation
Slide 7: Our Industry Cloud Segments
Our Industry Cloud Segments Pharmaceuticals Consumer Products and Biotech MedTech 93% 4% 3% S O F T WA R E D ATA C O N S U LT I N G Approximates 2Q’23 revenue mix Copyright © Veeva Systems 2022
Slide 8: Geographies
Geographies North America Europe Asia, LatAm, ROW 58% 28% 14% Approximates 2Q’23 revenue mix Copyright © Veeva Systems 2022
Slide 9: Becoming Essential to a Large & Growing Industry
Becoming Essential to a Large & Growing Industry Pharma, Biotech, Medtech Industry Copyright © Veeva Systems 2022
Slide 10: Industry Cloud for Life Sciences
Industry Cloud for Life Sciences Software • Data • Consulting Veeva Veeva Veeva DEVELOPMENT COMMERCIAL DATA CLOUD CLOUD CLOUD BUSINESS CONSULTING Copyright © Veeva Systems 2022
Slide 11: Long Runway Ahead in Life Sciences
Long Runway Ahead in Life Sciences Product Suite Maturity and Market Share Veeva Product Quadrant High Product Maturity Market Share High Copyright © Veeva Systems 2022
Slide 12: Commercial Solutions
LV Commercial Solutions
Slide 13: Veeva Commercial Solutions
Veeva Commercial Solutions Delivering Commercial Excellence Commercial Data Business Cloud Cloud Consulting COMMON DATA ARCHITECHTURE Copyright © Veeva Systems 2022
Slide 14: CRM Suite
Core CRM Engage CRM Suite CLM Events Foundation for Digital Engagement Approved Email Align Trusted Market Leader Engagement + Content 15 Years of Innovation
Slide 15: Commercial Content
Content Creation Commercial Content Review and Approval Vault PromoMats Digital Asset Management Vault MedComms Trusted Market Leader Modular Content Global Reuse
Slide 16: Crossix
Measurement Crossix Optimization Marketing Analytics For the U.S. Market Audience Segments 300M Patients Privacy-safe Crossix Data Platform
Slide 17: Compass
Patient Data Compass Prescriber DataF Modern Approach to Data For the U.S. Market Sales DataF Better Data Better Delivery Crossix Data Platform F Reflects products planned for availability in the future
Slide 18: Link
Link Key People Scientific Awareness Applications for Key AccountsF Medical InsightsF Real-time Intelligence Real-time Intelligence Link Platform Innovating F Reflects products planned for availability in the future
Slide 19: R&D Solutions
LV R&D Solutions
Slide 20: Vault Platform
Operating System for Product Development Clinical Clinical Regulatory Quality Safety Data Operations VAULT CONNECTIONS VAULT PLATFORM Copyright © Veeva Systems 2022
Slide 21: Clinical Operations
eTMF Payments Clinical Operations CTMS Study Startup Foundation for Trial Execution Site Connect Study Training More Efficient Trials 450 Customers Transforming Site Engagement
Slide 22: Clinical Data Management
Clinical Data EDC ePRO Management RTSM CDB Modernizing Data Management 400 EDC Trials Foundation for Digital Trials Complete and Concurrent Data
Slide 23: RIM Suite
RIM Suite Submissions Archive Complete Regulatory System Publishing Registrations End-to-End Efficiency & Compliance 350 Customers Complete & Ready
Slide 24: Quality Suite
QualityDocs LearnGXP Quality Suite QMS LIMS Unifying Quality Management Training Validation Management Unified & Connected Quality Quality & Manufacturing 500 Customers
Slide 25: Safety Suite
Safety Safety Suite SafetyDocs Comprehensive Safety Management SignalF Modern Cloud System End-to-End Safety Management Unified & Connected F Reflects products planned for availability in the future
Slide 26: Long Runway Ahead in Life Sciences
Long Runway Ahead in Life Sciences Product Suite Maturity and Market Share Veeva Product Quadrant High Product Maturity Market Share High Copyright © Veeva Systems 2022
Slide 27: Product Growth & Innovation
PRODUCT GROWTH & INNOVATION Power of Veeva Platforms
Slide 28: Veeva Platforms
Veeva Platforms VAULT LINK CROSSIX DATA PLATFORM PLATFORM PLATFORM Enterprise Apps Data Applications Patient Data, Content & Data Real-time Intelligence Privacy-safe Copyright © Veeva Systems 2022
Slide 29: Platforms by % of Subscription Revenue
Platforms by % of Subscription Revenue 10 % Other Platforms 60 % Vault Platform 30 % Salesforce Platform Approximates 2Q’23 revenue mix Copyright © Veeva Systems 2022
Slide 30: Execution Matters Most: The Veeva Way
Execution Matters Most: The Veeva Way Innovation and Customer Product Excellence Success Values Clear and Operating Model Strong Correct Growth and Markets Trust Profitability Copyright © Veeva Systems 2022
Slide 31: Consistent Execution with a Long-term View
Consistent Execution with a Long-term View 2019 GOAL Looking Ahead to 2015 GOAL $3B 2030 $1B in 2025 in 2020 $1B One Year Ahead in 2019 of Plan Copyright © Veeva Systems 2022
Slide 32: Highlights
Highlights Consistent Execution Durable Business Model Ahead of 2025 Targets Long Runway of Growth Copyright © Veeva Systems 2022
Slide 33: Brent Bowman
Brent Bowman CFO
Slide 34: Q3'23 Guidance
Q3’23 Guidance Guidance Total Revenue $545-547 million Subscription Revenue ~$439 million Services Revenue $106-108 million Non-GAAP Operating Income $209-211 million Non-GAAP Fully Diluted Net Income per Share $1.07-1.08 Calculated Billings ~$365 million Guidance issued on August 31, 2022. Our Q3’2
Slide 35: Consistent History of Strong Growth and Profitability
Consistent History of Strong Growth and Profitability Revenue $2.145B Non-GAAP Operating Income1 $1.85B $1.47B $1.10B $862M $820M $759M $691M $551M $583M $412M $307M $220M $173M FY172 FY182 FY19 FY203 FY213 FY22 FY23E4 Fiscal Year Ending January 31 ¹ A reconciliation of GAAP to non-GAAP measures is
Slide 36: Veeva's Operating Model
Veeva’s Operating Model Innovation and Customer Product Excellence Success Values Clear and Operating Model Strong Correct Growth and Markets Trust Profitability Copyright © Veeva Systems 2022
Slide 37: Disciplined Approach to Spending and Profitability
Disciplined Approach to Spending and Profitability Q2’23 Total Spend1 as a % of Total Revenue Services Revenue and Gross Margin1 20% 34% 31% 18% 29% 30% 28% 15% 14% Revenue 11% 12% Gross Margin 10% 367 8% 286 5% 208 168 131 0% Cost of Cost of R&D S&M G&A Subscription Services FY18 FY19 FY20 FY21 FY2
Slide 38: Financial Performance Looking Forward
Financial Performance Looking Forward Durable Profitable Growth ••• ••• ••• Customer Relationships Disciplined Execution Innovation Copyright © Veeva Systems 2022
Slide 39: Long Runway Ahead in Life Sciences
Long Runway Ahead in Life Sciences Product Suite Maturity and Market Share Veeva Product Quadrant High Product Maturity Market Share High Copyright © Veeva Systems 2022
Slide 40: TAM – Significant Room to Grow
TAM – Significant Room to Grow $13B+ TAM $3B Data Cloud Commercial $6B+ $3B Commercial Cloud $1B CP&C* R&D $3B Clinical $7B+ $3B Quality, Regulatory & Safety FY23E Revenue1 z $2.145B *CP&C includes Veeva’s CPG, Cosmetics, and Chemicals businesses Fiscal Year Ending January 31 1 Based on the high end
Slide 41: Tracking About One Year Ahead of 2025 Targets
Tracking About One Year Ahead of 2025 Targets Metric CY 2025 Targets Total Revenue Run Rate $3B+ Commercial ~$1.2B R&D ~$1.8B Non-GAAP Op Margin 35%+ We are not able, at this time, to provide GAAP targets for operating margin 2025 because of the difficulty of estimating certain items excluded from n
Slide 42: New Disclosures
New Disclosures Customer Inflation Annual Contracting Adjustment Guidance Copyright © Veeva Systems 2022
Slide 43: Customer Contracting Change
Customer Contracting Change Standardizing Termination for Convenience (TFC) rights Historically Going Forward • Most customer orders had • More orders are multi-year a one-year term, thus TFC Starting in duration rights were not meaningful February 1, 2023 • TFC rights will be • TFC rights differed
Slide 44: Impact of TFC on Subscription Revenue (Timing)
Impact of TFC on Subscription Revenue (Timing) EXAMPLE 1: Multi-Year Ramping Deal without TFC Invoice/Billings Subscription Revenue 6 6 6 Revenue is recognized ratably over the duration of 4 4 4 4 the committed term 2 Year 1 Year 2 Year 3 Renewal EXAMPLE 2: Multi-Year Ramping Deal with TFC Invoice/B
Slide 45: Key Takeaways - TFC Change
Key Takeaways - TFC Change Consistent TFC treatment of customers with MYR deals Impact to FY24 • ~$60M one-time reduction to revenue for deals without TFC, resulting in a ~150bps headwind to non-GAAP operating margin With continued execution, we do not expect an impact to: • Cash flows • Billings •
Slide 46: Inflation Adjustment
Inflation Adjustment US CPI (%) Veeva Annual Inflation Adjustment 8.0 Effective April 1, 2023 4.7 Lower of CPI 1.8 1.2 or 4% 2019 2020 2021 2022E Copyright © Veeva Systems 2022
Slide 47: Expectations for FY24 Guidance
Expectations for FY24 Guidance Historically Going Forward • Initial limited Guidance on Q3’FY • Full Guidance on Q4’FY • Full Guidance on Q4’FY Copyright © Veeva Systems 2022
Slide 48: Durable Business Model
Durable Business Model Software • Data • Consulting Consistent Ahead of Long Runway Execution 2025 Targets of Growth Copyright © Veeva Systems 2022
Slide 49: Cindy Hoots
Cindy Hoots Chief Digital Officer & CIO
Slide 50: Appendix
Appendix
Slide 51: Continued Momentum in R&D
Continued Momentum in R&D Avg. Products 2.07 2.25 2.35 2.61 2.85 2.92 Per Customer: 945 860 664 526 480 538 423 389 317 346 213 281 197 223 168 125 95 183 206 76 107 18 47 67 FY18 FY19 FY20 FY21 FY22 Q2FY23 Customers with: 5 or More Products 3-4 Products 2 Products or Fewer Copyright © Veeva Systems
Slide 52: Expanding Our Commercial Leadership
Expanding Our Commercial Leadership Avg. Products 2.93 3.25 3.51 3.95 4.04 4.07 Per Customer: 671 653 572 523 341 454 335 417 297 306 277 284 221 229 194 167 150 122 81 97 101 11 27 50 FY18 FY19 FY20 FY21 FY22 Q2FY23 Customers with: 8 or More Products 4-7 Products 3 Products or Fewer Copyright © Vee
Slide 53: Statement Regarding Use of Non-GAAP Financial Measures
Statement Regarding Use of Non-GAAP Financial Measures We provide the following non-GAAP measures, which we define as financial information that has not been prepared in accordance with generally accepted accounting principles in the United States, or GAAP: Non-GAAP gross margin, non-GAAP operating
Slide 54: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures in millions FY'17* FY'18* FY'19 FY'20 FY'21 FY'22 Operating income on a GAAP basis $ 120.7 $ 157.9 $ 222.9 $ 286.2 $ 377.8 $ 505.5 Stock-based compensation expense 40.8 54.0 76.4 115.9 185.0 234.6 Amortization of purchased intangibles 8.2 7.8 7.0 10.1 20.0
Slide 55: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures Q2 FY'23 % of Revenue Cost of subscription services revenue on a GAAP basis $ 64.0 12% Stock-based compensation expense (1.7) Amortization of purchased intangibles (1.1) Cost of subscription services revenue on a non-GAAP basis $ 61.2 11% Q2 FY'23 % of Rev
Slide 56: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures FY'18 FY'19 FY'20 FY'21 FY'22 Gross margin on professional services and other revenues on a GAAP basis 23.0 % 23.5 % 19.6 % 21.4 % 24.0 % Stock-based compensation expense 6.5 % 6.3 % 8.4 % 9.7 % 9.9 % Amortization of purchased intangibles -% -% 0.1 % 0.2 %
Slide 57: Veeva Product Area Definitions
Veeva Product Area Definitions Commercial Solutions R&D Solutions Commercial Cloud Data Cloud Vault Clinical Suite Vault Quality Suite Veeva CRM Suite Veeva Compass Clinical Data • Vault QMS • Veeva CRM • Patient • Vault EDC • Vault Product Surveillance • Veeva CLM • PrescriberF • Veeva RTSM • Vault