What happened
Shares of Veeva Systems (VEEV 3.20%) are making big gains in Thursday's daily trading session following better-than-expected earnings results. The healthcare software company's share price was up roughly 15% as of 10:30 a.m. ET, according to data from S&P Global Market Intelligence.
Veeva published results for the first quarter of its 2024 fiscal year, which ended April 30, after the market closed yesterday. The company recorded a profit of $0.91 per share on revenue of $526.3 million and beat the average analyst estimate's call for per-share earnings of $0.79 on sales of $515.86 million.
So what
Veeva's revenue came in roughly 4% higher year over year in the first quarter. Subscription services revenue rose 3% compared to the prior-year period to hit $414.5 million, and sales for its professional-services-and-other segment climbed roughly 9% to hit $111.9 million.
While non-GAAP (generally accepted accounting principles) adjusted net income for the period fell roughly 7% year over year to come in at $147.9 million, GAAP net income rose 31% compared to the prior-year period to reach $131.5 million.
Now what
In addition to delivering better-than-expected Q1 results, Veeva also issued guidance that topped the market's expectations. The company is guiding for earnings between $1.12 per share and $1.13 per share on revenue between $580 million and $582 million in the second quarter. Meanwhile, the average analyst estimate had targeted per-share earnings of $1.07 on sales of $580.31 million.
For the full-year period, management expects earnings per share of $4.59 on revenue between $2.36 billion and $2.37 billion. The profit target came in significantly ahead of Wall Street's call for earnings of $4.32 per share on revenue of $2.36 billion.
VEEV PE Ratio (Forward) data by YCharts
On the heels of today's rally, Veeva Systems now trades at roughly 44 times this year's expected earnings. While the company has a growth-dependent valuation, its strong earnings performance in Q1 and impressive guidance suggest the business is heading in the right direction.
