Shares of Veeva Systems, Inc. (VEEV) surged more than seven percent in extended trading on Tuesday after the cloud-based software maker reported results for the third quarter that topped analysts' expectations.
The company also provided earnings and revenue forecast for the fourth quarter, above Street view, and raised outlook for the full-year 2014.
The company reported a profit for the quarter that increased from last year, reflecting improved operating margins and strong double-digit revenue growth.
"We continue to deliver on our vision of becoming the leading industry cloud provider for life sciences. In the quarter, we saw strength in existing and new areas such as multichannel CRM and Vault. In Vault, we now have more than 100 customers and our first-ever Veeva R&D Summit was the largest content management event for life sciences this year," CEO Peter Gassner said in a statement.
The Pleasanton, California-based leader in cloud-based software for the global life sciences industry, reported net income of $10.20 million or $0.07 per share for the third quarter, higher than $6.39 million or $0.05 per share in the prior-year quarter.
Excluding items, adjusted net income for the quarter was $13.60 million or $0.09 per share, compared to $7.56 million or $0.06 per share in the year-ago quarter.
On average, nine analysts polled by Thomson Reuters expected the company to report earnings of $0.08 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter surged 52 percent to $83.8 million from $54.98 million in the same quarter last year, and topped eight Wall Street analysts' consensus estimate of $78.96 million.
Subscription services revenues surged 58 percent to $61.44 million, and professional services and other revenues grew to $22.39 million from $16.04 million in the prior-year quarter.
Operating margin for the quarter expanded 560 basis points to 23.8 percent as gross margins improved 260 basis points to 63.7 percent from last year.
"In the third quarter, we delivered strong financial results across the board. I am particularly pleased that the business added over $40 million of cash to the balance sheet in the quarter," CFO Tim Cabral stated.
Looking ahead to the fourth quarter, the company expects adjusted earnings in a range of $0.08 to $0.09 per share, on projected revenues between $84.5 million and $85.5 million. Analysts currently project earnings of $0.07 per share on quarterly revenues of $81.62 million.
For fiscal 2014, Veeva raised adjusted earnings guidance to a range of $0.33 to $0.34 per share from the prior forecast of $0.30 to $0.31 per share. Revenues are now expected between $310.7 million and $311.7 million, up from the previous projection between $300 million and $303 million.
Street is currently looking for full-year 2014 earnings of $0.31 per share on annual revenues of $302.90 million.
VEEV closed Tuesday's regular trading session at $28.84, up $0.14 or 0.49% on a volume of 1.49 million shares. The stock surged a further $2.16 or 7.49% in after-hours trading.
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