Life sciences-focused cloud computing solutions provider Veeva (NYSE: VEEV) recently announced its first quarter results. The company continued to outpace market expectations during the quarter.

Veeva’s Financials

Veeva’s first quarter revenues grew 22% to $195.5 million, ahead of the Street’s forecast of $189.2 million. Adjusted EPS of $0.33 was also ahead of the market’s forecast of $0.30 for the quarter.

By segment, revenues from subscription services grew 21% to $156 million. Billings for the quarter came in at $209.7 million, ahead of the Street’s estimate of $201.7 million. Revenues from professional services grew 29% over the year to $39.5 million.

For the current quarter, Veeva forecast revenues of $203-$204 million with an adjusted EPS of $0.33-$0.34 per share. Veeva expects to end the current year with revenues of $826-$830 million and an EPS of $1.36-$1.38. The market was looking for revenues of $807 million and an adjusted profit of $1.01 per share. The Street was forecasting revenues of $203.6 million for the quarter with an EPS of $0.34. It expects the company to end the year with revenues of $829.3 million and an EPS of $1.37.

Veeva’s Growth Plan

Veeva continued to drive growth by upgrading its product offering. It recently announced the release of Veeva Nitro, a data warehouse built for the commercial side of life sciences. Veeva Nitro provides a ready-to-use cloud solution that improves over time. It eliminates the time and effort needed to build a custom data warehouse solution. Nitro is also Veeva’s attempt to embrace AI. It sets up customers to fully leverage AI in the future. It offers a next-generation data warehouse built specifically for commercial life sciences. It includes a pre-built data model and pre-built connectors for key data sources so companies can use the solution to quickly support their global and regional needs from analytics to reporting to AI. It is Veeva’s first true analytics application. Nitro is currently available in Japan and will be available in North America by the end of 2018.

Veeva also recently introduced Veeva Vault Training, a new cloud application to simplify role-based training across life sciences organizations. Veeva believes that by providing the training solution in conjunction with Veeva Vault QMS and Veeva Vault QualityDocs, it will deliver a unified suite of quality applications on a single cloud platform. Vault Training will enable life sciences companies to organize, assign, and track content and information for training the right resources.

Veeva has managed to build a substantial business in the life sciences industry. Its latest offering of Nitro is expected to help it lay the ground work for the use of AI in the sector. It is counting on providing a prebuilt data model and connectors to data sources so analytics can go beyond regional to global and cover analytics and ultimately AI. My understanding is that Veeva aims to address as many aspects of the Life Sciences industry’s IT workflows as possible. It is deeply entrenched in key customers, and each is a substantial up-sell opportunity. What are the two or three initiatives that will drive the company from ~$1 billion in revenue to ~$10 billion in revenue? This is the key question facing the company and its product strategy.

The market is pleased with Veeva’s performance. Its stock is trading at $75.37 with a market capitalization of $10.8 billion. It had climbed to a 52-week high of $85 earlier this month. The stock has recovered from the 52-week low of $52.17 it had fallen to in December last year.