Veeva spent $222.9 million on research and development in the three months ended July 31, up 15.7% from the comparable period. The company said $24 million of that increase came from employee compensation-related costs, a reminder that the product build is not free, even in a software business with a 75% gross margin.

The headline numbers still have plenty of lift. Revenue rose 17.6% to $928.0 million, operating income climbed 40.4% to $275.0 million, and operating margin widened from 24.8% to 29.6%. The less tidy part is where some of that margin expansion came from: general and administrative expense fell 26%, largely because last year included a litigation settlement charge.

Management also credited existing customers using more of the company’s products and annual inflation adjustments for subscription growth.

"The increase in subscription revenues attributable to R&D and Quality Solutions and Commercial Solutions for the three and six months ended July 31, 2026 was driven by the expanding use by existing customers and higher prices in connection with our annual inflation adjustment for our products."

Veeva, 10-Q, Aug. 27, 2026

That puts the growth engine in two buckets: more usage from the installed base and higher prices. Revenue grew slightly faster than research and development spending, while gross margin slipped to 75.0% from 75.3%, so the operating-margin jump did not come from broader gross-margin expansion.

The largest accounting comparison sits below gross profit. Veeva’s G&A expense dropped to $71.3 million from $95.8 million, and the company attributes the decrease to a $31 million litigation settlement-related charge recorded in the comparable three-month period.

"The decrease in general and administrative expenses for the three and six months ended July 31, 2026 was primarily due to $31 million in litigation settlement-related charges that was incurred in the quarter ended July 31, 2025."

Veeva, 10-Q, Aug. 27, 2026

The expense line is lower this year, but the comparison is doing some of the work. Veeva’s stock compensation also rose 12.2% to $136.8 million, and accounts receivable increased 17.7% to $496.7 million, nearly matching the pace of reported revenue growth. Neither figure explains the margin change by itself, but both matter for judging how much of the operating improvement converts into durable economics.

Cash generation improved too. Operating cash flow rose 22.4% to $1.4 billion, which management attributed to increased sales and related collections, plus lower income-tax payments tied to the OBBBA. Cash on hand fell 6.1% to $1.8 billion as purchases of short-term investments and the Ostro acquisition used cash, partly offset by maturities and sales of investments.

The broader record shows annual revenue reached $3.2 billion in the latest fiscal year, with a 28.7% operating margin. But the valuation leaves less room for a merely mechanical reading. At the latest close of $245.10, Veeva carried a 45.0x P/E and a 12.4x EV-to-sales multiple.

Veeva’s next quarterly report will provide the next comparable G&A line after the litigation charge, alongside another read on receivables and operating cash flow.

Veeva is growing faster, but this filing leaves part of the margin expansion tied to an unusually easy legal-cost comparison.

Source: Veeva’s 10-Q filed Aug. 27, 2026, for the three months ended July 31, 2026.