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Veeva Announces Fiscal 2025 Third Quarter Results

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2 years ago

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Total Revenues of $699.2M, up 13% Year Over Year
Subscription Services Revenues of $580.9M, up 17% Year Over Year

PLEASANTON, Calif., Dec. 5, 2024 /PRNewswire/ — Veeva Systems Inc. (NYSE: VEEV), a leading provider of industry cloud solutions for the global life sciences industry, today announced results for its third quarter ended October 31, 2024.

“It was a great quarter of innovation and excellent execution across the board,” said CEO Peter Gassner. “Especially significant was the hard work for the long term. We deepened a number of large, highly strategic relationships and are set to deliver the next generation of CRM this month with Vault CRM Suite to connect sales, marketing, and medical – a first for the industry.”

Fiscal 2025 Third Quarter Results:

Revenues(1): Total revenues for the third quarter were $699.2 million, up from $616.5 million one year ago, an increase of 13% year over year. Subscription services revenues for the third quarter were $580.9 million, up from $494.9 million one year ago, an increase of 17% year over year.

Operating Income and Non-GAAP Operating Income(1)(2): Third quarter operating income was $181.4 million, compared to $128.5 million one year ago, an increase of 41% year over year. Non-GAAP operating income for the third quarter was $304.0 million, compared to $234.6 million one year ago, an increase of 30% year over year.

Net Income and Non-GAAP Net Income(1)(2): Third quarter net income was $185.8 million, compared to $135.2 million one year ago, an increase of 37% year over year. Non-GAAP net income for the third quarter was $288.3 million, compared to $218.7 million one year ago, an increase of 32% year over year.

Net Income per Share and Non-GAAP Net Income per Share(1)(2): For the third quarter, fully diluted net income per share was $1.13, compared to $0.83 one year ago, while non-GAAP fully diluted net income per share was $1.75, compared to $1.34 one year ago.

“We delivered results ahead of guidance on all metrics, reflecting our operational discipline and the durability of our model,” said CFO Brian Van Wagener. “With a clear product strategy, focused execution, and large market opportunity we are well positioned for strong growth and profitability for many years to come.”

Recent Highlights:

Leading in CRM with Innovation, Execution, and Customer Success Focus – Leadership in CRM continued with a focus on customer success and product excellence. More than 30 customers are now live on Vault CRM and the seven migrations from Veeva CRM to Vault CRM are on track for completion by year end. In November, the fourth top 20 biopharma committed to Vault CRM as its commercial foundation. And as planned, this month the latest release of Vault CRM will include the full functionality of Veeva CRM and additional new capabilities, marking the availability of the next generation of CRM for the industry.

New AI Capabilities Coming to Commercial – Veeva announced three new AI innovations planned for availability in late 2025. Coming in Vault CRM is CRM Bot, a GenAI assistant, and Voice Control, a voice interface leveraging Apple Intelligence. The company also announced MLR Bot for Vault PromoMats, which uses a Veeva-hosted large language model to speed review and approval by checking quality and content of promotional materials.

Long-term Focus on the Major Quality Opportunity – With the addition of more than 25 customers in the quarter, now more than 600 customers have selected at least one of the seven Vault Quality Suite applications available today. This milestone, along with the continued expansion of current customers with additional Quality applications, is the result of Veeva’s long-term view to building clear leadership in large markets through product excellence and customer success.

Financial Outlook:

Veeva is providing guidance for its fiscal fourth quarter ending January 31, 2025 as follows:

Total revenues between $696 and $699 million.

Non-GAAP operating income of about $275 million(3).

Non-GAAP fully diluted net income per share of approximately $1.57(3).

Veeva is providing updated guidance for its fiscal year ending January 31, 2025 as follows:

Total revenues between $2,722 and $2,725 million.

Non-GAAP operating income of about $1,120 million(3).

Non-GAAP fully diluted net income per share of approximately $6.44(3).

Conference Call Information

Prepared remarks and an investor presentation providing additional information and analysis can be found on Veeva’s investor relations website at ir.veeva.com. Veeva will host a Q&A conference call at 2:00 p.m. PT today, December 5, 2024, and a replay of the call will be available on Veeva’s investor relations website.

What:

Veeva Systems Fiscal 2025 Third Quarter Results Conference Call

When:

Thursday, December 5, 2024

Time:

2:00 p.m. PT (5:00 p.m. ET)

Online Registration:

https://registrations.events/direct/Q4I86021395 

Webcast:

ir.veeva.com

___________

(1) The customer contracting change that standardized termination for convenience (TFC) rights in our master subscription agreements resulted in a change in the timing of revenue for certain customer contracts and reduced revenues, operating income and non-GAAP operating income, and net income and non-GAAP net income in the third quarter of fiscal 2024.

(2) This press release uses non-GAAP financial metrics that are adjusted for the impact of various GAAP items. See the section titled “Non-GAAP Financial Measures” and the tables entitled “Reconciliation of GAAP to Non-GAAP Financial Measures” below for details.

(3) Veeva is not able, at this time, to provide GAAP targets for operating income and fully diluted net income per share for the fourth fiscal quarter ending January 31, 2025 or the fiscal year ending January 31, 2025 because of the difficulty of estimating certain items excluded from non-GAAP operating income and non-GAAP fully diluted net income per share that cannot be reasonably predicted, such as charges related to stock-based compensation expense. The effect of these excluded items may be significant.

About Veeva Systems
Veeva is the global leader in cloud software for the life sciences industry. Committed to innovation, product excellence, and customer success, Veeva serves more than 1,000 customers, ranging from the world’s largest pharmaceutical companies to emerging biotechs. As a Public Benefit Corporation, Veeva is committed to balancing the interests of all stakeholders, including customers, employees, shareholders and the industries it serves. For more information, visit veeva.com.

Veeva uses its ir.veeva.com website as a means of disclosing material non-public information, announcing upcoming investor conferences, and for complying with its disclosure obligations under Regulation FD. Accordingly, you should monitor our investor relations website in addition to following our press releases, SEC filings, and public conference calls and webcasts.

Forward-looking Statements
This release contains forward-looking statements regarding Veeva’s expected future performance and, in particular, includes quotes from management and guidance, provided as of December 5, 2024, about Veeva’s expected future financial results. Estimating guidance accurately for future periods is difficult. It involves assumptions and internal estimates that may prove to be incorrect and is based on plans that may change. Hence, there is a significant risk that actual results could differ materially from the guidance we have provided in this release and we have no obligation to update such guidance. There are also numerous risks that have the potential to negatively impact our financial performance, including issues related to the performance, availability, security, or privacy of our products, competitive factors, customer decisions and priorities, events that impact the life sciences industry, general macroeconomic and geopolitical events (including inflationary pressures, changes in interest rates, currency exchange fluctuations and impacts related to Russia’s invasion of Ukraine and the Israel-Hamas conflict), and issues that impact our ability to hire, retain and adequately compensate talented employees. We have summarized what we believe are the principal risks to our business in a section titled “Summary of Risk Factors” on pages 36 and 37 in our filing on Form 10-Q for the period ended July 31, 2024 which you can find here. Additional details on the risks and uncertainties that may impact our business can be found in the same filing on Form 10-Q and in our subsequent SEC filings, which you can access at sec.gov. We recommend that you familiarize yourself with these risks and uncertainties before making an investment decision.

Investor Relations Contact:

Media Contact:

Gunnar Hansen

Maria Scurry

Veeva Systems Inc.

Veeva Systems Inc.

267-460-5839

781-366-7617

ir@veeva.com

pr@veeva.com 

 

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

October 31,
2024

January 31,
2024

Assets

Current assets:

Cash and cash equivalents

$      1,044,511

$         703,487

Short-term investments

4,018,475

3,324,269

Accounts receivable, net

255,817

852,172

Unbilled accounts receivable

45,472

36,365

Prepaid expenses and other current assets

82,885

86,918

Total current assets

5,447,160

5,003,211

Property and equipment, net

55,695

58,532

Deferred costs, net

22,515

23,916

Lease right-of-use assets

60,325

45,602

Goodwill

439,877

439,877

Intangible assets, net

48,527

63,017

Deferred income taxes

322,652

233,463

Other long-term assets

56,102

43,302

Total assets

$      6,452,853

$      5,910,920

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable

$           31,845

$           31,513

Accrued compensation and benefits

34,634

43,433

Accrued expenses and other current liabilities

30,906

32,980

Income tax payable

10,803

11,862

Deferred revenue

739,657

1,049,761

Lease liabilities

9,156

9,334

Total current liabilities

857,001

1,178,883

Deferred income taxes

475

2,052

Lease liabilities, noncurrent

62,545

46,441

Other long-term liabilities

31,429

38,720

Total liabilities

951,450

1,266,096

Stockholders’ equity:

Common stock

2

2

Additional paid-in capital

2,248,890

1,915,002

Accumulated other comprehensive loss

(6,459)

(10,637)

Retained earnings

3,258,970

2,740,457

Total stockholders’ equity

5,501,403

4,644,824

Total liabilities and stockholders’ equity

$      6,452,853

$      5,910,920

 

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands, except per share data)

(Unaudited)

Three months ended
October 31,

Nine months ended
October 31,

2024

2023

2024

2023

Revenues:

Subscription services(4)

$     580,850

$     494,912

$  1,676,082

$  1,380,095

Professional services and other(5)

118,357

121,593

349,651

352,960

Total revenues

699,207

616,505

2,025,733

1,733,055

Cost of revenues(6):

Cost of subscription services

82,638

74,435

239,577

213,179

Cost of professional services and other

91,751

93,247

279,068

290,184

Total cost of revenues

174,389

167,682

518,645

503,363

Gross profit

524,818

448,823

1,507,088

1,229,692

Operating expenses(6):

Research and development

172,411

161,278

511,551

465,466

Sales and marketing

98,695

96,773

297,524

282,269

General and administrative

72,359

62,283

195,001

187,887

Total operating expenses

343,465

320,334

1,004,076

935,622

Operating income

181,353

128,489

503,012

294,070

Other income, net

60,937

42,187

171,239

111,260

Income before income taxes

242,290

170,676

674,251

405,330

Income tax provision

56,482

35,518

155,738

27,023

Net income

$     185,808

$     135,158

$     518,513

$     378,307

Net income per share:

Basic

$           1.15

$           0.84

$           3.21

$           2.36

Diluted

$           1.13

$           0.83

$           3.15

$           2.32

Weighted-average shares used to compute net income per share:

Basic

161,987

160,768

161,707

160,344

Diluted

164,979

163,761

164,838

163,129

Other comprehensive income:

Net change in unrealized (loss) gain on available-for-sale investments

$          (738)

$       (2,637)

$         5,576

$       (6,100)

Net change in cumulative foreign currency translation loss

(146)

(518)

(1,398)

(309)

Comprehensive income

$     184,924

$     132,003

$     522,691

$     371,898

(4) Includes subscription services revenues from the following product areas:

Veeva Commercial Solutions

$     278,377

$     251,167

$     811,503

$     733,921

Veeva R&D Solutions

302,473

243,745

864,579

646,174

Total subscription services

$     580,850

$     494,912

$  1,676,082

$  1,380,095

(5) Includes professional services and other revenues from the following product areas:

Veeva Commercial Solutions

$       45,855

$       47,899

$     139,695

$     140,082

Veeva R&D Solutions

72,502

73,694

209,956

212,878

Total professional services and other

$     118,357

$     121,593

$     349,651

$     352,960

(6) Includes stock-based compensation as follows:

Cost of revenues:

Cost of subscription services

$         1,696

$         1,604

$         4,892

$         4,857

Cost of professional services and other

12,929

12,943

38,640

39,881

Research and development

48,014

45,711

138,741

129,909

Sales and marketing

21,214

23,460

67,928

67,084

General and administrative

34,006

17,508

71,945

53,109

Total stock-based compensation

$     117,859

$     101,226

$     322,146

$     294,840

 

VEEVA SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Nine months ended
October 31,

2024

2023

Cash flows from operating activities

Net income

$     518,513

$     378,307

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

29,451

24,000

Reduction of operating lease right-of-use assets

8,348

8,885

Accretion of discount on short-term investments

(20,442)

(19,298)

Stock-based compensation

322,146

294,840

Amortization of deferred costs

11,507

12,843

Deferred income taxes

(91,231)

(80,132)

(Gain) loss on foreign currency from mark-to-market derivative

(880)

841

Bad debt expense

415

630

Changes in operating assets and liabilities:

Accounts receivable

595,940

446,921

Unbilled accounts receivable

(9,107)

37,337

Deferred costs

(10,106)

(751)

Prepaid expenses and other current and long-term assets

1,354

(6,806)

Accounts payable

424

(5,502)

Accrued expenses and other current liabilities

(10,240)

(9,572)

Income taxes payable

(1,059)

1,614

Deferred revenue

(321,090)

(228,120)

Operating lease liabilities

(7,131)

(4,263)

Other long-term liabilities

3,695

1,796

Net cash provided by operating activities

1,020,507

853,570

Cash flows from investing activities

Purchases of short-term investments

(2,206,521)

(2,142,068)

Maturities and sales of short-term investments

1,537,874

1,170,881

Long-term assets

(15,799)

(18,461)

Net cash used in investing activities

(684,446)

(989,648)

Cash flows from financing activities

Proceeds from exercise of common stock options

65,104

52,184

Taxes paid related to net share settlement of equity awards

(59,800)

(57,888)

Net cash provided by (used in) financing activities

5,304

(5,704)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(1,346)

(973)

Net change in cash, cash equivalents, and restricted cash

340,019

(142,755)

Cash, cash equivalents, and restricted cash at beginning of period

706,670

889,650

Cash, cash equivalents, and restricted cash at end of period

$  1,046,689

$     746,895

Supplemental disclosures of other cash flow information:

Excess tax benefits from employee stock plans

$         5,160

$       68,575

Non-GAAP Financial Measures
In Veeva’s public disclosures, Veeva has provided non-GAAP measures, which it defines as financial information that has not been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. In addition to its GAAP measures, Veeva uses these non-GAAP financial measures internally for budgeting and resource allocation purposes and in analyzing its financial results. For the reasons set forth below, Veeva believes that excluding the following items provides information that is helpful in understanding its operating results, evaluating its future prospects, comparing its financial results across accounting periods, and comparing its financial results to its peers, many of which provide similar non-GAAP financial measures.

Excess tax benefits. Excess tax benefits from employee stock plans are dependent on previously agreed-upon equity grants to our employees, vesting of those grants, stock price, and exercise behavior of our employees, which can fluctuate from quarter to quarter. Because these fluctuations are not directly related to our business operations, Veeva excludes excess tax benefits for its internal management reporting processes. Veeva management also finds it useful to exclude excess tax benefits when assessing the level of cash provided by operating activities. Given the nature of the excess tax benefits, Veeva believes excluding it allows investors to make meaningful comparisons between our operating cash flows from quarter to quarter and those of other companies.

Stock-based compensation expenses. Veeva excludes stock-based compensation expenses primarily because they are non-cash expenses that Veeva excludes from its internal management reporting processes. Veeva’s management also finds it useful to exclude these expenses when they assess the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods. Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use, Veeva believes excluding stock-based compensation expenses allows investors to make meaningful comparisons between our recurring core business operating results and those of other companies.

Amortization of purchased intangibles. Veeva incurs amortization expense for purchased intangible assets in connection with acquisitions of certain businesses and technologies. Amortization of intangible assets is a non-cash expense and is inconsistent in amount and frequency because it is significantly affected by the timing, size of acquisitions and the inherent subjective nature of purchase price allocations. Because these costs have already been incurred and cannot be recovered, and are non-cash expenses, Veeva excludes these expenses for its internal management reporting processes. Veeva’s management also finds it useful to exclude these charges when assessing the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods. Investors should note that the use of intangible assets contributed to Veeva’s revenues earned during the periods presented and will contribute to Veeva’s future period revenues as well.

Litigation settlement. We exclude costs related to the settlement of certain litigation matters because they are non-recurring and outside the ordinary course of business. Because these costs are unrelated to our day-to-day business operations, we believe excluding them enables more consistent evaluation of our operating results.

Income tax effects on the difference between GAAP and non-GAAP costs and expenses. The income tax effects that are excluded relate to the imputed tax impact on the difference between GAAP and non-GAAP costs and expenses due to stock-based compensation and purchased intangibles for GAAP and non-GAAP measures.

There are limitations to using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures provided by other companies. The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by Veeva’s management about which items are adjusted to calculate its non-GAAP financial measures. Veeva compensates for these limitations by analyzing current and future results on a GAAP basis as well as a non-GAAP basis and also by providing GAAP measures in its public disclosures.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Veeva encourages its investors and others to review its financial information in its entirety, not to rely on any single financial measure to evaluate its business, and to view its non-GAAP financial measures in conjunction with the most directly comparable GAAP financial measures. A reconciliation of GAAP to the non-GAAP financial measures has been provided in the tables below.

VEEVA SYSTEMS INC.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(Dollars in thousands)

(Unaudited)

The following tables reconcile the specific items excluded from GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:

Reconciliation of Net Cash Provided by Operating Activities (GAAP basis to non-GAAP basis)

Three months ended
October 31,

Nine months ended
October 31,

2024

2023

2024

2023

Net cash provided by operating activities on a GAAP basis

$  164,117

$    82,598

$  1,020,507

$  853,570

Excess tax benefits from employee stock plans

(898)

(3,275)

(5,160)

(68,575)

Net cash provided by operating activities on a non-GAAP basis

$  163,219

$    79,323

$  1,015,347

$  784,995

Net cash used in investing activities on a GAAP basis

$  (298,226)

$  (73,324)

$  (684,446)

$  (989,648)

Net cash provided by (used in) financing activities on a GAAP basis

$    12,960

$    (6,889)

$      5,304

$    (5,704)

Reconciliation of Financial Measures (GAAP basis to non-GAAP basis)

Three months ended
October 31,

Nine months ended
October 31,

2024

2023

2024

2023

Cost of subscription services revenues on a GAAP basis

$    82,638

$    74,435

$  239,577

$  213,179

Stock-based compensation expense

(1,696)

(1,604)

(4,892)

(4,857)

Amortization of purchased intangibles

(1,043)

(1,126)

(3,265)

(3,343)

Cost of subscription services revenues on a non-GAAP basis

$    79,899

$    71,705

$  231,420

$  204,979

Gross margin on subscription services revenues on a GAAP basis

85.8 %

85.0 %

85.7 %

84.6 %

Stock-based compensation expense

0.3

0.3

0.3

0.3

Amortization of purchased intangibles

0.1

0.2

0.2

0.2

Gross margin on subscription services revenues on a non-GAAP basis

86.2 %

85.5 %

86.2 %

85.1 %

Cost of professional services and other revenues on a GAAP basis

$    91,751

$    93,247

$  279,068

$  290,184

Stock-based compensation expense

(12,929)

(12,943)

(38,640)

(39,881)

Amortization of purchased intangibles

(139)

(139)

(412)

(411)

Cost of professional services and other revenues on a non-GAAP basis

$    78,683

$    80,165

$  240,016

$  249,892

Gross margin on professional services and other revenues on a GAAP basis

22.5 %

23.3 %

20.2 %

17.8 %

Stock-based compensation expense

10.9

10.6

11.1

11.3

Amortization of purchased intangibles

0.1

0.2

0.1

0.1

Gross margin on professional services and other revenues on a non-GAAP basis

33.5 %

34.1 %

31.4 %

29.2 %

Gross profit on a GAAP basis

$  524,818

$  448,823

$  1,507,088

$  1,229,692

Stock-based compensation expense

14,625

14,547

43,532

44,738

Amortization of purchased intangibles

1,182

1,265

3,677

3,754

Gross profit on a non-GAAP basis

$  540,625

$  464,635

$  1,554,297

$  1,278,184

Gross margin on total revenues on a GAAP basis

75.1 %

72.8 %

74.4 %

71.0 %

Stock-based compensation expense

2.1

2.4

2.1

2.6

Amortization of purchased intangibles

0.1

0.2

0.2

0.2

Gross margin on total revenues on a non-GAAP basis

77.3 %

75.4 %

76.7 %

73.8 %

Research and development expense on a GAAP basis

$  172,411

$  161,278

$  511,551

$  465,466

Stock-based compensation expense

(48,014)

(45,711)

(138,741)

(129,909)

Amortization of purchased intangibles

(29)

(29)

(85)

(85)

Research and development expense on a non-GAAP basis

$  124,368

$  115,538

$  372,725

$  335,472

Three months ended
October 31,

Nine months ended
October 31,

2024

2023

2024

2023

Sales and marketing expense on a GAAP basis

$    98,695

$    96,773

$  297,524

$  282,269

Stock-based compensation expense

(21,214)

(23,460)

(67,928)

(67,084)

Amortization of purchased intangibles

(3,544)

(3,555)

(10,558)

(10,550)

Sales and marketing expense on a non-GAAP basis

$    73,937

$    69,758

$  219,038

$  204,635

General and administrative expense on a GAAP basis

$    72,359

$    62,283

$  195,001

$  187,887

Stock-based compensation expense

(34,006)

(17,508)

(71,945)

(53,109)

Amortization of purchased intangibles

(57)

(57)

(170)

(169)

Litigation settlement

—

—

(5,000)

—

General and administrative expense on a non-GAAP basis

$    38,296

$    44,718

$  117,886

$  134,609

Operating expense on a GAAP basis

$  343,465

$  320,334

$  1,004,076

$  935,622

Stock-based compensation expense

(103,234)

(86,679)

(278,614)

(250,102)

Amortization of purchased intangibles

(3,630)

(3,641)

(10,813)

(10,804)

Litigation settlement

—

—

(5,000)

—

Operating expense on a non-GAAP basis

$  236,601

$  230,014

$  709,649

$  674,716

Operating income on a GAAP basis

$  181,353

$  128,489

$  503,012

$  294,070

Stock-based compensation expense

117,859

101,226

322,146

294,840

Amortization of purchased intangibles

4,812

4,906

14,490

14,558

Litigation settlement

—

—

5,000

—

Operating income on a non-GAAP basis

$  304,024

$  234,621

$  844,648

$  603,468

Operating margin on a GAAP basis

25.9 %

20.8 %

24.8 %

17.0 %

Stock-based compensation expense

16.9

16.4

15.9

17.0

Amortization of purchased intangibles

0.7

0.9

0.8

0.8

Litigation settlement

—

—

0.2

—

Operating margin on a non-GAAP basis

43.5 %

38.1 %

41.7 %

34.8 %

Net income on a GAAP basis

$  185,808

$  135,158

$  518,513

$  378,307

Stock-based compensation expense

117,859

101,226

322,146

294,840

Amortization of purchased intangibles

4,812

4,906

14,490

14,558

Litigation settlement

—

—

5,000

—

Income tax effect on non-GAAP adjustments(7)

(20,160)

(22,612)

(57,598)

(123,070)

Net income on a non-GAAP basis

$  288,319

$  218,678

$  802,551

$  564,635

Diluted net income per share on a GAAP basis

$        1.13

$        0.83

$        3.15

$        2.32

Stock-based compensation expense

0.71

0.62

1.95

1.81

Amortization of purchased intangibles

0.03

0.03

0.09

0.09

Litigation settlement

—

—

0.03

—

Income tax effect on non-GAAP adjustments(7)

(0.12)

(0.14)

(0.35)

(0.76)

Diluted net income per share on a non-GAAP basis

$        1.75

$        1.34

$        4.87

$        3.46

________________________

(7)

For the three and nine months ended October 31, 2024 and 2023, management used an estimated annual effective non-GAAP tax rate of 21.0%.

 

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SOURCE Veeva Systems

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U.S. Quartz Workers: Strong Safeguard Remedies Needed to Save 100,000 American Manufacturing Jobs

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July 23, 2026

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WASHINGTON, July 23, 2026 /PRNewswire/ — The Quartz Manufacturers Alliance for America (QMAA) released a powerful video featuring quartz manufacturing workers from across the country calling for free and fair trade policies to save 100,000 American jobs. QMAA, a coalition of leading U.S.-based quartz slab manufacturers, are calling for strong safeguard remedies after the U.S. International Trade Commission (ITC) found a huge flood of foreign imports had caused tremendous injury to the domestic quartz industry.

QMAA members are urging the Trump Administration to build on the ITC’s strong recommendation and address this major flood of quartz imports with a Tariff of 50% and a Reshoring Import Cap of 141 million square feet on imported quartz surface products. This will ensure a reshoring of the good-paying U.S. quartz manufacturing jobs stolen by companies who cheat U.S. trade law, distort competition and are decimating U.S. quartz manufacturing. Together, these trade remedies will provide the relief necessary to save the 100,000 jobs supported by the U.S. quartz industry.

The video features workers from LX Hausys, Guidoni USA and Cambria Company and is available here:
Save 100,000 American Quartz Jobs

Quotes from QMAA Quartz Manufacturing Workers
“This facility used to be a Husqvarna plant. Husqvarna closed down due to cheap foreign imports. There were over 1,000 people working here and all of a sudden…I’m worried I may see the same thing take place again.”
-Raymond Mack, Production Operator, Guidoni USA, Helena-McRae, GA

“Foreign countries, mainly China, Thailand, Malaysia, Vietnam, Indonesia, have been circumventing and cheating the American market. We believe in the industry. We believe in the American working power. We just want to level the playing field, make it fair for everyone and everyone will benefit.”
– Daniel Vas de Melo SA, Business Development Manager, Guidoni USA, McRae-Helena, GA

“In order for us to continue to compete, we need a strong Tariff and Import Cap on imported quartz surfaces. That will ensure we can play on an even playing field. That’s all we’re asking for. I would hate to see cheap, imported quartz have a negative impact on families such as mine and the other families that we employ here.”
– Mike Morici, Vice President – LX Hausys, Adairsville, GA

“The surge of foreign imports has shocked the U.S. economy, and the market for surfaces. It’s taken prices down to unsustainably low levels for any domestic supplier. The result of that is we’re not producing as much as we should, we can’t hire as many people as we would like to, and we can’t grow our business in the way that we and our peers in the U.S. want to grow.”
– Andrew Eich, President and Chief Operating Officer, Cambria

“As these foreign imports flood the market, we lose the ability to create and sustain jobs that ensure good paying conditions for manufacturing workers. There will be over 100,000 jobs that have the strong potential to go away.”
– Jack Sundry, SVP Core and Lexus – Cambria, Southern Minnesota

Background
In September 2025, QMAA filed a Global Safeguard petition with the U.S. International Trade Commission (ITC) under Section 201 of the U.S. Trade Act of 1974. The ITC’s thorough investigation found serious injury to the domestic industry caused by a massive import surge designed to undercut American businesses. Quartz imports have surged by 78.3% within the past five years, leading to a nearly 20% decline in domestic production, factory closures and major job reductions.

A final safeguard decision from the United States Trade Representative is expected by Aug. 1, 2026.

About the Quartz Manufacturing Alliance for America:
QMAA is a coalition of U.S.-based, American quartz slab manufacturing factories, united with other industry leaders to support and strengthen the American quartz industry. QMAA is committed to ensuring a free and fair, competitive marketplace born of free enterprise that provides the opportunity to compete on a level playing field for American quartz slab manufacturing factories and their valued workers. We also believe this effort will have a positive impact throughout the entire quartz surfacing industry, including to the strong benefit of American stone fabrication shops and upstream suppliers of quartz minerals and resin. Learn more at: https://www.qmaa.org/

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SOURCE Quartz Manufacturing Alliance of America

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Databricks and Microsoft expand partnership to help enterprises bring business context to enterprise AI

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July 23, 2026

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Databricks and Microsoft extend strategic partnership through the 2030s to scale enterprise AIDatabricks deepens its bet on Azure, growing its use of Azure Databricks to run its own core business operations and analytics, while both companies advance native integration across the Microsoft stack, including Databricks Genie and Microsoft 365Databricks increases its use of Microsoft Azure Cobalt to improve performance and efficiency

REDMOND, Wash. and SAN FRANCISCO, July 23, 2026 /PRNewswire/ — Microsoft Corp. and Databricks on Wednesday announced an expansion of their decade-long strategic partnership, extending into the 2030s. Databricks will deepen its use of Azure Databricks to run core business operations and build its unified lakehouse, while leveraging Azure Cobalt, Microsoft’s next-generation Arm-based infrastructure, to improve performance and efficiency. Microsoft will also continue integrating Databricks Data and AI platform across its products, bringing capabilities like Genie, Databricks’ AI co-worker, directly into customer workflows. Together, the companies are helping enterprises build AI grounded in their own business context with the cost efficiency, control and choice needed to scale successfully.

Enterprises want AI that understands their customers, products, operations, metrics and business processes, all while running securely where work happens. Yet, most still struggle to connect AI to trusted business knowledge, govern models and agents consistently, and control costs. Microsoft and Databricks are helping customers close that gap: 

“For nearly a decade, Databricks and Microsoft have helped enterprises innovate with data and AI,” said Ali Ghodsi, Co‑Founder and CEO of Databricks. “Today, our partnership is stronger than ever. With Databricks Genie and Unity AI Gateway deeply integrated across Microsoft’s products, we’re helping enterprises unify their data and ground AI in business knowledge. This lets customers get the full benefits of agents and models while controlling costs and ensuring governance.”

“The next generation of AI will be defined by how effectively organizations turn their unique knowledge into intelligence,” said Judson Althoff, CEO, Microsoft Commercial Business. “Microsoft and Databricks are helping customers connect data, AI and business context to accelerate decision-making and drive measurable impact. With Databricks deepening its investment in Azure Databricks and Azure Cobalt-powered infrastructure, customers will benefit from greater performance, efficiency and scale for their most demanding workloads. Databricks’ decision to run its own core business operations on Azure Databricks also gives customers confidence in a platform proven at enterprise scale.”

Databricks runs core business operations on Azure Databricks 

As part of this latest deal, Databricks deepens its commitment to Azure, running its own core business operations and analytics on Azure Databricks, using the very platform it delivers to customers at scale.

Advancing performance with Azure Cobalt

Databricks will also expand its use of Azure Cobalt, Microsoft’s next-generation Arm-based infrastructure, to improve performance and efficiency for agentic and data-intensive workloads. Databricks currently uses Cobalt 100 and plans to adopt Cobalt 200, which delivers up to 50% better performance and includes memory encryption enabled by default.

Deep integrations for Databricks Genie and Unity AI Gateway with Microsoft product stack

By combining the Databricks Data + AI Platform with Azure’s global scale, customers can accelerate AI transformation while maintaining control and reliability. As a native Azure service, Azure Databricks makes its AI capabilities available directly within customers’ existing Microsoft environment, grounding and operating agents on enterprise data with Genie and Genie Ontology, and governing models, agents and cost through Unity AI Gateway. Deeply integrated across the Microsoft ecosystem spanning Microsoft Entra, Azure Data Lake Storage, Azure security, Microsoft OneLake, Power BI, Microsoft Purview, Microsoft Foundry, Power Platform, Microsoft 365, Teams and Copilot, these capabilities bring governed, real-time data and AI into business workflows, giving organizations the context, control, choice and cost efficiency needed to drive impact.

Continued investment is evident from our recent announcements with Databricks at Data + AI Summit in June.

Customer impact with Azure Databricks

The deepened collaboration strengthens support for joint customers running data, analytics and AI workloads on Azure Databricks, delivering improved performance, security, AI governance and enterprise readiness. Thousands of customers, including Banco Bradesco, the Cincinnati Reds, Electrolux, SMBC and Unilever, already use Azure Databricks to run critical workloads and scale AI with confidence.

Read more on the proven business value of the Databricks and Microsoft partnership on the Microsoft Azure blog.

About Databricks

Databricks is the Data and AI company. More than 20,000 organizations worldwide — including AT&T, Bayer, BMW Group, HSBC, T-Mobile, Unilever, and 70% of the Fortune 500 — rely on Databricks Data + AI Platform to build and scale data and AI apps, analytics and agents. Headquartered in San Francisco with 30+ offices around the globe, Databricks offers a unified platform that includes Genie, Lakebase, Agent Bricks, Lakeflow, Lakehouse, and Unity Catalog. To learn more, follow Databricks on LinkedIn, X, YouTube, and Instagram.

About Microsoft

Microsoft (Nasdaq “MSFT” @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers. The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more.

 

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SOURCE Microsoft Corp.

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Harness and Kong Expand Strategic Partnership to Deliver Comprehensive API and AI Security

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July 23, 2026

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Joint solution extends proven API gateway security to the AI era — with automated AI discovery and runtime AI protection

SAN FRANCISCO, July 23, 2026 /PRNewswire/ — Harness, the AI Software Delivery Platform™ company, and Kong Inc., a leading developer of API and AI connectivity technologies, today announced an expansion of their strategic partnership to address the growing security challenges posed by AI-driven architectures, autonomous agents, and Model Context Protocol (MCP) deployments.

According to The State of AI-Native Application Security 2025 report, as enterprises race to deploy AI at scale, 62% have no visibility into where LLMs are in use across their environment, and 74% say AI sprawl will outpace API sprawl when it comes to risk — making embedded, infrastructure-level security more critical than ever. And companies are now deploying agents into their operations at an exponentially increasing rate, making it a necessity to protect the agents themselves and the systems interacting with those agents.

The two companies are extending their joint solution from Kong API Gateway to also include Kong AI Gateway, bringing Harness’s AI security intelligence directly into the AI infrastructure layer and enabling enterprises to discover, monitor, and protect every agent, AI asset, LLM-powered service, and MCP-connected workflow that traverses it.

A Proven Foundation: Harness and Kong API Gateway

Harness and Kong have been jointly trusted by enterprises to deliver best-in-class API security for years. The existing Harness and Kong API Gateway integration provides:

Comprehensive API traffic visibility and behavioral analysis across all Kong-managed servicesReal-time detection and blocking of API threats, including OWASP API Security Top 10 risks, credential stuffing attacks, and business logic abuseContinuous sensitive data tracking to identify PII exposure and regulatory riskZero-friction deployment alongside existing Kong configurations

This new offering of the AI Gateway solution applies the same level of security depth to AI infrastructure, ensuring that security teams are not left behind as their organizations adopt AI and agentic operations.

“Our partnership with Harness has given joint customers production-grade API security that works with the way they build, not against it,” said Ken Kim, Senior Vice President, Business Development at Kong Inc. “Extending to include Kong AI Gateway is a natural next step. The same enterprises are now moving AI into production through our gateway and need the same depth of visibility and control they’ve come to rely on for their APIs for all AI traffic types including LLM, MCP, and A2A. That’s exactly what this delivers and is crucial for organizations scaling in the agentic era.”

The New Frontier: Kong AI Gateway and Harness AI Security

As enterprises accelerate AI adoption, the attack surface has fundamentally shifted. AI agents, LLM-powered microservices, and MCP-enabled integrations introduce new vectors that traditional security tools were not designed to address. Unlike traditional software, AI agents are non-deterministic — the same agent can behave differently on consecutive runs, making it impossible to secure them the way you’d secure a static API. The new Harness and Kong AI Gateway integration directly tackles these challenges across two critical domains: AI discovery and AI protection.

AI Discovery
Harness automatically inventories every AI asset, API, MCP server, tool, prompt, and resource routed through Kong AI Gateway — providing security teams with a continuously updated catalog of their AI attack surface. No manual documentation. No blind spots.

AI Protection
Harness applies behavioral analysis and anomaly detection to AI traffic in real time, identifying prompt injection attacks, data exfiltration through AI responses, jailbreaking, malicious code in prompts, and other AI-specific threats. Enterprises gain the same depth of observability and protection for their agents and AI workloads that they already rely on for traditional APIs, with full prompt and response details available for incident investigation and inline policy enforcement through Kong AI Gateway.

“Shadow AI has become the defining security blind spot for enterprises today. Traditional tools were built for static code and predictable systems, not for adaptive AI models, agent-to-agent communication, and MCP-connected workflows that evolve continuously,” said Rahul Sood, GM of Application Security at Harness. “This integration of Harness AI Security with Kong puts security intelligence directly into the connectivity layer where AI traffic flows. Joint customers now have the visibility and control they need to move fast without losing sight of what’s happening across their AI infrastructure.”

Availability

The Harness and Kong API Gateway integration is generally available today for all joint customers. The Kong AI Gateway integration, including AI Discovery and AI Protection, is also generally available now. Joint customers can contact their account team or request a demo.

About Harness
Harness is the AI Software Delivery Platform™ company, enabling engineering teams to build, test, and deliver software faster and more securely. Powered by Harness AI and the Software Delivery Knowledge Graph, the platform brings intelligent automation to every stage of the software delivery lifecycle after code — removing toil and freeing developers from manual, repetitive work. Companies like United Airlines, Morningstar, and Choice Hotels use Harness to accelerate releases by up to 75%, cut cloud costs by 60%, and achieve 10x efficiency across DevOps. Based in San Francisco, Harness is backed by Goldman Sachs, Menlo Ventures, IVP, Unusual Ventures, and Citi Ventures.

About Kong

Kong Inc., a leading developer of API and AI connectivity technologies, is building the connectivity layer of AI. Trusted by the Fortune 500® and AI-native startups alike, Kong’s unified API and AI platform enables organizations to secure, manage, accelerate, govern, and monetize the flow of intelligence across APIs and AI traffic — on any model, any cloud. For more information, visit www.konghq.com.

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SOURCE Harness

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