VEEVA SYSTEMS INC

Results of Operations

The following tables set forth selected condensed consolidated statements of operations data and such data as a percentage of total revenues for each of the periods indicated:

Revenues

Total revenues for the three months ended April 30, 2024 increased $124 million, of which $119 million was from growth in subscription services revenues. The increase in subscription services revenues consisted of $97 million of subscription services revenue attributable to R&D Solutions and $22 million of subscription services revenue attributable to Commercial Solutions. The addition of termination for convenience rights starting on February 1, 2023, reduced subscription services revenue attributable to R&D Solutions for the three months ended April 30, 2023. The geographic mix of subscription services revenues was 59% from North America, 28% from Europe, and 13% from other locations, primarily Asia Pacific, for the three months ended April 30, 2024, as compared to 59% from North America, 26% from Europe, and 15% from other locations, primarily Asia Pacific, for the three months ended April 30, 2023.

Professional services and other revenues for the three months ended April 30, 2024 increased $5 million. The increase was primarily driven by increased demand for our business consulting services. The geographic mix of professional services and other revenues was 59% from North America, 35% from Europe, and 6% from other locations, primarily Asia Pacific, for the three months ended April 30, 2024, as compared to 62% from North America, 31% from Europe, and 7% from other locations, primarily Asia Pacific, for the three months ended April 30, 2023.

Cost of Revenue and Gross Margin

Cost of revenues for the three months ended April 30, 2024 increased $7 million, of which $11 million was related to an increase in cost of subscription services, offset by an immaterial decrease in professional services and other due to a reduction in the use of third-party services to support our professional services revenue. The increase in cost of subscription services was primarily due to an increase of $6 million related to computing infrastructure costs, which was driven by an increase in both the number of end users and the volume of activity by end users of our subscription services.

We expect cost of subscription services to increase in absolute dollars in the near term due to increased usage of our subscription services and increased data costs related to our data solutions.