Reflecting On Vertical Software Stocks’ Q3 Earnings: Veeva Systems (NYSE:VEEV)
Looking back on vertical software stocks' Q3 earnings, we examine this quarter's best and worst performers, including Veeva Systems (NYSE:VEEV) and its peers.
Software is eating the world, and while a large number of solutions such as project management or video conferencing software can be useful to a wide array of industries, some have very specific needs. As a result, vertical software, which addresses industry-specific workflows, is growing and fueled by the pressures to improve productivity, whether it be for a life sciences, education, or banking company.
The 17 vertical software stocks we track reported a weaker Q3; on average, revenues beat analyst consensus estimates by 1.1% while next quarter's revenue guidance was 1.5% below consensus. Investors abandoned cash-burning companies to buy stocks with higher margins of safety, but vertical software stocks held their ground better than others, with the share prices up 11.9% on average since the previous earnings results.
Veeva Systems (NYSE:VEEV)
Built on top of Salesforce as one of the first vertical-focused cloud platforms, Veeva (NYSE:VEEV) provides data and customer relationship management (CRM) software for organizations in the life sciences industry.
Veeva Systems reported revenues of $616.5 million, up 11.6% year on year, in line with analyst expectations. It was a slower quarter for the company, with underwhelming revenue guidance for the next quarter and full-year.
"It was another strong quarter as we advance the industry toward more efficient and effective ways of working, from drug development through commercialization," said CEO Peter Gassner.
The stock is up 16.6% since the results and currently trades at $208.21.
Is now the time to buy Veeva Systems? Access our full analysis of the earnings results here, it's free.
Best Q3: Doximity (NYSE:DOCS)
Founded in 2010 and named for a combination of “docs” and “proximity”, Doximity (NYSE: DOCS) is the leading social network for U.S. medical professionals.
Doximity reported revenues of $113.6 million, up 11.2% year on year, outperforming analyst expectations by 4.1%. It was a very strong quarter for the company, with optimistic revenue guidance for the next quarter and a decent beat of analysts' revenue estimates.
The stock is up 37.3% since the results and currently trades at $28.14.
Is now the time to buy Doximity? Access our full analysis of the earnings results here, it's free.
Weakest Q3: Upstart (NASDAQ:UPST)
Founded by the former head of Google's enterprise business Dave Girouard, Upstart (NASDAQ:UPST) is an AI-powered lending platform that helps banks better evaluate the risk of lending money to a person and provide loans to more customers.
Upstart reported revenues of $134.6 million, down 16.1% year on year, falling short of analyst expectations by 3.7%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' revenue estimates.
Upstart had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is up 21.2% since the results and currently trades at $35.64.
Read our full analysis of Upstart's results here.
Unity (NYSE:U)
Started as a game studio by three friends in a Copenhagen apartment, Unity (NYSE:U) is a software as a service platform that makes it easier to develop and monetize new games and other visual digital experiences.
Unity reported revenues of $544.2 million, up 68.5% year on year, falling short of analyst expectations by 0.9%. It was a weak quarter for the company, with a miss of analysts' revenue estimates. The major negative, however, was that the company stopped providing financial guidance.
Unity achieved the fastest revenue growth among its peers. The stock is up 37.2% since the results and currently trades at $34.62.
Read our full, actionable report on Unity here, it's free.
Autodesk (NASDAQ:ADSK)
Founded in 1982 by John Walker and growing into one of the industry's behemoths, Autodesk (NASDAQ:ADSK) makes computer-aided design (CAD) software for engineering, construction, and architecture companies.
Autodesk reported revenues of $1.41 billion, up 10.5% year on year, surpassing analyst expectations by 1.9%. It was a mixed quarter for the company, with a decent beat of analysts' revenue estimates but underwhelming revenue guidance for the next quarter.
The stock is up 10.8% since the results and currently trades at $240.99.
Read our full, actionable report on Autodesk here, it's free.
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The author has no position in any of the stocks mentioned
