Good afternoon. My name is Chantal and I will be your conference operator today. At this time, I would like to welcome everyone to the Veeva Systems' Fiscal 2018 Fourth Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. Rick Lund, Director, Investor Relations and Corporate Development, you may begin your conference.

Good afternoon and welcome to Veeva's fiscal 2018 fourth quarter and full year earnings call for the quarter and year ended January 31, 2018. With me on today's call are Peter Gassner, our Chief Executive Officer; Matt Wallach, our President; and Tim Cabral, our Chief Financial Officer. During the course of this conference call, we will make forward-looking statements regarding trends, our strategies, and the anticipated performance of the business. These forward-looking statements will be based on management's current views and expectations and are subject to various risks and uncertainties. Actual results may differ materially. Please refer to the risks listed in our earnings release and the risk factors included in our most recent filing on Form 10-Q, which is available on the company's website at veeva.com under the Investors section and on the SEC's website at sec.gov. Forward-looking statements made during the call are being made as of today, February 27, 2018. If this call is replayed or viewed after today, the information presented during the call may not contain current or accurate information. Veeva disclaims any obligation to update or revise any forward-looking statements. We will provide guidance on today's call but will not provide any further guidance or updates on our performance during the quarter unless we do so in a public forum. On the call, we will also discuss certain non-GAAP metrics that we believe aid in the understanding of our financial results. A reconciliation to comparable GAAP metrics can be found in today's earnings release, which is available on our website and as an exhibit to the Form 8-K filed with the SEC just before this call. Also, we've made a presentation related to the new accounting standard commonly known as ASC 606 available on the Investor section of our website. As a reminder, beginning in fiscal 2019, we are adopting ASC 606 using the full retrospective method, which means that we'll be restating certain of our fiscal 2017 and fiscal 2018 financial information according to the new standard. Please note that these numbers are still under review and are subject to change until they are finalized in our 10-K, which we expect to file toward the end of March. With that, thank you for joining us and I'll turn it over to Peter.

Thank you, Rick, and thanks to everyone for joining us today. I'm pleased to report a strong finish to another great year for Veeva. We once again delivered financial results that were above our guidance. Total revenue in the fourth quarter was $185 million, up 23% year-over-year. Subscription revenue grew at 26%, and our non-GAAP operating margin was 28%. This is a great quarter, one of our best quarters. We made great progress in each of our markets. We innovated in multiple areas. We continued our focus on customer success, and we're planting seeds for future growth. Turning to the different areas of the business; in commercial we continue to extend our leadership position as companies look to Veeva as a cloud technology foundation for their commercial operations. In Q4, two top 10 pharmas committed to expanding their use of Veeva CRM to emerging markets, including Latin America and Asia Pacific. These rollouts will happen over the next 12 to 18 months. Both are long-standing Veeva CRM customers who started with us in the U.S. many years ago. It's great to see these early partnerships expanding towards global deployments. This progression is consistent with the trend we're seeing toward greater global harmonization and standardization on Veeva. This creates a more efficient environment for IT organizations, enables consistent engagement channels around the world and sets our customers up with a solid commercial technology foundation as they look to leverage more digital engagement in the future. With global CRM as a base, we are seeing steady regional adoption of the broader Commercial Cloud, including Veeva Events (sic) [Veeva CRM Events] Management and Veeva Align with a number of wins in the quarter. Overall, we are very pleased with the performance of Veeva Commercial Cloud. Turning to Vault, we had another excellent quarter…

Thanks, Peter. Q4 represented a great finish to another strong year of execution. Our top and bottom line results came in ahead of our guidance, and we have raised our expectations for fiscal 2019. Subscription revenue in the quarter was up 26% to $151 million from $119 million last year. Subscription revenue was improved by a stronger than expected bookings performance in Q4 wrapping up a full year in which subscription revenue came in at $554 million, up from $434 million in fiscal 2017, a 28% increase. For the full year, Commercial Cloud subscription revenue grew almost 16% and Vault grew nearly 57%, both slightly better than our previous expectations. In fiscal 2018, our revenue retention rate was 121%. This metric is defined in the earning release and reflects annualized subscription revenue growth within existing customers, net of revenue attrition. This demonstrates our focus on delivering increasing value to our customers over time. Services revenue for the quarter was $34 million, up 11% from $31 million one year ago and flat from Q3. This result exceeded our expectations by about $2 million due to the strong demand within Vault's R&D and a couple of fixed-fee milestones that we recognized. Total revenue for the fourth quarter was $185 million, up 23% from $150 million one year ago. Momentum in Vault continued with Vault representing 42% of total revenue in Q4, up from 35% a year ago. This capped the year in which total revenue was $686 million, up from $544 million in fiscal 2017, an increase of 26%. In discussing the remainder of the income statement, please note that unless otherwise stated all references to our expenses and operating results are on a non-GAAP basis and are reconciled to our GAAP results in the earnings press release that was posted just…

Your first question comes from Richard Davis with Canaccord. Your line is open.

Hey, thanks. You kind of touched on it, but you're looking at the EDC market at an interesting time, right. You've got CROs merging and data sources changing and collection, et cetera, et cetera, and all that, but I'm a cold-hearted finance guy, so help me think about kind of how the revenue path should occur in this space. I mean, I know it's early, but will it come in kind of like a small beachhead where you would be in a specific project and then you would expand from there, or is there a possibility that you could get like a big transformation – not transformation, but a large deal that would pop in potentially in 2018 or whatever? Thanks.

Richard, this is Peter. I think the EDC revenue will be incremental. We'll start to see some momentum build in the next year. I don't think in the first year or two it will be amenable to a large transactional chunk, and the reason why that, customers will be particularly sensitive about getting a new provider in this area because it's dealing with patient data, so we have to prove ourselves out either in smaller companies or in studies – very specific clinical studies of larger companies. Now, I think over the years, if you look a couple of years out, yeah, I think you could have it come in big chunks like the rest of Vault, but it won't start out that way. And by its nature, it's a study-based thing, so, I think it's going to be more sort of steady increments and not quite so much in big chunks.

Yeah, that makes sense. That's very helpful. Thanks so much.

Thanks, Richard.

Your next question comes from the line of Sterling Auty with JPMorgan. Your line is open.

Yeah, thanks. Hi, guys. I actually want to ask a similar question, but around Vault. So, given where we are in the evolution of the Vault business relative to where Commercial Cloud is, you've given us the guidance for 40% plus growth in terms of the Vault revenue, but how should we think about the evolution of how much of the Vault revenue is going to come from further expansion of existing customers versus continuing to add, as you mentioned, double-digit new customers in each one of the categories here in fiscal 2019?

Sure, Sterling, it's Matt. So, I think similar to Commercial, there's 50 companies that are significantly bigger than the others, and the majority of those companies have some Vault already. And so, because those are so much bigger than the others, the majority of our Vault revenue will come from kind of cross-selling within those top 50 companies. But the one big difference between the Commercial business and Vault is that Vault has a much longer tail. All right. So, the Commercial business we can sell to the 400, 500 companies that have a product on the market. For Vault, there's an extra 2,000 pharma and biotechs and like 10,000 smaller med device companies that we can sell to. And so, the tail of what we consider are SMB or a small and medium-sized business is much, much larger with Vault. And so, that's why you see the customer count increasing so much more quickly with Vault than it did with CRM. And the way that we manage the business is that that is an even more important part of the overall Vault business.

All right, great. And then one follow-up on QMS. It seems like you've got really good traction in terms of the early referenceable customers, et cetera. How is this one monetized? So, do we need to wait for the second or third purchase to get meaningful revenue or just how is the monetization model in QMS going to work?

So, QMS looks a lot like other Vault applications, where it can be an employee-based thing, so it's a per user per month with small and medium-sized companies. And then with the largest companies we may do an ELA. And when we do a big ELA for a big global QMS deal, it would look something like what we'd talked about in the past. It could be $1 million, $3 million, $5 million in the first, second, third year, something like that. And I'm using just representative numbers. But so, we call those our escalating ELAs. And as you drill down with 606 with Tim maybe later in the call, these are the things that caused the change in how revenue is recognized based upon how those contracts are written. So, QMS you should think of as just like another one of our big enterprise Vault applications – nothing different there.

All right. Thank you, guys.

Your next question comes from the line of Bhavan Suri with William Blair. Your line is open. Bhavan Singh Suri - William Blair & Co. LLC: Hey, gentlemen. Thanks for taking my question and congrats there on another good quarter. I guess just first question, as you think about the investments you made in 2017, you sort of made more investments, I think, than you have sort of in the past as you think about new initiatives, right? You had the CRO sales folks. You had OLS salespeople. You sort of increased sort of the EDC sort of space and obviously, that's into some of the Vault, but different buyer than the eTMF. And so, as you think about those sales investments, I'd like to just understand how you've seen the productivity ramp and has it been in line with what your expectations are, a little better? How have those investments actually played out?

Bhavan, this is Peter. They played out well. They're different, right? OLS, I would say there we're more looking for early adopters. We're not going to get quite the sales productivity there that we would have in our established areas. In the CRO area, that's worked out very well because we have established products that we can sell in there, so productivity is high there. And also, we built out – last year we significantly increased our capabilities in the med device area, in the field team for med device. And that's also gone very well. So, I'm happy with the buildout in all areas. I really measure the productivity in the field by the depth of the customer relationships we're getting, the initial projects we're starting. That's the leading indicator of productivity, so they're all going very well for us. I can't point it out to one that's going particularly better than the others. Now, the ACB will come when it comes and that just has to do with the phase of the market. Bhavan Singh Suri - William Blair & Co. LLC: Got it, got it. And then just on OLS. Obviously, if you'd ask me, I'd have said maybe you've got a dozen or maybe 15, 16 customers. The 20 was definitely a positive. When you think about the customers that started adopting this that sort of might be in the implementation phases, and you think about the penetration of the OLS product in those markets, just two questions. One, who are you displacing? And then two, what does that penetration or potential for upsell or ASP lift or share of wallet look like, say, over the next three to five in one of those existing customers, say, even that sort of large CPG customer you signed a few quarters ago?

Well, generally, I would – we're displacing different types of vendors. Maybe the most common vendor we'll be replacing is actually a custom-built system on a Documentum or on a SharePoint. It could be on something else like OpenText. That's the most common thing that we're replacing. We may be replacing a legacy QMS provider. Now, in terms of cross-sell or growth, these large customers like that CPG customer, I do believe that can be an eight-figure annual subscription deal over time. But that will probably play out over the next – if it plays out, that will play out over the next – to get to that level is really three, four, five years; probably four or five years because that's when you're doing multiple projects with this customer across multiple regions. You're doing QualityOne. You're doing some adjacent things. There's certainly potential to be – for those to be six-figure customers. Bhavan Singh Suri - William Blair & Co. LLC: Very helpful, guys. Thank you and congrats again. Appreciate it.

Okay.

Your next question comes from the line of Rishi Jaluria with D.A. Davidson. Your line is open.

Hey, guys. Thanks for taking my questions, and it's nice to see some continued strong results. I guess, first, Peter, as we look at Vault EDC, I mean, it's nice to see the early adopters and go-lives. Can we see kind of a similar sales motion with EDC with reference selling and kind of expansions just given the nature of clinical trials and how that may be different from other areas of life sciences? And then I have a follow-up for Tim.

Yeah. We definitely think we'll see reference selling for sure because inside of life sciences, this EDC area, you're selling into an area of life sciences called data management and it's a specialized area, and word of success really gets around. So, this year, for example, we're working on our early adopters. We'll get them live, get them happy and prove our products. We have our R&D Summit coming in the fall in Philadelphia. We hope to get our early adopters there, get some prospects there to see that and fuel that enthusiasm. So that will be very similar to the other parts of life sciences. It will be a reference-selling game, for sure.

Got it. That's helpful. Thanks. And, Tim, just kind more of a housekeeping question, but can you help us understand what sort of benefit you'll see next year from the lower tax rate on cash flow? Because if my recollection is correct, FY 2018 wasn't a full cash taxpaying year. So, just maybe if you could walk us through that, that would be helpful. Thanks.

Sure. Yeah, with the new tax reform, we will actually see both a tailwind and a headwind on operating cash flow. The tailwind, as you mentioned, Rishi, will simply come from a lower tax rate being applied to our GAAP income before tax. But what may not be as obvious is that we will also see a headwind that will come from the smaller excess tax benefit from equity compensation as the tax rate declines. So, there's a tailwind and a headwind that is impacting us from the tax reform and the operating cash flow line.

Got it. Thanks, guys.

Your next question comes from the line of Stan Zlotsky with Morgan Stanley. Your line is open. Stan Zlotsky - Morgan Stanley & Co. LLC: Perfect. Thank you so much, guys. A couple of very quick ones for me. On the first one, the 20 customers outside of life sciences, which products are these customers getting into? Is it the QualityOne, or is there something else that they're buying in that segment? And second question – this probably would be for Matt – the sales constructor changes that you're making for fiscal 2019, can you just maybe dig into that a little bit more? And that's it for me. Thank you.

Okay. In terms of QualityOne, we're selling into those 20 customers outside of life sciences, yes, we're selling QualityOne in there; and in some cases, we're selling platform deals. Now, when we first start talking to customers outside of life sciences, we'll be talking to them about QualityOne and that's a very important, very strategic area. They like our vision, but they may not be able to start there right away. That might spark interest in, hey, well, this Vault platform looks great, can we use it? We're going to have to replace this other custom system that we have. Can we use it for that? So, we'll entertain some platform projects. In fact, the new top 30 chemical company that I talked about, that's actually a small platform project. We were in there talking about QualityOne that sparked interest in this platform project. So that can happen – as you may recall, we started with our large consumer packaged goods company. We started in the platform area that then moved into QualityOne. So, it's always those two products. In terms of the sales compensation, I guess, I can take that one, too. Sales compensation, that's a very important thing over the long term. We look at it closely every year. And when we looked at the way we do reference selling today, the products we have, the strategic nature of our customer relationships, it became clear that the old sales comp model, we need to make some changes there. And one of the changes was to increase the fixed compensation and lower the variable compensation for the salesperson. We expect the total sales compensation to be about the same on the average for each individual person, of course, the high performers making more than the low performers. But we're changing the mix, the fixed to variable. And those changes are rolled out already. They're going well. We communicated to – in Q4. So existing people like it. We're bringing on new people under that model, and it's going really well. So, it's really about setting up for the future. It's about being proactive with our sales comp model. Stan Zlotsky - Morgan Stanley & Co. LLC: All right, perfect. Thank you, guys.

Thanks.

Your next question comes from the line of Tom Roderick with Stifel. Your line is open. Thomas Michael Roderick - Stifel, Nicolaus & Co., Inc.: Gentlemen, good afternoon. Thanks for taking my questions. Curious a little bit to hear a bit more on the EDC and CTMS decision cycles if you look at some of your top 20 customers. I recognize that those decision cycles sort of come up as new trials come about, and on the clinical side that doesn't happen every day. But maybe you can talk a little bit about the pace of new opportunities that you see out there. Are you given the chance at some of those top 20s to displace the existing competition, or they kind of continue to roll over what they're using? And then when you look at the aggregate of those opportunities and from a dollar basis, does that start to add up to what you're already doing in Vault; in other words, capable of seeing eight-figure deployments between EDC and CTMS at those top 20s? Thanks.

Sure. Yeah. So, you're lumping CTMS and EDC. So, let me just start by splitting that. So CTMS looks like a more normal – I shouldn't say normal. It looks like many of the other Vault applications, where we're starting with smaller companies and when you get a CTMS deal, they general use it for everything. And of the 19 companies, some of them are replacements of a competitive product and some of them are smaller companies that are actually deploying a CTMS for the first time. As we talk to companies in top 20, the largest companies, CTMS is one of the most heavily integrated products. And so, the sales cycles will be relatively long and those are big, major enterprise deals, where they're going to rip out a system that could have literally dozens of integrations to other stems. And it's a major project. It's not a two- or three-month project. It's more like a 9- to 12-month project. So those will start in the next year or two as the early adopters get on stage and tell the larger companies how successful they've been with the product. And then once we're moving with those large companies, it will look a lot of the other Vault applications. EDC is different because of the nature of it being a trial-by-trial thing. And so, we're already talking to top 20 companies, but we're talking to them today about their phase 1 and 2 trials. So, these are smaller trials and they would look identical within a large CRO or a small CRO or a large pharma company or a small one, kind of phase 1, phase 2 trial is a phase 1, phase 2 trial. And as Peter talked about it, we're going to ramp that business the end of…

Yeah, sure. So, it's looking pretty balanced now. So, there's always new seat add-ons from small companies, from companies in new geographies. We closed our first deal in Korea with a Korean domestic pharma company, a company that many of us hadn't heard of two, three years ago. And then we talked about these two top 20s that are expanding in emerging markets. So yes, there's still new seat adds. That's probably about half of the incremental revenue, and then the other is doing well with the add-on products, which as we've said, are generally being sold more regionally, and so there's more sales cycles there. But we do get to use the reference selling, sometimes even within the same company, right, so if someone tries one of those add-on products in Asia, it can lead to deals in Europe and the U.S. So, it's pretty balanced this year between new seats and add-on products. Thomas Michael Roderick - Stifel, Nicolaus & Co., Inc.: Perfect. That's really helpful. Thank you, guys. Nice job.

Your next question comes from the line of Brad Sills with Bank of America Merrill Lynch. Your line is open.

Oh, hey, guys. Thanks. I wanted to ask a question on Safety. I know it's probably early here, the product is not out yet, but what's your expectation here for Safety? Is there a legacy installed base here that you view as right for displacement? Could we perhaps see Safety going in higher than the other products involved, further up market and then kind of move from there than we've seen in the past?

Sure, Brad. So, the safety market, I think, is perfect for Veeva to disrupt. There's two main companies that basically dominate the top 50 and many smaller companies. One was bought by Oracle years ago, one is a smaller company, but the two of them have been the clear market leaders for at least 15 years. It's probably over 20 years. So, they really split the market. Both are traditional on-premise legacy software solutions. So, when we look at that market, we think – it looks a whole lot like going after Documentum or going after Siebel in CRM. And the level of importance of these systems is one of the other things that gets us excited about it, because this – for many companies, this is one of the most important systems. I had one customer tell me if the adverse event system, the Safety system goes down, the CEO gets an email right away. And while our other systems, many of them are important, the CEO is not informed the moment one of those things has an outage. So, it is a really important thing. They spent a lot of money on it. We think this is going to be maybe even larger than something like our whole regulatory business. So bigger than the whole Vault RIM suite. And that's because of the level of importance and the depth of the product. It is a big product. So, you'll see this year we're going to be building it. We'll have an early adopter in a year or next year. We'll probably be going after smaller companies, so it will be a couple years before we're announcing big deals with top 20 pharmas.

Great. Thanks. And one also on commercial, if I may. With Events, Align, I think last quarter you had cited that you expect a longer tail of adoption here, more departmental expansions than companies kind of going all in with one of those two products. Is that still the expectation going forward? And maybe just a reminder on kind of how penetrated you are and what kind of cycle we're looking out for those two? Thank you.

Sure. Yeah. So, it still feels more regional, although we did sign one large Events deal that was a global deal. But we think that that's not going to be the norm here. So, it can still happen for sure, and that was a company that really wanted to streamline their global processes around Events Management. But generally, what we've seen both for Events and Align is that they're thinking about those things regionally. They run their businesses more regionally. So, it does align to how some of them have deployed CRM in some of their business processes before. In terms of penetration, they've both had a good year. Events, I think, had a particularly great Q4. A lot of new projects, a lot of excitement, and it's now eclipsed 10% of our customers are using Events in at least one place. Align is still chasing that 10% penetration rate.

Great. Thanks, Matt.

Your next question comes from the line of Scott Berg with Needham. Your line is open. Peter Levine - Needham & Co. LLC: Great. Thanks, guys. This is actually Peter Levine in for Scott. So just one question for me. To piggyback off some of the EDC questions, can you provide any additional color on your go-to-market strategy? I kind of ask that question if there's a specific group of pharmas or trials that you're targeting, whether it be kind of more complex trials like oncology or genotherapy, or is it more targeting trials with much larger patient studies, say for blood pressure or diabetes type medication trials? Thanks.

Yeah. Our end market for EDC is all types of trials, from the phase 1 all the way to the phase 4 for small molecule, large molecule, big trials, small trials. Now, where we're going to get traction first is in less complex trials. That will be phase 1 and phase 2 in general. Although one of our early adopters is in a pretty complex phase 2 oncology trial. So, it can happen where we'll get into a complex trial, but in general we're going to be in the simpler trials. We expect to – by the end of the year we'd like to have all the features and functions and things that we need in our service to handle trials of all sizes. Then we're just going to have to prove that out with some early adopters and get into that reference selling mode. Peter Levine - Needham & Co. LLC: Great. Thank you.

Your next question comes from the line of Brian Peterson with Raymond James. Your line is open. Brian Peterson - Raymond James & Associates, Inc.: Hi, guys. Thanks for taking the question and congrats on the quarter. So, I just wanted to hit on the outside of life sciences effort. You mentioned that you could see an eight-figure subscription relationship potentially over four to five years. I'm curious. Do you have an eight-figure relationship in quality today in life sciences? And as you think about the platform demand outside of life sciences thus far, has that interest been a lot stronger than you expected when you started this initiative?

I'll take the second one first. I think the platform interest outside of life sciences has been about what we've expected actually. We knew that when we showed QualityOne, not everybody's going to be amenable to replacing their quality system right away, and they're generally a little risk-averse in that area, but we knew we'd be enthused about the system. We knew we would be sometimes talking with people from the IT side. This would bring up thoughts about other systems. So, I think that was planned. Now, in terms of the eight-figure customers inside of life sciences that are specific only to a quality, that's a level of detail that we don't break out. I think we've mentioned before we certainly have quite a few seven-figure deals in the quality area, but we're not going to break out into whether we have individual eight-figure customers in the quality area. Brian Peterson - Raymond James & Associates, Inc.: Got it. And maybe one follow-up...

Now, what I would say... Brian Peterson - Raymond James & Associates, Inc.: Oh, sorry, go ahead, Matt.

Some of these customers in the quality area for the OLS, some of these are very large customers, right, that are doing manufacturing all around the world, more manufacturing heavy than our life sciences customers. And when I say an eight-figure customer there, it may not only be QualityOne. It may be some of the platform things that are associated with QualityOne. So, I think that's how you should read it. We'd be a very important supplier to some of these customers outside of life sciences doing QualityOne and some other things, and then a big customer that can add up to an eight-figure a year customer. Brian Peterson - Raymond James & Associates, Inc.: Got it. Thanks. And maybe one follow-up for Tim. Just on the retention metric, as you guys clearly scale the customer base, 122% this year, any help on how we should be thinking about that metric relative to revenue growth going forward? Thanks, guys.

Yeah, sure, Brian. It was 121%. I may have – I stuttered on that, maybe you heard 122%. So it was 121% and typically – and I would say over the last three years, three to four years, what we've seen is a pretty close relationship between overall stubs revenue growth and that revenue retention rate. Typically, we're seeing anywhere between sort of two-thirds of or 70% of, sometimes it could be a little higher, but right in that range, Brian, of the subscription revenue growth that's attributable to the existing customer base. That's probably the relationship that you would want to look at as we move forward. Brian Peterson - Raymond James & Associates, Inc.: Got it. Thanks, Tim.

Yeah.

Your next question comes from Jesse Hulsing with Goldman Sachs. Your line is open. Jesse Hulsing - Goldman Sachs & Co. LLC: Yeah. Thank you, guys, for taking my question. I had a question about QualityOne. I'm curious what you're seeing on the referenceability side, in life sciences your referenceability is incredibly strong. It sounds like you closed another top 30 chemicals company. Was the original chemicals company involved in referencing on that? And if you are seeing that sort of referenceability, should we expect clustering in some of these industries like chemicals as a couple of big buyers took over, more to follow?

Yeah. In terms of the new top 30 chemical company, there may have been some references behind the scenes that, of course, it's hard to know exactly what sways things in your favor. But nothing direct that we know about because we're very early in that cycle. However, this – I believe it's in May, we're going to get our QualityOne customers together in Cincinnati for the first time for a QualityOne Summit (sic) [Quality Summit] in Cincinnati and that's the first time we'll get customers together and really start that reference selling cycle in earnest. So, right now, no, we're not in reference selling mode yet. To the second part of your question, yeah, I do expect things to go in clusters. I think the reference selling works and a chemical company listens to a chemical company and a consumer packaged goods company listens to another consumer packaged goods company, I think just natural. And that's also the way employees flow, too. Employees often move in similar types of companies. Jesse Hulsing - Goldman Sachs & Co. LLC: Yeah, makes sense. And one quick one for Tim. Once you're done with this migration to AWS, what should we expect for gross margins? Should we expect those to trend higher and any sense of how much higher they can go? Thanks.

Sure, Jesse. Yeah. As it relates to subscription gross margin, as you heard in my prepared remarks, we are right now paying AWS costs, and we're still paying our legacy provider as we go through this period of transition. Once that rolls off and we target it fully to roll off by the end of Q2, I think you'll start to see subs revenue or, excuse me, subs margin continue to climb up as you saw in the past. So, it will continue to inch up as we get more leverage in that particular area. Jesse Hulsing - Goldman Sachs & Co. LLC: Thanks, guys.

Your next question comes from the line of Kirk Materne with Evercore ISI. Your line is open.

Hey, guys. This is Daniel Greenfield on for Kirk. As you all continue to evolve into a more strategic platform for your large customers, do you feel you have all the necessary bandwidth in terms of services resources internally? And then how are you thinking about your own services business versus building out your partner ecosystem as you continue to broaden your portfolio? Thanks.

Hi, Daniel. Thanks for the question. So basically, we split projects with partners, and this is – over time this has become more and more the way that we do it, where we do certain parts of an implementation and they do other parts. And so, when we think of scaling our services business, we think of scaling to do our piece of those implementations. And so, there's always a partner ecosystem that is helping us to scale. So, I don't think that the relative importance of partners has really changed over time. We did the same type of thing with CRM in the early years, and even today, and we set up that same type of relationship with multiple implementation partners in each area as we go into a new area of Vault. Then the other thing that is happening within the customer base and kind of flowing through the partners is looking not one application at a time, but looking at Vault as a real enterprise platform. And so right now we are leading that, and we have most of those discussions with our customers, and the customers very often want to have those discussions with us. I hear from CIOs, even CEOs often, they want to have a Vault first or a Veeva first strategy, where they'll actually say, why couldn't we do it with Veeva? I think our partners are now starting to give that same kind of messaging when we're not in a room, and I think that that's going to be a theme as we continue to become more and more strategic and companies buy more and more Vaults all on this unified platform, really making us a strategic partner to the industry.

Great. Thanks.

There are no further questions at this time. I will now turn the call back over to Peter Gassner.

Thanks for your time today. We're pleased with our outstanding results for the quarter and for the year, and we'd like to thank our employees for their outstanding work, as well as our customers and partners for their trust and partnership. Thank you.

This concludes today's conference call. You may now disconnect.