Core Insights - Vertex reported revenue of $177.06 million for the quarter ended March 2025, reflecting a year-over-year increase of 12.9% [1] - The earnings per share (EPS) was $0.15, unchanged from the same quarter last year, with a surprise of +15.38% compared to the consensus estimate of $0.13 [1] - The revenue exceeded the Zacks Consensus Estimate of $176.57 million by +0.28% [1] Financial Metrics - Annual Recurring Revenue (ARR) reached $618.50 million, slightly above the average estimate of $617.91 million from two analysts [4] - Service revenues were reported at $26.30 million, surpassing the estimated $25.12 million by four analysts, marking a +5.4% increase year-over-year [4] - Software subscription revenues totaled $150.76 million, slightly below the estimated $151.50 million, but still showing a +14.4% increase compared to the previous year [4] Stock Performance - Vertex shares have returned +10.3% over the past month, compared to a +10.6% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Vertex (VERX) Q1 2025 Earnings Call May 07, 2025 08:30 AM ET Company Participants Joe Crivelli - Vice President, Investor RelationsDavid DeStefano - President, CEO and Chairperson of the BoardJohn Schwab - Chief Financial OfficerAdam Hotchkiss - VP - Emerging Software Equity ResearchAlexander Sklar - Vice PresidentKyle Aberasturi - Equity Research Senior AssociateWilliam Jellison - Associate VP Conference Call Participants Joshua Reilly - Senior AnalystChristopher Quintero - AnalystGeorge Kurosawa - Equity ...

Financial Data and Key Metrics Changes - In the first quarter, revenue was $177.1 million, up 12.9% year over year, with subscription revenue growing 14.4% and cloud revenue increasing 29.6% [5][21] - Adjusted EBITDA was $37.2 million, representing an EBITDA margin of 21.3%, which was above the high end of the guidance range for the quarter [5][26] - Annual recurring revenue (ARR) grew 17.9% to $618.5 million, with net recurring revenue (NRR) remaining strong at 109% [5][22] Business Line Data and Key Metrics Changes - Subscription revenue increased to $150.8 million, while services revenue grew 5.4% to $26.3 million [22] - Cloud revenue was $80.2 million, up 29.6% from the previous year, with Ecosio contributing approximately 3.5 points to cloud revenue growth [22] - Average annual revenue per customer for Vertex standalone increased 16% year over year to $141,000, with a 15% growth in scaled customer count [6][22] Market Data and Key Metrics Changes - Gross recurring revenue (GRR) was 95%, within the targeted best-in-class range of 94% to 96% [6] - The company noted that the proliferation of e-invoicing mandates globally is expected to be a significant tailwind for the business in the coming years [6][19] Company Strategy and Development Direction - The company announced an equity investment in Kintsugi, a startup focused on applying AI technology to indirect tax in the small business sector, indicating a strategic move towards AI integration [4][14] - The company aims to provide a single solution that combines VAT compliance and e-invoicing, which is expected to be a game changer for companies facing e-invoicing mandates [6][7] - The ongoing cloud migration cycle and business changes from mergers and acquisitions are seen as persistent tailwinds for growth [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the balance of 2025, noting no signs of a change in buyer behavior or a slowdown in indirect tax momentum [30] - The company highlighted that it has never experienced a year-over-year revenue decrease, even during recessionary periods, due to the consistent demand for automated tax solutions [17][20] - The management emphasized the importance of maintaining a strong pipeline and monitoring it closely as the year progresses [20] Other Important Information - The company ended the first quarter with over $270.4 million in unrestricted cash and cash equivalents, along with $300 million of unused availability under its line of credit [27] - For the second quarter of 2025, the company expects total revenue in the range of $182 million to $187 million, representing 14.5% year-over-year growth at the midpoint [28][29] Q&A Session Summary Question: What is driving larger customers to migrate to packaged software solutions? - Management noted that the increasing complexity of e-invoicing and audit pressures are prompting customers to seek more sustainable solutions [35][36] Question: Why did direct customers decline sequentially? - The decline was attributed to lower-end customers migrating away, while the focus remains on scaled customers, which grew by about 15% [38][39] Question: What is the impact of macroeconomic conditions on buyer behavior? - Management indicated that there has been no change in buyer behavior, and indirect tax discussions are becoming more strategic as companies move to the cloud [43][44] Question: How applicable is Kintsugi's technology to the Vertex tax business? - Kintsugi's technology is seen as a potential fit for small and mid-sized businesses, and there are opportunities to apply elements of their technology to Vertex's offerings [46][47] Question: What is Vertex's position on tariff-related products? - Vertex does not focus on tariff solutions as it is primarily an indirect tax provider, but discussions around supply chain changes have led to increased interest in e-invoicing and compliance [51][52] Question: How has the Ecosio product's general availability performed? - The general availability of the Ecosio product has been positive, with strong scalability in transaction processing being a key differentiator [55][56] Question: How is the competitive environment in e-invoicing compared to indirect tax? - Vertex differentiates itself by offering both e-invoicing and VAT compliance, which many competitors do not provide [70][71] Question: What is the outlook for new logo growth? - New logo growth has been diverse across key ecosystems, with a focus on enterprise customers, particularly in the SAP and Oracle ecosystems [78][80]

Vertex (VERX) came out with quarterly earnings of $0.15 per share, beating the Zacks Consensus Estimate of $0.13 per share. This compares to earnings of $0.15 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 15.38%. A quarter ago, it was expected that this company would post earnings of $0.14 per share when it actually produced earnings of $0.15, delivering a surprise of 7.14%.Over the last four quarters, the company has surpas ...

Financial Performance - Total revenues for Q1 2025 were $177.1 million, representing a 12.9% year-over-year increase[4] - Software subscription revenues reached $150.8 million, up 14.4% year-over-year[4] - Cloud revenues grew to $80.2 million, marking a 29.6% year-over-year increase[4] - Annual Recurring Revenue (ARR) was $618.5 million, up 17.9% year-over-year, with a 15.1% growth excluding acquisitions[4] - Net income for Q1 2025 was $11.1 million, compared to $2.7 million in the same period last year[4] - Non-GAAP net income was $24.5 million, with a diluted earnings per share (EPS) of $0.15[4] - Adjusted EBITDA for Q1 2025 was $37.2 million, with an adjusted EBITDA margin of 21.0%[4] - Total revenues for Q1 2025 reached $177,062 thousand, a 12.9% increase from $156,781 thousand in Q1 2024[34] - Software subscriptions revenue increased to $150,761 thousand, up 14.4% from $131,830 thousand year-over-year[34] - Gross profit for Q1 2025 was $112,994 thousand, compared to $95,792 thousand in Q1 2024, reflecting a gross margin improvement[34] - Non-GAAP gross profit for Q1 2025 was $132,772,000, up from $113,735,000 in Q1 2024, representing a 16.7% increase[38] - Non-GAAP gross margin improved to 75.0% in Q1 2025, compared to 72.5% in Q1 2024[39] - Non-GAAP net income increased to $24,494,000 in Q1 2025, compared to $23,431,000 in Q1 2024, reflecting a 4.5% growth[40] - Adjusted EBITDA for Q1 2025 was $37,219,000, slightly up from $36,743,000 in Q1 2024, with an adjusted EBITDA margin of 21.0%[42] - Non-GAAP operating income remained stable at $31,339,000 in Q1 2025, compared to $31,737,000 in Q1 2024[40] - Non-GAAP diluted EPS for both Q1 2025 and Q1 2024 was $0.15[40] Cash Flow and Assets - Free cash flow for Q1 2025 was $14,805 thousand, down from $24,566 thousand in Q1 2024, primarily due to increased capital expenditures[36] - Cash and cash equivalents at the end of Q1 2025 were $270,395 thousand, down from $296,051 thousand at the end of Q4 2024[32] - Free cash flow for Q1 2025 was $(12,250,000), a decline from $4,502,000 in Q1 2024, resulting in a free cash flow margin of (6.9)%[42] Expenses - Research and development expenses increased to $16,534,000 in Q1 2025 from $13,472,000 in Q1 2024, marking a 22.8% rise[39] - Selling and marketing expenses rose to $41,818,000 in Q1 2025, up from $35,674,000 in Q1 2024, indicating a 17.5% increase[39] Guidance and Outlook - The company expects Q2 2025 revenues to be between $182 million and $187 million[11] - Full-year 2025 revenue guidance is projected between $760 million and $768 million, with cloud revenue growth expected at 28%[11] - The company is optimistic about its long-term market opportunity in indirect tax automation despite recent geopolitical events[2] Balance Sheet - Total current assets decreased to $504,962 thousand as of March 31, 2025, from $536,333 thousand as of December 31, 2024[32] - Total liabilities decreased to $953,654 thousand as of March 31, 2025, compared to $987,439 thousand as of December 31, 2024[32] - The company reported a change in fair value of acquisition contingent earn-outs of $(14,700) thousand in Q1 2025, indicating adjustments related to acquisitions[34]

KING OF PRUSSIA, Pa., May 07, 2025 (GLOBE NEWSWIRE) -- Vertex, Inc. (NASDAQ: VERX) (“Vertex” or the “Company”), a leading global provider of indirect tax solutions, today announced financial results for its first quarter ended March 31, 2025. “Vertex continued to perform well in the first quarter, setting us up for a strong 2025,” said David DeStefano, Vertex’s President, Chief Executive Officer and Chairperson of the Board. “Our financial results were in line with our expectations for the quarter, and we m ...

Vertex Pharmaceuticals' (VRTX -9.39%) remarkable momentum came to a screeching halt this week. The big biotech stock had been up well over 20% year to date. However, Vertex's shares plunged after the company announced its first-quarter results on Monday. Should investors throw in the towel on Vertex? I don't think so. Instead, the sell-off presents a fantastic opportunity to double up on this big biotech innovator. Dissecting Vertex's bad news The main bad news with Vertex's Q1 results was that the company ...

Core Insights - Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) reported Q1 earnings that were decent but fell short of analyst estimates for both revenue and earnings [1] Financial Performance - The company experienced positive earnings surprises, which statistically have shown strong predictive power of stock price movements in the short term [1] Analyst Background - Dilantha De Silva, an experienced equity analyst with over 10 years in the investment industry, focuses on small-cap stocks often overlooked by Wall Street analysts [1]

Shares of Vertex Pharmaceuticals (VRTX -11.91%) were sinking 11.9% as of 10:18 a.m. ET on Tuesday. The sharp decline came after the company announced its 2025 first-quarter results on Monday evening.Vertex reported Q1 revenue of $2.77 billion, up 3% year over year. It posted adjusted earnings of $1.24 billion, or $4.76 per share, up from $1.05 billion, or $4.06 per share, in the prior-year period. However, both top- and bottom-line numbers missed the consensus Wall Street estimates. In addition, Vertex reve ...

Here's our initial take on Vertex Pharmaceuticals' (VRTX -0.27%) first-quarter financial report.Key MetricsMetricQ1 2024Q1 2025Changevs. ExpectationsTotal revenue$2.69 billion$2.77 billion+3%MissedAdjusted earnings per share$4.76$4.06-15%MissedTrikafta/Kaftrio revenue$2.48 billion$2.54 billion+2%n/aOther revenue$207 million$225 million+9%n/aVertex Hits a Speed BumpVertex's first-quarter financial results didn't keep up with what investors have gotten used to seeing in recent quarters. Revenue in Q1 rose jus ...