Vertex, Inc. ( (VERX) ) has released its Q3 earnings. Here is a breakdown of the information Vertex, Inc. presented to its investors.
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Vertex, Inc., a prominent player in the indirect tax solutions sector, delivers tax technology aimed at helping global businesses manage and comply with tax regulations effectively. In the third quarter of 2024, Vertex, Inc. reported a strong financial performance, surpassing its revenue guidance with a notable 17.5% year-over-year increase in total revenues, marking a significant achievement for the company. The company also completed the acquisition of ecosio, enhancing its global cloud platform capabilities, which has been well-received by customers.
Key financial metrics for the third quarter included a total revenue of $170.4 million, with software subscription revenues climbing by 20.6% year-over-year. The cloud segment showed remarkable growth, with revenues increasing by 29.9%. Vertex’s Annual Recurring Revenue (ARR) rose by 19% year-over-year, partially influenced by acquisitions, while maintaining a stable Net Revenue Retention (NRR) of 111%. The company successfully turned around its operations with a net income of $7.2 million compared to a loss in the previous year, reflecting its strategic efforts in achieving profitability.
Vertex’s adjusted EBITDA reached $38.6 million, demonstrating a strong margin improvement compared to the same period last year. The recent acquisitions, including ecosio and Systax, are expected to drive future growth, with a focus on e-invoicing regulations and ERP conversions that present significant opportunities for the company. The acquisition of ecosio added $8.1 million to ARR, and Vertex anticipates it will contribute $3 million to fourth-quarter revenue.
Looking ahead, Vertex is optimistic about its growth trajectory, projecting revenues between $175 million and $178 million for the fourth quarter of 2024. For the full year, the company expects revenues to reach up to $666.3 million, with continued strong growth in the cloud segment and an adjusted EBITDA forecasted between $146.9 million and $150.9 million. The management remains confident that the strategic acquisitions and the expanding global cloud platform will sustain the company’s profitable growth in the coming years.
