Q4 2025 Vertex Inc Earnings Call Transcript
Key Points
- Vertex Inc (VERX) reported fourth-quarter revenue of $194.7 million, in line with guidance, and adjusted EBITDA exceeded the high end of guidance at $42.5 million.
- The company achieved double-digit revenue growth for the full year, with total revenue up 12.2% from 2024.
- Vertex Inc (VERX) has a strong blue-chip customer base, including over 60% of the Fortune 500, and is recognized for its domain expertise in indirect tax solutions.
- The company is making significant investments in AI, with new offerings like smart categorization and Vertex Copilot, aimed at enhancing customer workflows and reducing manual tasks.
- Revenue from new logos increased by 20% in 2025, driven by competitive takeaways and customers transitioning from homegrown solutions to Vertex Inc (VERX).
- Vertex Inc (VERX) experienced higher customer attrition in 2025, particularly among smaller accounts with annual revenue under $50,000.
- The company faced a moderation in new upsell and cross-sell revenue, impacting retention metrics.
- Lower entitlement growth and slightly higher customer attrition affected the company's overall growth in 2025.
- True-up revenue in 2025 was approximately $10 million lower than in 2024, reducing the full-year revenue growth rate by nearly 2 percentage points.
- The company noted challenges in the timing and predictability of tax engine decisions during customer migrations to SAP S/4HANA, affecting expected growth from this segment.
Good day, and welcome to the Vertex fourth-quarter 2025 earnings conference call. (Operator Instructions) Please note, this event is being recorded. I would now like to turn the conference over to Joe Crivelli, Vice President, Investor Relations. Please go ahead.
Hello, and thanks for joining us to discuss Vertex's fourth-quarter results. Chris Young, our President and CEO; and John Schwab, our CFO, are also with us today.
During this call, we may make forward-looking statements about expected future results. Actual results may differ due to risks and uncertainties. These risks and uncertainties are described in our filings with the Securities and Exchange Commission.
Our remarks today will also include references to non-GAAP metrics. A reconciliation of these metrics to GAAP is also provided in today's press release. This call is being recorded and will be available for replay on our Investor Relations website. I'll now turn the call over to Chris.
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