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Jun 30
Vertex Q2 2025 Earnings Report
Vertex reported its second quarter 2025 financial results, showing double-digit revenue growth and healthy profitability and cash flow.
Key Takeaways
Vertex delivered Q2 2025 results in line with expectations, achieving significant revenue growth driven by software subscriptions and cloud services. Despite a net loss for the quarter, non-GAAP net income remained strong, and the company maintained healthy cash flow. However, extended sales cycles impacted the full-year revenue guidance.
Total revenues increased by 14.6% year-over-year to $184.6 million.
Software subscription revenues grew by 15.7% year-over-year, reaching $157.8 million.
The company reported a GAAP net loss of $1.0 million, compared to a net income of $5.2 million in the prior year period.
Annual Recurring Revenue (ARR) increased by 16.1% year-over-year to $636.6 million.
Vertex
Vertex
Vertex Revenue by Segment
Revenue by Segment
Software Subscriptions Revenue
CapyFin.comServices Revenue
CapyFin.comCloud Revenue
CapyFin.com Forward Guidance
Vertex provided financial outlook for Q3 2025 and full-year 2025, with revenues expected to be between $190.0 million and $193.0 million for Q3, and $750.0 million to $754.0 million for the full year. Adjusted EBITDA is projected to be $38.0 million to $40.0 million for Q3 and $156.0 million to $160.0 million for the full year. The full-year revenue guidance was reduced due to extended sales cycles and delayed customer decision-making.
Positive Outlook
- Continued optimism about the future for Vertex.
- Indirect taxes are growing in complexity, increasing customer need for solutions.
- ERP cloud conversions are expected to be a durable long-term growth driver.
- Proliferation of e-invoicing mandates globally is expected to be a durable long-term growth driver.
- Underlying demand for solutions remains strong.
Challenges Ahead
- Extended sales cycles impacted the timing of new contract signings in Q2 2025.
- Delayed customer decision-making impacted the timing of new contract signings in Q2 2025.
- Full-year 2025 expected revenue guidance was reduced.
- Adjusted EBITDA margin is projected to decrease for the full year compared to the previous year's reported value.
- The company does not intend to update its financial outlook until its next quarterly results announcement.
Revenue & Expenses
Visualization of income flow from segment revenue to net income