Vertex Inc (VERX) Reports Strong Q3 2023 Results with Increased Guidance
Vertex Inc (NASDAQ:VERX) announced robust third-quarter results, with a significant rise in software subscription revenues.
Management increases full-year guidance for revenue and Adjusted EBITDA, reflecting confidence in the company's financial trajectory.
Non-GAAP financial measures show a healthy gross margin and a solid increase in Adjusted EBITDA.
Vertex Inc (NASDAQ:VERX) continues to expand its customer base, with direct customers growing to 4,303 in Q3 2023.
Vertex Inc (NASDAQ:VERX), a leading global provider of indirect tax solutions, released its financial results for the third quarter ended September 30, 2023, on November 9, 2023. The company reported strong financial performance, with President, CEO, and Chairperson David DeStefano commenting,
We delivered strong results in the third quarter, reflecting our recent growth investments."
He further emphasized the company's solid execution and competitive position in the enterprise segment.
Financial Highlights
For the third quarter of 2023, Vertex Inc (NASDAQ:VERX) saw its software subscription revenues climb to $121.3 million, up from $106.4 million in the same period last year. Services revenue also increased to $23.7 million from $19.9 million. The total revenue for the quarter reached $145 million, a substantial improvement from $126.2 million in Q3 2022.
Despite these gains, the company experienced a net loss of $3.4 million, which was attributed to increased operating expenses, including research and development, selling and marketing, and general and administrative expenses. However, non-GAAP financial measures painted a more favorable picture, with non-GAAP gross profit standing at $103.4 million and Adjusted EBITDA at $26.6 million for the quarter.
Balance Sheet and Cash Flow
Vertex Inc (NASDAQ:VERX) ended the quarter with $49.5 million in cash and cash equivalents. The balance sheet also showed a total asset value of $720.1 million. The company's cash flow from operations was positive, contributing to a free cash flow of $9.1 million for the quarter.
Customer Growth and Retention
Vertex Inc (NASDAQ:VERX) continued to expand its customer base, ending the quarter with 4,303 direct customers, up from 4,230 in Q3 2022. The company's focus on customer retention and expansion is evident in its Net Revenue Retention Rate (NRR) and Gross Revenue Retention Rate (GRR), which are key indicators of the company's ability to maintain and grow its customer revenues.
Outlook and Guidance
Chief Financial Officer John Schwab expressed confidence in the company's financial outlook, stating,
Throughout the first nine months of 2023, we have consistently exceeded our financial expectations."
As a result, Vertex Inc (NASDAQ:VERX) is raising its full-year guidance for both revenue and Adjusted EBITDA.
Investors and stakeholders can access more details about Vertex Inc (NASDAQ:VERX)'s financial performance by joining the conference call or webcast hosted by the company. The replay will be available until November 23, 2023.
For more information on Vertex Inc (NASDAQ:VERX) and its financial results, please visit Vertex Inc's Investor Relations website.
Vertex Inc (NASDAQ:VERX) continues to demonstrate its ability to navigate the complexities of the global tax environment, delivering solutions that are critical for businesses worldwide. With a strong financial performance in Q3 2023 and an optimistic outlook for the remainder of the year, Vertex Inc (NASDAQ:VERX) is well-positioned for sustained growth and profitability.
Explore the complete 8-K earnings release (here) from Vertex Inc for further details.
This article first appeared on GuruFocus.
