NASDAQ$VERX

Vertex Inc · Q1 2022 earnings

Q1 2022 earnings · · Investor relations

Briefing

Vertex's first quarter performance in 2022 showed revenue acceleration and strategic investments driving growth and market leadership.

Vertex announced strong first quarter results with a 17% increase in total revenues year-over-year, driven by software subscriptions and cloud revenues. The company saw continued growth in ARR and NRR rates, and refinanced its credit facility to increase operational flexibility.

  • Total revenues increased by 17.0% year-over-year, reaching $115.0 million.
  • Software subscription revenues grew by 16.6% year-over-year, totaling $97.1 million.
  • Cloud revenues experienced substantial growth, increasing by 42.1% year-over-year to $38.3 million.
  • ARR increased by 18.9% year-over-year, reaching $380.6 million.

Headline financials

Total Revenue

$115M

Previous: $98.2M+17.0%
EPS (adj)

$0.08

Previous: $0.07+14.3%
Annual Recurring Revenue

$381M

Previous: $320M+18.9%
Capital Expenditures

-$13.9M

Previous: -$6.2M-123.9%
Free Cash Flow

-$14.2M

Previous: -$3.91M-263.6%
Net Income

-$334K

Previous: $2.29M-114.6%
Operating Income

$468K

Previous: $2.14M-78.2%
Gross Profit

$70.1M

Previous: $61.3M+14.4%
Cash & Equivalents

$97.3M

Previous: $278M-64.9%
Total Assets

$698M

Previous: $558M+24.9%

Revenue & EPS history

Vertex · Revenue · Quarterly

$115M

Q1 2022+17%vs Q1 2021
Beat estimate in 9 of 10 quarters(90%)
ActualEstimate

Revenue by segment

Vertex · $17.9M total across 1 segment · Q1 2022

  • Services
    $17.9M

Forward guidance

For the second quarter of 2022, the Company currently expects revenues of $116.0 million to $117.5 million, representing growth of 11% to 12% from the second quarter of 2021; and Adjusted EBITDA of $16.0 million to $18.0 million, representing a decrease of $1.2 million to $3.2 million from the second quarter of 2021.

Tailwinds

  • Revenues of $116.0 million to $117.5 million, representing growth of 11% to 12% from the second quarter of 2021
  • Cloud revenue growth of 33% from the full-year 2021
  • Revenues of $479 million to $483 million, representing growth of 13% to 14% from the full-year 2021
  • Ongoing investment in research and development
  • Ongoing investment in selling and marketing expenses to drive growth

Headwinds

  • Adjusted EBITDA of $16.0 million to $18.0 million, representing a decrease of $1.2 million to $3.2 million from the second quarter of 2021
  • Adjusted EBITDA of $72 million to $75 million, representing a decrease of $3 million to $6 million from the full-year 2021
  • The Company is unable to reconcile forward-looking Adjusted EBITDA to net income (loss)
  • The Company is currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact net income (loss) for these periods but would not impact Adjusted EBITDA
  • Actual results may differ materially

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2022

Historical avgQ1 2022

+0.5%

Avg return

Earnings day

+0.3%

Avg return

5 days after

+4.2%

Avg return

30 days after

50%

12 / 24 earnings

Positive

+32.1%

Q4 2023

Best reaction

-20.9%

Q4 2020

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-5.2%+6.8%+3.9%
Q4 2025-13.8%-14.3%-10.6%
Q3 2025-8.5%-14.8%-13.6%
Q2 2025-18.0%-24.4%-27.3%
Q1 2025-3.1%-3.3%+6.1%
Q4 2024-19.0%-24.4%-16.6%
Q3 2024+17.4%+12.8%+28.8%
Q2 2024-1.4%-1.5%-2.5%
Q1 2024+1.3%+5.1%+13.7%
Q4 2023+32.1%+17.9%+25.0%
Q3 2023+21.3%+23.7%+27.6%
Q2 2023+8.2%+9.9%+23.1%
Q1 2023-5.9%-7.0%+8.7%
Q4 2022+20.2%+21.2%+48.4%
Q3 2022+11.3%+3.1%-7.0%
Q2 2022+10.1%+10.4%+13.6%
Q1 2022-19.7%-5.5%-13.2%
Q4 2021+1.1%-5.6%+16.0%
Q3 2021+1.4%+1.1%-14.2%
Q2 2021-0.2%+3.0%+1.7%
Q1 2021+13.5%+20.4%+16.7%
Q4 2020-20.9%-16.6%-34.3%
Q3 2020-10.2%-8.8%-1.2%
Q2 2020+0.7%-2.0%+8.4%
Q1 2020
Q4 2019
Q3 2019
Q2 2019
Q1 2019

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