Here are 1-3 brief analogies to describe Vertex (VERX):

• An Intuit (TurboTax/QuickBooks) for large corporations, automating complex enterprise tax calculations and compliance.
• Like a Stripe or Adyen for corporate taxes, providing the backend infrastructure to automate complex tax determination and compliance for businesses.
• A specialized SAP or Oracle, but solely focused on enterprise tax technology and compliance.

• Indirect Tax Determination & Calculation Software: A suite of cloud and on-premise software solutions that automatically calculate sales tax, use tax, VAT, and GST for business transactions globally.
• Tax Returns Software & Services: This product automates the preparation, filing, and remittance of indirect tax returns to various tax authorities worldwide.
• Tax Data Management & Analytics: Tools and services that help businesses manage their tax-related data, support audits, and provide actionable insights into tax liabilities and processes.

Vertex (symbol: VERX) primarily sells its tax technology solutions to other companies, making it a B2B (business-to-business) provider.

Vertex serves a highly diversified customer base, and according to its financial filings (e.g., 2023 10-K), no single customer accounts for more than 1% of its total revenue. As such, there are no individually identifiable "major customer companies" that can be listed by name and stock symbol.

Instead, Vertex's customer base consists of a broad range of businesses, primarily characterized by:

• Large Enterprises and Mid-Market Companies: Businesses that require sophisticated and scalable tax automation solutions to manage complex transaction taxes across multiple jurisdictions.
• Diverse Industries: Customers span a wide array of sectors, including retail, manufacturing, food and beverage, lodging, utilities, energy, communications, financial services, and others, all needing to comply with evolving tax regulations.
• Companies with Complex Tax Needs: Businesses that face challenges in calculating, collecting, and remitting sales tax, use tax, value-added tax (VAT), and other indirect taxes, often across numerous products, services, and geographical locations.

• Amazon Web Services (AWS), a subsidiary of Amazon.com, Inc. (AMZN)
• Microsoft Azure, a service of Microsoft Corporation (MSFT)

The public company Vertex (VERX) faces several key business risks, primarily stemming from external economic pressures and the competitive, rapidly evolving technology landscape.

1. Macroeconomic Slowdown and Customer Spending: A significant risk for Vertex is the impact of global economic uncertainty, which can lead to reduced IT budgets and delayed purchasing decisions among its enterprise customers. This macroeconomic slowdown has resulted in elongated sales cycles and a decline in customer expansion, as evidenced by a slipped Net Revenue Retention (NRR) rate in Q3 2025 (107%, down from 111% a year prior), signaling slower growth from existing customers. This caution has directly led to trimmed revenue guidance for full-year 2025.
2. Competition and Technological Disruptions: Vertex operates in a highly competitive industry characterized by rapid technological advancements and evolving customer needs. The emergence of new tax compliance technologies, changes in software delivery models, and the presence of competitors offering similar or more advanced solutions pose a continuous threat to Vertex's market position. Maintaining competitiveness requires ongoing innovation and adaptation to these shifting market dynamics.
3. Reliance on Software Subscription Revenue and Managing Operational Costs: While Vertex benefits from a highly recurring revenue model through software subscriptions, this heavy reliance means that any shifts in market demand or increased competitive pressures affecting subscription renewals could disproportionately impact the company's financial performance. Furthermore, Vertex has experienced an uptick in operational costs, particularly in selling and marketing, with a 16.9% increase for the nine months ended September 30, 2025. This increase in operating expenses, despite revenue growth, has impacted GAAP profitability, highlighting the challenge of managing costs while investing in growth initiatives like cloud transition and AI-led product acceleration.

Vertex, Inc. (VERX) primarily provides tax automation software solutions for enterprises, focusing on indirect tax processes, as well as broader tax determination, compliance, reporting, and data management services.

The addressable markets for Vertex's main products and services can be broadly categorized under the global and North American "Tax Technology" (Tax Tech) and "Tax Software" markets.

Global Market Sizes:

• The global Tax Tech market was valued at approximately USD 18.45 billion in 2024. This market is projected to grow to approximately USD 60.66 billion by 2034, exhibiting a Compound Annual Growth Rate (CAGR) of 12.64% from 2025 to 2034. Other estimates place the global Tax Tech market at USD 18.53 billion in 2024, expected to reach USD 36.72 billion by 2030 with a CAGR of 12.1%.
• The overall global Tax Software market reached USD 20.53 billion in 2025 and is forecast to attain USD 37.08 billion by 2030, advancing at a 12.55% CAGR during 2025-2030.
• Within the broader tax software market, indirect-tax solutions, which are a focus for Vertex, are projected to register the fastest growth with a 15.81% CAGR to 2030.

North American Market Sizes:

• North America is a dominant region in the global Tax Tech market, holding a 39% share in 2024.
• The North American Tax Tech market size was estimated at USD 7.20 billion in 2024 and is expected to expand at a CAGR of 12.78% from 2025 to 2034.
• Another report indicates the North America Automated Tax Software market size was USD 7.46 billion in 2024 and is projected to reach USD 13.08 billion by 2031, growing at a CAGR of 7.1% from 2024 to 2031.
• The North America Tax Software market was valued at approximately US$ 6.79 billion in 2022 and is projected to reach US$ 14.18 billion by 2030, with a CAGR of 9.6% from 2022 to 2030.

Expected Drivers of Future Revenue Growth for Vertex (VERX)

Over the next 2-3 years, Vertex (VERX) is expected to drive future revenue growth through several key initiatives and market trends:

1. Continued Growth in Cloud Revenue: Vertex anticipates robust growth in its cloud-based tax solutions. The company projects cloud revenue growth of 28% for the full year 2025. This growth is fueled by the ongoing industry shift towards cloud-based tax compliance solutions, where Vertex is strategically positioned to capture market share. Cloud revenue has consistently demonstrated strong year-over-year increases, such as 29.6% in Q3 2025 and 29.9% in Q2 2025.
2. Expansion of E-invoicing Services and Regulatory Mandates: Significant opportunities are expected from the expansion of e-invoicing services, particularly in Europe. Regulatory mandates for e-invoicing in countries like France and Germany, starting in 2026, are projected to attract a substantial number of new enterprise customers, thereby strengthening recurring revenue.
3. Leveraging ERP Cloud Migration Cycles: Vertex's growth is also supported by the ongoing migration cycles to modern ERP systems, specifically SAP S/4HANA and Oracle Cloud. These migrations create a strong pipeline for Vertex, as businesses upgrade their cloud ERP systems and require integrated tax solutions. The demand for Vertex's integrations and subscription services is expected to increase as these migration deadlines approach over the next two years.
4. Increasing Complexity of Global Indirect Tax Regulations: The escalating complexity of indirect taxes worldwide is a significant driver. As global tax regulations become more intricate and subject to frequent changes, businesses increasingly rely on Vertex's platforms to maintain compliance. This trend, coupled with expanding country coverage, accelerates the adoption of Vertex's tax compliance solutions.
5. Growth in Average Annual Revenue Per Customer (AARPC) and Customer Base: Vertex has demonstrated consistent growth in its Average Annual Revenue Per Customer (AARPC), with Vertex standalone AARPC increasing by 17.5% in Q3 2024 to $132,422. The company also continues to expand its base of scaled customers (those with annual revenues greater than $100,000), showing a 15% year-over-year growth in Q1 2025. Strong net revenue retention (NRR), reported at 107% in Q3 2025, further indicates successful expansion within its existing customer base.

Share Repurchases

• Vertex, Inc. authorized its first stock repurchase program on November 3, 2025, enabling the buyback of up to $150 million of its Class A common stock.
• The program has no specified expiration date and allows for repurchases through various means, including open market and privately negotiated transactions.
• This authorization reflects the company's belief that its stock is undervalued and permits the repurchase of up to 4.1% of its outstanding shares.

Share Issuance

• Vertex completed its Initial Public Offering (IPO) on July 31, 2020, offering 21,150,000 shares of Class A common stock at $19.00 per share.
• In November 2022, a selling stockholder completed an underwritten offering of 1,500,000 shares of Class A common stock at $15.15 per share; Vertex did not receive any proceeds from this sale.
• In April 2024, Vertex announced a proposed private offering of $250 million in convertible senior notes due 2029, which may be settled in cash, shares of Class A common stock, or a combination upon conversion.

Inbound Investments

• In connection with the tender offer to acquire Pagero Group AB, Vertex indicated an issuance of Convertible Preferred Stock, contingent on the acquisition's closing, which carries an 11.75% payment-in-kind dividend and is convertible into Vertex common stock.

Outbound Investments

• Vertex completed the acquisition of ecosio, a B2B integration provider, on August 30, 2024, for an upfront cash payment of $69 million and a targeted earn-out of $76 million in cash and $35 million in Vertex shares.
• In December 2023, Vertex launched a public tender offer to acquire 100% of Pagero Group AB (publ) shares for approximately $555 million, aiming to enhance its e-invoicing and indirect tax solutions.
• The company also acquired tax-specific AI capabilities from Ryan, LLC in June 2024, with undisclosed financial terms, to improve tax mapping efficiency and accuracy.

Capital Expenditures

• Capital expenditures were approximately $68.2 million in 2023, $60.4 million in 2022, and $43.4 million in 2021.
• For the trailing twelve months ending October 2025, capital expenditures were $32.8 million.
• Primary areas of focus for capital allocation include organic investments in research and development, new product development, and tax content enhancements.