Revenue grew from $161.1M to $213.3M over the reported period with year-over-year growth decelerating to roughly 11%, while gross margin recovered to 65.7% but the operating margin of 0.1% in Q3 2026 suggests operating leverage has not yet appeared.
Vertex, Inc. (VERX) annual income statement — 8-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 |
|---|
| Sales/Revenue | 808.6M | 748.44M | 666.78M | 572.39M | 491.62M | 425.55M | 374.67M | 321.5M | 272.4M |
| Revenue Growth % | 10.44% | 12.25% | 16.49% | 16.43% | 15.53% | 13.58% | 16.54% | 18.02% | - |
| Cost of Goods Sold | 301.1M | 293.93M | 240.65M | 223.81M | 193.13M | 161.89M | 165.39M | 110.38M | 95.7M |
| COGS % of Revenue | - | 39.27% | 36.09% | 39.1% | 39.28% | 38.04% | 44.14% | 34.33% | 35.13% |
| Gross Profit | 507.5M | 454.51M | 426.13M | 348.58M | 298.49M | 263.66M | 209.28M | 211.12M | 176.71M |
| Gross Margin % | 62.76% | 60.73% | 63.91% | 60.9% | 60.72% | 61.96% | 55.86% | 65.67% | 64.87% |
| Gross Profit Growth % | - | 6.66% | 22.25% | 16.78% | 13.21% | 25.98% | -0.87% | 19.48% | - |
| Operating Expenses | 512.95M | 462.36M | 428.35M | 366.09M | 306.57M | 266.6M | 314.04M | 179.27M | 146.85M |
| OpEx % of Revenue | - | 61.78% | 64.24% | 63.96% | 62.36% | 62.65% | 83.82% | 55.76% | 53.91% |
| Selling, General & Admin | 404.63M | 368.35M | 323.41M | 286.17M | 246.99M | 206.01M | 248.47M | 139.14M | 115.84M |
| SG&A % of Revenue | - | 49.22% | 48.5% | 50% | 50.24% | 48.41% | 66.32% | 43.28% | 42.53% |
| Research & Development | 96.35M | 83.72M | 66.67M | 58.21M | 41.88M | 44.02M | 54.34M | 30.56M | 23.75M |
| R&D % of Revenue | - | 11.19% | 10% | 10.17% | 8.52% | 10.34% | 14.5% | 9.5% | 8.72% |
| Other Operating Expenses | 2M | 10.29M | 38.28M | 21.7M | 17.71M | 16.57M | 11.22M | 9.57M | 7.25M |
| Operating Income | -5.44M | -7.85M | -2.23M | -17.51M | -8.08M | -2.94M | -104.76M | 31.86M | -2.83M |
| Operating Margin % | -0.67% | -1.05% | -0.33% | -3.06% | -1.64% | -0.69% | -27.96% | 9.91% | -1.04% |
| Operating Income Growth % | - | -252.15% | 87.28% | -116.65% | -174.71% | 97.19% | -428.86% | 1224.43% | - |
| EBITDA | 112.67M | 89.08M | 84.51M | 56.95M | 53.07M | 41.84M | -72.54M | 57.05M | 22.07M |
| EBITDA Margin % | 13.93% | 11.9% | 12.67% | 9.95% | 10.79% | 9.83% | -19.36% | 17.74% | 8.1% |
| EBITDA Growth % | 28.28% | 5.41% | 48.39% | 7.31% | 26.84% | 157.68% | -227.17% | 158.5% | - |
| D&A (Non-Cash Add-back) | 118.11M | 96.93M | 86.74M | 74.46M | 61.15M | 44.78M | 32.22M | 25.19M | 24.9M |
| EBIT | -63.89M | 7.58M | 15.27M | -17.51M | -8.08M | -2.94M | -104.76M | 31.86M | -2.83M |
| Net Interest Income | 2.19M | 5.25M | 4.14M | -4.16M | -2.05M | -984K | -3.11M | -953K | -1.59M |
| Interest Income | 2.19M | 5.25M | 4.14M | 0 | 0 | 0 | 0 | 1.08M | 526K |
| Interest Expense | 0 | 0 | 0 | 4.16M | 2.05M | 984K | 3.11M | 2.04M | 2.12M |
| Other Income/Expense | 39.71M | 15.43M | 4.14M | -4.16M | -2.05M | -984K | -3.11M | -953K | -34.41M |
| Pretax Income | 34.27M | 7.58M | 1.91M | -21.67M | -10.13M | -3.93M | -107.87M | 30.9M | -4.43M |
| Pretax Margin % | 4.24% | 1.01% | 0.29% | -3.79% | -2.06% | -0.92% | -28.79% | 9.61% | -1.63% |
| Income Tax | 81.37M | 368K | 54.64M | -8.58M | 2.17M | -2.45M | -32.79M | -155K | 1.68M |
| Effective Tax Rate % | 237.44% | 4.86% | 2862.13% | 39.59% | -21.46% | 62.33% | 30.4% | -0.5% | -37.93% |
| Net Income | -47.1M | 7.21M | -52.73M | -13.09M | -12.3M | -1.48M | -75.08M | 31.06M | -6.11M |
| Net Margin % | -5.83% | 0.96% | -7.91% | -2.29% | -2.5% | -0.35% | -20.04% | 9.66% | -2.24% |
| Net Income Growth % | 12.1% | 113.68% | -302.73% | -6.41% | -731.91% | 98.03% | -341.75% | 608.63% | - |
| Net Income (Continuing) | -47.1M | 7.21M | -52.73M | -13.09M | -12.3M | -1.48M | -75.08M | 31.06M | -6.11M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -0.29 | 0.04 | -0.34 | -0.09 | -0.08 | -0.01 | -0.60 | 0.21 | -0.05 |
| EPS Growth % | 16.65% | 111.76% | -277.78% | -12.5% | -700% | 98.33% | -385.71% | 545.86% | - |
| EPS (Basic) | - | 0.05 | -0.34 | -0.09 | -0.08 | -0.01 | -0.60 | 0.21 | -0.05 |
| Diluted Shares Outstanding | 162.09M | 180.28M | 155.09M | 151.86M | 149.65M | 147.78M | 131.51M | 146.17M | 129.63M |
| Basic Shares Outstanding | 162.09M | 144.22M | 155.09M | 151.86M | 149.65M | 147.78M | 131.51M | 146.17M | 124.33M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | 91.98% | - |
Quick answers to the most common questions about buying VERX stock.
For fiscal year 2025, Vertex, Inc. (VERX) reported total revenue of $748.4M. This represents a 174.8% increase compared to $272.4M in 2018.
Vertex, Inc. (VERX) is profitable, generating $7.2M in net income for the fiscal year ending 2025 with a net profit margin of 1.0%.
Vertex, Inc. (VERX) reported an operating income of $-7.8M, resulting in an operating profit margin of -1.0%. This margin reflects the operational efficiency of the business before interest and taxes.
Vertex, Inc. (VERX) generated $454.5M in gross profit for the year, representing a gross profit margin of 60.7%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Margin expansion execution risk
Metrics are mathematically derived from official filings.
Steady Top-Line Growth Above Ten Percent
Based on reported quarterly figures, Vertex's revenue grew from $161.1M in Q2 2024 to $213.3M in Q3 2026, with year-over-year growth holding near 10.5% to 11.1% in recent quarters after peaking at 17.5% in Q3 2024, suggesting deceleration from the earlier pace.
The reported figures suggest growth has moderated from the mid-teens into a low double-digit range, which may reflect the transition from upfront license recognition toward ratable SaaS revenue rather than a demand slowdown. Investors should monitor whether the recent guidance raise to $215.0M-$217.0M reflects durable momentum or timing effects from the legacy-to-cloud shift.
Gross Margin Rebuilding but Below Pure-Play SaaS
As reported in the quarterly income statements, Vertex's gross margin recovered from 59.4% in Q1 2026 to 65.7% in Q3 2026, though this remains well below the margins typical of pure-play software peers.
The recovery suggests improving cloud delivery economics or a favorable mix shift, but the persistent gap versus pure SaaS likely reflects the continued weight of lower-margin professional services and legacy infrastructure costs. Whether margins can structurally expand further depends on how quickly the services mix declines as enterprise implementations mature.
Operating Leverage Not Yet Visible
Based on Vertex's reported figures, operating income swung from a $4.5M profit in Q1 2025 to a -$3.0M loss in Q1 2026, with the operating margin hovering near breakeven at 0.1% in the latest quarter despite revenue rising to $213.3M.
Operating expenses have grown roughly in line with gross profit, indicating limited evidence that fixed-cost absorption is translating into incremental margin. The data does not clearly show SG&A efficiency gains, so the leverage thesis remains unproven and warrants continued monitoring.
Net Income Volatility Obscures Underlying Trend
According to reported financial statements, Vertex's net income has oscillated sharply between quarters, from a $67.8M loss in Q4 2024 to a $46.6M loss in Q3 2026, with stock-based compensation running between $10M and $21M per quarter.
The sizable swings in net income appear driven by non-operating items and tax effects rather than operating performance alone, making the GAAP earnings stream difficult to read cleanly. Stock-based compensation represents a meaningful share of revenue, which may explain much of the gap between GAAP and adjusted profitability and warrants scrutiny.
Thin Profitability Leaves Little Margin for Error
Based on reported figures, Vertex's trailing operating margin of -1.0% and return on equity of 3.3% suggest limited earnings cushion, while a debt-to-equity ratio of 1.39 could constrain flexibility if ERP vendors expand native tax capabilities.
The bear case centers on whether the cloud transition produces the margin expansion the market appears to be pricing in, as continued thin profitability could support a lower multiple. Increased native tax investment by major ERP providers may pressure third-party attach rates in the mid-market, and the company's leverage would limit its ability to respond aggressively.