Vertex, Inc. Class A Common Stock Goldman Sachs Communacopia + Technology Conference 2026

Well, first of all, thanks for having us here. A couple of points I think that are really important. Vertex really exists to help our customers manage their tax and compliance across a full life cycle of activity. We've been calling that Decision-to-Defense because we've grown up as a tax calculation company. That's what Vertex was known for. We're 45 years old. But if you think about a customer's compliance requirement, it cuts across that entire life cycle from how you categorize a product, all the way through to how you calculate, prove compliance, file, pay, and then ultimately defend yourself if you find yourself in an audit. And that's a life cycle. It goes on continuously. What you learn at the end of that process needs to get filtered back into the upstream part of it.

Traditionally, we focused more on the front end, the calculation piece. With our entry into e-invoicing, we're now more across the compliance spectrum. But we think there's real opportunity for us to expand and really help our customers tackle a lot of the manual work that happens across that entire life cycle. Case in point, yesterday I was with a customer, very large, well-known retailer out of the western part of the country here, and they were describing to me, "Hey, we close our year in August, and guess what? We have a bunch of spreadsheets that we're using to close the year, close the quarter.

We're pulling data from you guys and a bunch of other places in order to pull all the numbers together." We believe the close process, the reconciliation process, the audit process, so many of these that we can help our customers just do faster, go more quickly by bringing more AI capability to that as part of the entire Decision-to-Defense life cycle. In five years' time, we want our customers to be able to look back at us and say, "We can close faster. We can do it with more confidence. We can do it with less reliance on third-party outsourcing and that sort of thing to get to the right answer." And that's really what Vertex should bring.

I think we have several opportunities. I think, first of all, the market opportunity is there. We have a very durable customer base. We have over 60% of the Fortune 500 work with Vertex already. We have a substantial share in large global manufacturers outside of the U.S. and large retailers outside of the U.S. We've seen substantial growth now from a small base, but it's really starting to materialize in our e-invoicing business. I've been talking a lot about this over the course of the last couple of months. That part of our business is now becoming more established as part of Vertex. We think the opportunities are all there. The pieces now that we're layering in are several fold. The first one is AI internally to how we work, getting more efficient, more effective.

We've talked about our value creation plan at Vertex, which is going to drive more expansion of our Cash EBITDA, which also will drive growth in our free cash flow numbers for the business. John showed a chart at the end of our earnings in the last cycle, where we showed the growth and what we're driving from an EBITDA less CapEx perspective in the business. So you can already see with the VCP, we're driving more growth on the bottom line. That's supported by what we're doing from an AI perspective. We've been able to bring down contractor counts. We're changing how we develop software. We're changing how we support our customers. We're changing how we implement. We're changing how we operate most of our processes inside the company using AI, and we're really in the middle of that.

As we exit 2026 going into 2027, operationally, we expect to see the full pull-through from that. That's on the internal side as it relates to our customer base. We've started to introduce a few revenue-generating products. We've got more coming in our pipeline. As we look out into 2027, we think AI, as I mentioned, going after some of those manual workflows that our customers have today offers us more opportunity as we look out in the future.

I think for us, we've got a lot of different pieces to the business that we need to make sure all come together well, so we can continue to drive growth. For example, we've had to do a few acquisitions to participate in the e-invoicing opportunity. We bought ecosio two years ago. We just recently acquired Brinta. They've become a good part of Vertex, but integrating all these pieces is something we're working through. We have to make sure that we're ready for the mandates. Like, for example, the French mandate came online two weeks ago, September 1st. That's gone well so far, so we're pleased with where we are on that. We've got Germany coming, we've got Spain next year. Making sure that we're ready for each one of these is an important part of what we're doing.

But so far, operationally, we've been able to hold up really well as these mandates are coming along, and we're seeing growth in the business as a result.

E-invoicing is one of our biggest opportunities there because a lot of our growth over the years has been to expand the use of the tax engine across different parts of our customer's franchise. While some of those opportunities are still there, I will go back and reference the customer I was with yesterday. One of the conversations with that customer is to expand, even though they are a large Vertex customer, they are a seven-figure-a-year customer. Even with them, there is an opportunity to expand calculation in their franchise to other parts of their business. So there is still a durable growth opportunity, we believe, in the core part of our business. But where we see real growth, like more kind of near-term growth opportunities, is to be able to cross-sell, up-sell e-invoicing into our install base.

We started to see in the second quarter the first real signs of that, where some of our core Vertex customers who had been using us for determination were buying larger packages of e-invoicing for their franchise. That was for France. Even looking backwards across other economies like Belgium, Italy. Poland was another driver. Several of them are looking forward to Germany, and so we are starting to see some activity right now in the pipeline around Germany. Then we have got our eyes on Spain, which comes next year.