GMV and total revenue YoY growth reached 22% and 25%, respectively
Gross profit increased by 37% YoY, representing a margin expansion of 641 bps
Non-GAAP operating income and free cash flow margins reached 6% and 4%
NEW YORK--(BUSINESS WIRE)-- VTEX (NYSE: VTEX), the composable and complete commerce platform for premier brands and retailers, today announced results for the first quarter of 2024 ended March 31, 2024. VTEX results have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”) IAS 34 Interim Financial Reporting.
Geraldo Thomaz Jr., founder and co-CEO of VTEX, commented, “Our product launches are revolutionizing commerce for IT and business teams to deliver sustainable growth with attractive ROI. By creating new revenue streams, we are extending the runway for long-term growth while continuing to deliver meaningful operational leverage and margin improvements. We are excited for VTEX's future, focused on growth, margin expansion, and customer success.” Mariano Gomide de Faria, founder and co-CEO of VTEX, added, “We started the year backed by recognitions from Gartner and IDC, and we are translating this momentum into meaningful sales. Our expansion into Germany, with customers like OBI, encourages us on our global expansion while sustained sales momentum in Brazil highlights our long-term growth potential. Customer feedback on our value proposition for B2B and B2C reinforces our vision as the global backbone for connected commerce.”
First Quarter 2024 Financial Highlights
First Quarter 2024 Commercial Highlights:
First Quarter 2024 Operational Highlights:
We innovate aligned with our guiding principles. We express our brand through the success of our customers. VTEX key operational highlights this quarter are:
Business Outlook
Although the macroeconomic scenario remains uncertain, we see VTEX well positioned to capture an attractive market opportunity. We are closely monitoring the performance of our customers and sales funnel and taking necessary actions to ensure our business' sustainable growth and success. We remain encouraged by our sales momentum and operational leverage, despite weakness in Argentina.
In this context, we are currently targeting revenue for the second quarter of 2024 in the US$54.5 million to US$56.0 million range, implying a YoY growth of 18% on an FX neutral basis in the middle of the range.
For the full year 2024, we continue executing our strategy for profitable growth. Recognizing heightened volatility in Argentina’s macro situation, we are targeting FX neutral YoY revenue growth of 16% to 20%, implying a range of US$234 million to US$243 million based on April’s average FX rate. Further demonstrating our operational leverage, we are targeting free cash flow and non-GAAP operating income margins of high single digits.
We are confident in VTEX's ability to navigate the uncertainties posed by the current macroeconomic scenario. We are empowering our customers to digitally transform their commerce operations while helping them to outperform the market.
The business outlook provided above constitutes forward-looking information within the meaning of applicable securities laws and is based on a number of assumptions and subject to a number of risks. Actual results could vary materially as a result of numerous factors, including certain risk factors, many of which are beyond VTEX’s control. See the cautionary note regarding ''Forward-Looking Statements'' below. Fluctuations in VTEX’s operating results may be particularly pronounced in the current economic environment. There can not be an assurance that VTEX will achieve these results.
The following table summarizes certain key financial and operating metrics for the three months ended March 31, 2024 and 2023.
Three months ended
March 31,
(in millions of US$, except as otherwise indicated)
2024
2023
GMV
4,036.9
3,303.7
GMV growth YoY FXN (1)
20.1%
20.6%
Revenue
52.6
42.3
Revenue growth YoY FXN (1)
21.3%
22.2%
Non-GAAP subscription gross profit (2)(4)
38.9
29.4
Non-GAAP subscription gross profit margin (3)(4)
77.2%
73.9%
Non-GAAP income (loss) from operations (4)
3.0
(4.1)
Total number of employees
1,334
1,339
1) Calculated by using the average monthly exchange rates for the applicable months during 2023, adjusted by inflation in countries with hyperinflation, and applying them to the corresponding months in 2024, as applicable, so as to calculate what our results would have been had exchange rates remained stable from one year to the next. (2) Corresponds to our subscription revenues minus our subscription costs. (3) Corresponds to our subscription gross profit divided by subscription revenues. (4) Reconciliation of Non-GAAP metrics can be found in tables below.
Conference Call and Webcast
The conference call may be accessed by dialing +1-646-968-2525 (Conference ID –1918046–) and requesting inclusion in the call for VTEX.
The live conference call can be accessed via audio webcast at the investor relations section of the Company's website, at https://www.investors.vtex.com/.
An archive of the webcast will be available for one week following the conclusion of the conference call.
Definition of Selected Operational Metrics
“ARR” means annual recurring revenue, calculated as subscription revenue in the most recent quarter multiplied by four.
“Customers” means companies ranging from small and medium-sized businesses to larger enterprises that pay to use VTEX’s platform.
“GMV” means the total value of customer orders processed through our platform, including value-added taxes and shipping. Our GMV does not include the value of orders processed by our SMB customers or B2B transactions.
“FX Neutral” or “FXN” means a way of using the average monthly exchange rates for each month during the previous year, adjusted by inflation in countries with hyper-inflation, and applying them to the corresponding months of the current year, so as to calculate what results would have been had exchange rates remained stable from one year to the next.
“Stores” or “Active Stores” means the number of unique domains generating gross merchandise value. Each customer might have multiple stores.
Special Note Regarding Non-GAAP financial metrics
For the convenience of investors, this document presents certain Non-GAAP financial measures, which are not recognized under IFRS Accounting Standards, specifically Non-GAAP subscription gross profit, Non-GAAP income (loss) from operations, free cash flow and FX Neutral measures.
We understand that Non-GAAP subscription gross profit, Non-GAAP income (loss) from operations, free cash flow and FX Neutral measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations presented in accordance with IFRS Accounting Standards. Additionally, our calculations of Non-GAAP subscription gross profit, Non-GAAP income (loss) from operations, free cash flow and FX Neutral measures may be different from the calculation used by other companies, including our competitors, and therefore, our measures may not be comparable to those of other companies.
Reconciliation of Non-GAAP measures
The following table presents a reconciliation of our Non-GAAP subscription gross profit to subscription gross profit for the following periods:
Subscription revenue
50.4
39.8
Subscription cost
(11.5)
(10.4)
Subscription gross profit
38.8
Share-based compensation
0.0
Non-GAAP subscription gross profit
Non-GAAP subscription gross margin
The following table presents a reconciliation of our Non-GAAP expenses to expenses for the following periods:
Sales & Marketing
Sales & Marketing expense
(17.2)
(14.8)
Share-based compensation expense
1.1
1.3
Amortization of intangible related to acquisitions
0.3
Non-GAAP Sales & Marketing expense
(15.8)
(13.2)
Research & Development
Research & Development expense
(12.7)
(14.0)
0.2
1.9
Non-GAAP Research & Development expense
(12.3)
(11.8)
General & Administrative
General & Administrative expense
(9.2)
(7.9)
2.6
1.7
Non-GAAP General & Administrative expense
(6.6)
(6.2)
The following table presents a reconciliation of our Non-GAAP income (loss) from operations to loss from operations for the following periods:
Loss from operations
(1.6)
(9.7)
4.1
5.1
Amortization of intangibles related to acquisitions
0.5
Non-GAAP income (loss) from operations
The following table presents a reconciliation of our free cash flow to net cash used by operating activities for the following periods:
Net cash used in operating activities
(4.9)
Acquisitions of intangibles
-
Acquisitions of property and equipment
(0.7)
(0.1)
Free cash flow
(5.0)
The following table sets forth the FX neutral measures related to our reported results of the operations for the three months ended March 31, 2024:
As Reported
FXN
As
Reported
1Q24
1Q23
Percentage
Change
26.7%
49.1
23.4%
Services revenue
2.3
2.5
(9.3)%
2.2
(10.8)%
Total revenue
24.5%
51.3
Gross profit
37.9
27.7
36.7%
36.6
32.1%
(83.6)%
(1.5)
(84.7)%
This announcement does not contain sufficient information to constitute an interim financial report as defined in International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”) IAS 34 Interim Financial Reporting, "Interim Financial Reporting" nor a financial statement as defined by IFRS Accounting Standards 1 "Presentation of Financial Statements". The financial information in this press release has not been audited.
About VTEX
VTEX (NYSE: VTEX) is the composable and complete commerce platform that delivers more efficiency and less maintenance to organizations seeking to make smarter IT investments and modernize their tech stack. Through our pragmatic composability approach, we empower brands, distributors, and retailers with unparalleled flexibility and comprehensive solutions, enabling them to invest solely in what provides a clear business advantage and boosts profitability. VTEX is trusted by 2,600 global B2C and B2B customers, including Carrefour, Colgate, Motorola, Sony, Stanley Black & Decker, and Whirlpool, having 3,500 active online stores across 43 countries (as of FY ended on December 31, 2023). For more information, visit www.vtex.com.
Forward-looking Statements
This announcement contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1993, as amended, and Section 21E of the Securities Exchange of 1934, as amended. Statements contained herein that are not clearly historical in nature, including statements about the VTEX strategies and business plans, are forward-looking, and the words “anticipate,” “believe,” “continues,” “expect,” “estimate,” “intend,” ”strategy,” “project,” “target” and similar expressions and future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may,” or similar expressions are generally intended to identify forward-looking statements.
VTEX may also make forward-looking statements in its periodic reports filed with the U.S. Securities and Exchange Commission, or the SEC, in press releases and other written materials and in oral statements made by its officers and directors. These forward-looking statements speak only as of the date they are made and are based on the VTEX’s current plans and expectations and are subject to a number of known and unknown uncertainties and risks, many of which are beyond VTEX’s control. A number of factors and risks could cause actual results to differ materially from those contained in any forward-looking statement. Further information regarding these and other risks is included in VTEX filings with the SEC.
As a consequence, current plans, anticipated actions and future financial position and results of operations may differ significantly from those expressed in any forward-looking statements in this announcement. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented as there is no guarantee that expected events, trends or results will actually occur. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information or future events or for any other reason.
This announcement may also contain estimates and other information concerning our industry that are based on industry publications, surveys and forecasts. This information involves a number of assumptions and limitations, and we have not independently verified the accuracy or completeness of the information.
VTEX
Condensed consolidated interim statements of profit or loss (Unaudited)
In thousands of U.S. dollars, unless otherwise indicated
March 31, 2024
March 31, 2023
50,362
39,762
2,286
2,520
52,648
42,282
(11,539)
(10,400)
Services cost
(3,221)
(4,166)
Total cost
(14,760)
(14,566)
37,888
27,716
Operating expenses
General and administrative
(9,172)
(7,925)
Sales and marketing
(17,192)
(14,782)
Research and development
(12,728)
(13,959)
Other losses
(386)
(754)
(1,590)
(9,704)
Financial income
9,102
7,359
Financial expense
(12,496)
(5,903)
Financial result, net
(3,394)
1,456
Equity results
18
341
Loss before income tax
(4,966)
(7,907)
Income tax
Current
(254)
(570)
Deferred
2,766
549
Total income tax
2,512
(21)
Net loss for the period
(2,454)
(7,928)
Attributable to controlling shareholders
(2,446)
Non-controlling interest
(8)
Loss per share
Basic loss per share
(0.013)
(0.042)
Diluted loss per share
Condensed consolidated interim balance sheets (Unaudited)
December 31, 2023
ASSETS
Current assets
Cash and cash equivalents
17,468
28,035
Short-term investments
191,885
181,374
Trade receivables
45,189
44,122
Recoverable taxes
5,958
6,499
Deferred commissions
1,328
1,005
Prepaid expenses
6,238
5,143
Derivative financial instruments
53
Other current assets
122
22
Total current assets
268,188
266,253
Non-current assets
Long-term investments
3,056
2,000
8,595
7,415
Deferred tax assets
22,469
19,926
127
155
4,411
4,454
3,006
2,924
Other non-current assets
788
902
Right-of-use assets
2,813
3,277
Property and equipment, net
2,969
2,697
Intangible assets, net
29,121
30,024
Investments in joint venture
1,099
1,118
Total non-current assets
78,454
74,892
Total assets
346,642
341,145
LIABILITIES
Current liabilities
Accounts payable and accrued expenses
39,352
39,728
Taxes payable
6,811
8,219
Lease liabilities
1,717
1,863
Deferred revenue
26,653
25,948
Other current liabilities
3,854
1,486
Total current liabilities
78,387
77,244
Non-current liabilities
811
1,632
1,851
2,233
19,209
16,584
Deferred tax liabilities
3,026
2,668
Other non-current liabilities
427
452
Total non-current liabilities
25,324
23,569
EQUITY
Issued capital
Capital reserve
373,554
370,821
Other reserves
1,824
(486)
Accumulated losses
(132,506)
(130,060)
Equity attributable to VTEX’s shareholders
242,890
240,293
Non-controlling interests
41
39
Total shareholders’ equity
242,931
240,332
Total liabilities and equity
Condensed consolidated interim statements of cash flows (Unaudited)
Adjustments for:
Depreciation and amortization
1,113
1,226
Deferred income tax
(2,766)
(549)
Loss on disposal of rights of use, property, equipment, and intangible assets
14
Expected credit losses from trade receivables
215
537
3,030
4,004
Provision for payroll taxes (share-based compensation)
1,092
Adjustment of hyperinflation
4,002
1,420
(18)
(341)
Accrued interest
(5,491)
(1,768)
Fair value (gains) losses
304
(3,374)
Others and foreign exchange, net
3,877
1,836
Change in operating assets and liabilities
(3,684)
(124)
(397)
(580)
(1,167)
(1,019)
Other assets
(446)
(299)
(1,346)
(4,250)
(1,038)
1,472
4,251
4,279
Other liabilities
2,888
Cash provided by (used in) operating activities
2,092
(4,688)
Income tax refund (paid)
547
(170)
Net cash provided by (used in) operating activities
2,639
(4,858)
Cash flows from investing activities
Purchase of short and long-term investment
(64,067)
(4,005)
Redemption of short-term investment
54,184
11,868
Interest and dividend received from short-term investments
197
462
(738)
(146)
(1,549)
(134)
Net cash provided by (used in) investing activities
(11,973)
8,045
Cash flows from financing activities
Changes in restricted cash
1,034
Proceeds from the exercise of stock options
448
3
Net-settlement of share-based payment
(764)
(387)
Buyback of shares
(5,330)
Payment of loans and financing
(696)
Interest paid
(4)
Principal elements of lease payments
(414)
(368)
Lease interest paid
(106)
(148)
Net cash used in financing activities
(836)
(5,896)
Net decrease in cash and cash equivalents
(10,170)
(2,709)
Cash and cash equivalents, beginning of the period
24,394
Effect of exchange rate changes
206
Cash and cash equivalents, end of the period
21,891
Non-cash transactions:
Lease liabilities arising from obtaining right-of-use assets and remeasurement
76
Transactions with non-controlling interests
10
17
View source version on businesswire.com: https://www.businesswire.com/news/home/20240507184664/en/
Julia Vater Fernández Investor Relations Director investors@vtex.com
Source: VTEX Commerce Cloud Solutions LLC