Please note this event is being recorded. I would now like to turn the conference over to Joe Crivelli, Vice President Investor Relations. Please go ahead. Hello and thanks for joining us to discuss Vertex's fourth quarter results. Chris Young, our President and CEO, and John Schwab, our CFO, are also with us today. During this call we may make forward-looking statements about expected future results. Actual results may differ due to risks and uncertainties. These risks and uncertainties are described in our filings with the Securities and Exchange Commission. Our remarks today will also include references to non-GAAP metrics. A reconciliation of these metrics to GAAP is also provided in today's press release. This call is being recorded and will be available for replay on our Investor Relations website. I'll now turn the call over to Chris. Welcome everyone and thank you for joining us. It's great to join you on my first earnings conference call as President and CEO of Vertex. Our financial results for the fourth quarter came in as expected. Revenue was $194.7 million in line with our guidance for the quarter while Adjusted EBITDA exceeded the high end of our guidance at $42.5 million. For the full year Vertex delivered double-digit revenue growth along with solid profitability. Since this is my first time speaking to our investors and analysts I wanted to cover a few topics. First why I'm excited to join Vertex at this point in the company's history. Second I'll give you a perspective from my conversations with customers partners and employees over the past three months. And third my view on how we can accelerate our revenue growth. Then I'll share some exciting new business wins from the fourth quarter. Many investors have asked what attracted me to come to Vertex, so I'll start there. First, I was drawn to Vertex's incredible blue-chip customer base, which includes over 60% of the Fortune 500. Around the world, leading enterprises trust Vertex to stay compliant with ever-changing indirect tax requirements. Our customers describe to me that Vertex is trusted, reliable, flexible, and has the deepest domain expertise in the industry. Likewise, our partner ecosystem is built on strong, long-standing relationships with the key technology and implementation partners that serve this customer base. These partners consistently recognize Vertex as the leading provider of indirect tax solutions for the enterprise. At the same time, both groups want to see us move faster and drive more innovation. And meeting that mandate will be job one for us in the near term. Second, Vertex has a long-standing track record of revenue growth, profitability, and positive cash flow across economic cycles, as well as clear growth vectors for the future. Our core expansion is steady, and our land-and-expand motion is proven. We have a new high-growth business in compliance and e-invoicing, which exceeded our expectations in its first year and has meaningful catalysts on the horizon. Third, I believe Vertex has an incredible opportunity to transform our business and help our customers transform theirs through artificial intelligence. This aligns well with my career experience, particularly my most recent role at Microsoft. There, I spent considerable time building partnerships with and, in several cases, investing in companies driving AI innovation. And I did that while working closely with many of my Microsoft teammates who were developing their own AI technologies. Turning to our near-term priorities. While our full-year growth was healthy and respectable in 2025, we saw lower entitlement growth, a moderation of new upsell and cross-sell revenue, and slightly higher customer attrition. This impacted our retention metrics, which John will discuss shortly. In looking at customer attrition, business and market factors such as M&A and bankruptcy was the single largest driver of 2025 attrition. This is largely uncontrollable by Vertex. It's also important to note that attrition continues to be concentrated in smaller accounts. The average annual revenue per customer for lost accounts in 2025 was under $50,000, far below our overall average revenue of $138,000 per customer. Finally, I'll note that competitive losses are a modest component of attrition. Vertex continues to win far more ARR from competition than we lose to our competition. That said, we are taking several actions to mitigate controllable attrition by expanding customer success coverage to a broader cohort of customers and leveraging AI tools to better serve our customers. Our AI Copilot in the product will help customers address more questions without needing to call us for help. We also have implemented analytics to predict potential customer attrition so that we can engage them more proactively, including personal phone calls from me to address their concerns. I'm also confident that our new product offerings, including e-invoicing and smart categorization, will help us accelerate cross-sell and upsell revenue in 2026. We are already seeing measurable traction with both. On a positive note, revenue from new logos remained healthy and was up 20% in 2025. This included both competitive takeaways and customers who previously used homegrown solutions and switched to Vertex. It is essential that we continue to seize this opportunity. Now let's talk more about AI. Vertex is well-positioned to help tax departments improve their workflows with artificial intelligence. Indirect tax compliance is rule-dense, it's data-heavy, and it's highly repetitive. It's the type of work that lends itself well to AI transformation. And we are starting from a fortified position as Vertex software is embedded in the workflows of our customers. In addition, our customers place a premium on tax accuracy, something they've trusted Vertex with for years. And I'll add that our revenue-based pricing model insulates us from the concerns investors have around SaaS companies with seat-based licensing models. As I shared earlier, I see significant and unique opportunity for us to capitalize on these trends. And that's one of the reasons I joined Vertex. In 2025 Vertex made significant investments in AI products, tools, and functionality. This included the launch of our Smart Categorization offering which is squarely in the wheelhouse of AI adoption. It reduces the manual work tax departments undertake every day to ensure their product SKUs are mapped to the correct tax rates across all jurisdictions. During the early adoption phase we secured several marquee six-figure wins in the retail industry. To address this growing opportunity we are broadening functionality in Smart Categorization to cover our full retail customer base. We will expand Smart Categorization to additional industries where the offering has applicability. In addition in 2025 we expanded the capabilities of Vertex Copilot. Copilot in turn helps us better understand the tasks and features customers are interacting with Copilot about providing us with insights into areas that are causing friction in the use of our solutions. This can help us enhance our products, develop new AI features, and inform future product development. Finally, we continue to leverage our partnership with Kintsugi. On last quarter's call, we highlighted Kintsugi powered by Vertex, which enables SMBs to automate key compliance functions while providing real-time dashboards for jurisdictional liability and exposure tracking. Then, in December, Kintsugi and Vertex partnered with CPA.com to launch an AI-driven solution to help accounting firms deliver automated, accurate, and scalable sales tax compliance for their clients. This then helps our partners in the accounting industry unlock new advisory revenue opportunities. While all this is a good start, we can do much more with AI, and I see a large opportunity on this front. It's my personal goal to transform Vertex into an AI-first business both in how we work internally and through the new capabilities we deliver to our customers. I will have more to share on this transformation in the near future. With that, let's review some examples of how companies are depending on Vertex to stay in compliance with indirect tax. First, wins within our installed base. It's not uncommon for enterprise customers to use Vertex in one area of the business and a competitor in another. In many cases over time these customers will reevaluate their tax software footprint and standardize on Vertex. As an example, a customer in the metals and mining industry dramatically expanded its relationship with Vertex in the fourth quarter. This customer had used Vertex's returns filing managed service for years even though it was using a competitor for tax calculation. However, during an SAP S/4HANA transformation, the company made the decision to standardize on Vertex. As a result, this is now a fulsome mid-six-figure relationship including sales and use tax calculation as well as Exemption Certificate Manager, SAP PLUS Tools, SAP Accelerator, and other Vertex offerings. In the fourth quarter, we also won in-store point-of-sale tax calculation for a global quick-service food and beverage retailer. This long-standing Vertex customer historically used us for tax calculation for its mobile app and gift card businesses but a homegrown solution at the point of sale. They switched to Vertex during a redesign of their point-of-sale system leading to high six figures of new revenue. In the Oracle ecosystem, we increased our business with a relatively new customer in the computer products manufacturing industry. Earlier this year, the customer spun out from its parent company and selected Vertex for use tax calculation. In the fourth quarter they completed the transition and added sales tax calculation leading to six figures of new annual revenue for Vertex. Turning to new logos we landed one of our largest new logos ever in Europe with a leading healthcare provider. Revenue for this new customer will be well into the seven figures. This deal was catalyzed by a global SAP S/4HANA transformation led by our partners EY and DMA. It included value-added tax calculation across the customer's global footprint as well as sales and use tax in the United States. The customer will also be using our end-to-end VAT compliance offering to file returns in 30 countries around the globe. Also in conjunction with an SAP S/4HANA transformation a major North American power utility selected Vertex as its first-ever indirect tax provider. This enterprise customer with revenue of nearly $10 billion was previously using manual solutions for use tax calculation. In addition to use tax calculation, this mid-six-figure deal, which is referred to us by our partner Accenture, also included SAP PLUS Tools, Vertex Consulting, and other ancillary products and services. This deal validates the greenfield opportunity for Vertex with large companies that are still using homegrown solutions for indirect tax. In the Oracle ecosystem, a software provider in the payment space selected Vertex to displace an entrenched competitor. We were differentiated by our ability to support the customer's massive scale and volume of transactions as well as our referenceability across the Oracle ecosystem. This led to low six figures of new revenue for Vertex. Now turning to e-invoicing. In our first full year in the business, we've seen strong traction with both existing customers and new logos accelerating demand around upcoming mandates, especially Belgium, which launched its e-invoicing mandate in January, and significant product differentiation for our end-to-end offering, which includes e-invoicing as well as VAT calculation and compliance in a single unified platform. We continue to believe our platform is unique in the marketplace and gives us a competitive advantage. Now let me give you some color on the types of e-invoicing deals we won during the fourth quarter. Wins with existing and new customers included a global payments company that selected Vertex for e-invoicing mandates in Belgium, Poland, and France. A consumer products company that selected Vertex for mandates in Germany, Belgium, and Poland. A consumer electronics company also selected Vertex for mandates in Italy, Belgium, Poland, and Denmark. Note that all of these examples are long-standing scaled customers. The e-invoicing cross-sells increased our ARR with these customers on average by over 20%. This should give investors a sense of the upsell opportunity that e-invoicing represents within the installed base. New e-invoicing logos include a 14-country win with a German building products company. E-invoicing and value-added calculation for Belgium, France, and Germany with a North American energy products company. And a deal for Belgium, Germany, France, and the U.K. and Ireland with a North American healthcare products company. All these new logos were in the mid- to high five-figure range. And while this is lower than our overall average revenue per customer, these initial engagements gave us a launching pad for our proven land and expand sales motion not just with additional e-invoicing countries but for the full suite of Vertex tax compliance solutions. So to summarize, Vertex had a solid fourth quarter. 2025 revealed some challenges, but I am confident that we have a cohesive plan to restore accelerating growth in the business. Our AI opportunity is in focus, and our first offering, smart categorization, is making a real difference for enterprise customers while driving revenue. And we have a growing opportunity in global compliance as e-invoicing mandates continue to proliferate around the globe. All in, I believe I'm joining Vertex at an extremely opportune time. With that, I'll turn the call over to John to discuss the financials in detail. John. Thanks Chris and good morning everyone. I'll now review our results in detail and provide financial guidance for the first quarter and full year of 2026. In the fourth quarter revenue was $194.7 million up 9.1% compared to last year's fourth quarter and in line with our guidance. For the full year total revenue was $748.4 million up 12.2% from 2024. In the fourth quarter our subscription revenue increased 8.9% year-over-year to $166.2 million. For the full year subscription revenue was $639.7 million up 12.8% year-over-year. I want to provide additional details and clarity around the impact of true-up revenue on our revenue growth. True-up revenue is the payment that is owed to Vertex when a customer overruns its contracted entitlements. It is recognized as revenue in quarter and the payment of a true-up typically coincides with a corresponding increase in entitlements. As a reminder we historically have realized $1 million-$2 million of true-up revenue in the first three quarters of the year and $2 million-$4 million in the fourth quarter. In the third and fourth quarter of 2024 we called out elevated true-up amounts relative to expectations. However in 2025 as we had mentioned this did not recur and renewing customers were generally within the usage limits of their contracted entitlement amounts. As a result true-up revenue in 2025 was approximately $10 million lower than 2024. This alone reduced our 2025 full year revenue growth rate by just under 2 percentage points. Lower true-up revenue in the fourth quarter reduced the year-over-year revenue growth rate by approximately 4 percentage points. And the impact on subscription revenue was approximately 2 percentage points for the year and 5 percentage points for the fourth quarter. Turning now to services revenue. Our services revenue in the fourth quarter grew 10.2% over last year's fourth quarter to $28.5 million. Full-year services revenue was $108.8 million up 9.2% year-over-year. Our cloud revenue was $94.6 million in the fourth quarter up 23% from last year's fourth quarter. Note that the decrease in quarterly cloud revenue growth was due to the lapping of the Ecosio acquisition and the elimination of the inorganic contribution to the growth rate. For the full year cloud revenue was $352.9 million up 27.9% year-over-year and generally in line with our guidance of 28% growth for the year. Annual recurring revenue or ARR was $671 million at quarter end up 11.3% year-over-year. At year end net revenue retention or NRR was 105% and gross revenue retention or GRR was 94% within our targeted range of 94%-96%. Average annual revenue per customer or AARPC was $137,867 up 12.4%. 12.4%. Our scaled customer growth in the quarter was 12%. For the remainder of the income statement discussion I will be referring to non-GAAP metrics. These non-GAAP metrics are reconciled to GAAP results in this morning's earnings press release. Our gross profit for the fourth quarter was $147.4 million and gross margin was 75.7%. This compares with gross profit of $133.9 million and a 75% gross margin in the same period last year. Our gross margin on subscription software was 82.7% compared to 81.4% in last year's fourth quarter and in the third quarter of 2025. Gross margin on services revenue was 34.9% compared to 37.6% in last year's fourth quarter and 28.8% in the third quarter of 2025. This reflects lower Ecosio margins driven by increased consulting investments to support our revenue growth. In the fourth quarter research and development expense was $19.9 million compared to $17.3 million last year. For the full year R&D was $71.3 million compared to $56.4 million last year. With capitalized software spend included R&D spend was $42.8 million for the fourth quarter and $159.8 million for the full year which represented 22% of revenue for the fourth quarter and 21.4% of revenue for the full year. The increase in R&D spending was a result of the 2025 investments in Ecosio and AI that Chris had detailed earlier. Our selling and marketing expense was $48.7 million or 25% of total revenues an increase of $5 million and approximately 11.4% from the prior year period. For the year our selling and marketing expense was $178.6 million up 15.3% from last year. The increase in selling and marketing expense in the fourth quarter was due to costs from our Vertex Exchange conference which was held in October. General and administrative expense was $36.2 million up $2 million from last year. For the full year general and administrative expense was $149.3 million compared to $128.2 million last year. Adjusted EBITDA was $42.5 million an increase of $4.4 million or 11.6% year-over-year. Full year Adjusted EBITDA was $161.5 million, representing an increase of $9.6 million or 6.3% over 2024. Both were approximately $500,000 above the high end of our guide. This represents Adjusted EBITDA margins of 21.8% for the fourth quarter and 21.6% for the full year. Our fourth quarter Free Cash Flow was $10.1 million and for the full year Free Cash Flow was $47.6 million. This was a bit lower than expected as the fourth quarter is usually our strongest Free Cash Flow quarter. While collections were lower than typical for the fourth quarter, I will note that the first week of January we realized approximately $7 million of cash collections in excess of what we'd seen in the previous years. In the fourth quarter we repurchased approximately $10 million of our shares in the open market under our stock buyback authorization at an average price of $20 per share. We have approximately $140 million remaining under our authorization. We ended the fourth quarter with over $314 million of unrestricted cash and cash equivalents and $300 million of unused availability under our line of credit. Now turning to guidance. For the full year of 2026 we expect revenues of $823.5 million-$831.5 million. Cloud revenue growth of 25% and adjusted EBITDA of $188 million-$192 million reflecting a margin of 23% at the midpoint. For the first quarter of 2026 we expect revenues of $193.5 million-$196.5 million. Adjusted EBITDA of $40.5 million-$43.5 million reflecting a margin of 21.5% at the midpoint. Chris will now make some closing comments before we open up for Q&A. Chris. Thank you, John. Before we take your questions, I want to thank all of our Vertex employees around the world for their unwavering dedication to serving our customers in 2025. Their commitment to our mission to accelerate global commerce with a global compliance platform strengthened by AI is evident in everything they do. They exemplify the strong culture that defines Vertex, and I'm truly proud to join this team and honored to be able to lead it. Earlier this year, I introduced our employees to my foundational tenets to make 2026 and beyond a success for our company and for our investors. I'll share them with you now. First, we play to win. That mindset raises our bar on product quality, customer outcomes, and how we show up for one another. We put the customer at the center of everything we do. We are constantly asking, how will what I'm doing today help a customer succeed. We earn trust through outcomes. We achieve results with speed, agility, and integrity. We'll move faster, adapt quickly, and never compromise on doing things the right way for teammates, customers, and partners. We will innovate boldly without fear. Progress demands smart risk, and we'll try new approaches, learn fast, and keep pushing the boundaries, especially where AI can remove friction and unlock value. And finally, we will communicate with candor and transparency. We'll speak plainly about what's working and what isn't, and help each other improve. That's how I've operated through my career, and that's the ethos that I'm committed to bringing to Vertex. On that foundation, I'm confident that we will continue to win in the market, accelerate growth, and capitalize on our market position as the leading provider of indirect tax solutions for the enterprise. With that, operator, please open the call for questions. Thank you. We will now begin the question and answer session. To ask a question you may press star then one on your touch-tone telephone. If you're using a speakerphone please pick up your headset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question please press star then two. Our first question comes from Andrew DeGasperi from BNP Paribas. Please go ahead. Good morning. Thanks for taking my question. Maybe, Christopher, can you? I know you've been there only a few weeks, so maybe this is a little unfair to ask, but maybe elaborate a little more in terms of what you said were the losses to competitors at the lower end of the market. Was there was this like a price-driven change or and I assume this is not AI related. Is Is that correct? That is correct. And thank you for the question. You can call me Chris no problem on here. I appreciate it. In reference to that to those remarks what I was talking about is our overall attrition. You know as you saw from some of the numbers you know attrition was higher in 2025 than we've experienced in the past. And some of the drivers of that were number one M&A and bankruptcies which we've talked about on prior earnings calls that was up this year and that was a significant factor in this. But the second one is that we saw our highest amount of churn in our smaller customers those that would have had ARR of under $50,000 per year and that compares to an average ARR per customer of $138,000 per year. So it was concentrated in smaller customers. Some of those went to competition but when we look at our head-to-head performance to competition with competition we're winning more ARR from our competitors than we're losing to competitors. That's helpful. And I guess in terms of maybe as a follow-up to John in terms of the confidence that you have in achieving the guidance for next year. I know this year you've had a lot sort of variables to play with. You know how confident are you on the growth for you know 10%-11% next year? And And what sources of upside or surprises do you think could be in store for you? Is it e-invoicing? Is it the AI product that could potentially do better? Yeah, thanks Andrew for the question. You know in terms of our guidance philosophy it hasn't changed. Again, you know we took a very thoughtful approach to setting it where we set it. We feel very good about it. And you know we took into consideration a lot of the activity and the things that we saw develop during 2025 into it as we set it. And so listen our plan is to get back to that you know beat-and-raise cadence that we've had for a number of years and we want to make sure that we took everything into consideration and set it at the right levels to do that. So we feel good about that. Listen, when I think about 2026, you know, clearly, you know, we think there is good opportunity there for activity around the e-invoicing, which is, you know, many of the mandates are coming live at the back half of the year. And so that is certainly one of the growth vectors that we see out there that we're chasing after. And I think Chris talked a little bit about SmartCat and the activity there. I mean, that's a nice product. It's got a lot. It got some traction with some very big customers, and I think that's an exciting tool out there, and it's gonna be interesting to see how that plays out over time. Thank you. Yep. The next question comes from Chris Quintero from Morgan Stanley. Please go ahead. Hey guys. Chris, it's great to meet you. My first question is for you. So you have a really interesting background and set of experiences at Microsoft, McAfee, Cisco. Curious what parallels you can draw from your time at each one of these and what you think will be particularly helpful from those experiences here as you lead Vertex. Yeah, thanks for the question, Chris. I appreciate it. And you know when I look at our company and I look at our business, there's a couple of parallels that stand out for me. The first one I'll go to my most recent. You know, obviously I spent a lot of time at Microsoft. You know, a lot of the time there was you know when a generative AI first I think really kinda started to change what we were seeing in the industry you know including what we were doing with OpenAI. And you know you could see that there was gonna be a real opportunity for companies to transform themselves using AI both what they do internally and in the technology industry what we would deliver to our customers. And so I spent actually a lot of last year really looking at you know what did I think would be the industries where there was opportunity to transform. And you know this was one category that I thought you know because of where we sit and because of the kinds of work that happens in finance and accounting departments that you know given the position we sit in we can offer them AI capabilities that would really take a lot of the task work off of their plates. And that's something that we think is a huge opportunity. It's why you know I spent some time talking about what we're doing with Smart Categorization. You could look at returns processing as another category where it's heavily manual and we believe there's opportunities like that to help our customers just automate what they do using generative AI. You know it will save them time it'll save them cost and improve their overall experience. If I kinda go back from there you know I think you know Vertex does have some similarities to what I saw in the cyber landscape. You know cyber is one of those categories that you know you constantly are refreshing your content. One of the things that makes cyber companies great is that they understand the threat landscape and it's ever-changing. And in our business the compliance landscape is ever-changing. There's constantly new tax rules there's new compliance mandates. That's what we're seeing in the e-invoicing space. We and I think one of the things that customers have told me about Vertex which gives me a lot of confidence in what we're doing and our position in the market is that they really trust our content work. They purchase from us because they see us as delivering the best content in the industry. And they recognize that it's ever-changing and that they look to Vertex to stay on top of it. You know I had one customer tell me specifically he said I'm able to run a lean tax department because I rely heavily on Vertex to deliver both the accuracy of your calculations but the updates of your content that keep us up to date on what we've gotta comply with across our different jurisdictions where we operate. That's super helpful context. And then I also wanted to ask about the net retention rates. Obviously that came down a bit and makes sense from the commentary you all gave. But curious about your expectations around where that should be on a kinda more you know medium-term normalized basis and how long you think it can take to get back there. We're obviously very focused on improving our net retention rates and you know there's a tremendous amount of effort that's going in right now to you know both introduce our newer product offerings like compliance and e-invoicing to our existing customer base. And that you know that every customer that I've talked to this is either something they are actively doing or it's certainly on their radar screen. You know whether it's U.S. customers that are doing business in other countries with those mandates or whether it's you know customers in Europe or in Latin America that obviously have those mandates in their home countries and in other countries where they're doing business. So we see that as an opportunity to grow to help our customers grow spend with us and and they're looking for us to help consolidate some of the work that they're doing in that category. We believe AI is it's it's it's earlier still than where we are with compliance and e-invoicing but we we see AI as an opportunity there. We've introduced other additional products in our our portfolio. Services we're offering around returns processing certificate Exemption Certificate Management is another category where we've you know we've brought some new product to to market just last year. So we see opportunities for growth with our customers and we're we're really trying to lean heavily into new products that we can bring to them. And then as I said on the call where we you know we're also trying to to engage customers more directly to prevent attrition. Some of that's about just understanding their needs, being proactive about that. Even to the point where as we identify customers who are at risk, I'm getting on the phone with them myself and talking to them and making sure that we understand what their needs are so we can better serve them going forward. And in some cases, I've seen some examples where we've been able to turn a situation that might have been challenged into one where we're able to do more with those customers. And that's what I'm shooting for here with our team. Excellent. The next question comes from Joshua Reilly from Needham. Please go ahead. All right. Great. Thanks for taking my questions and congrats Chris on joining the company here. As we think about the pipeline for 2026, it seems like the biggest swing factor for accelerating ARR growth is still winning those SAP ECC customers given the size of those potential deals and volume of customers. Is that how you're thinking about things as well, and how is that pipeline shaping up today? Yeah, we had a good 2025 in our SAP pipeline, and I shared with you all some of the wins that, you know, were part of that migration that customers are doing with SAP to SAP ECC to SAP S/4HANA. You know, the way I would characterize it is I think some of the expectations that were there a year ago, you know, we didn't realize it the way I think the way it was expected a year ago. But we do continue to see sort of a steady—I would say a steady—growth of these opportunities. And we're winning our, you know, same win rates, you know, on each one of these opportunities as they come up. But I think a couple things that we're seeing. One is it's taking customers longer. I think you've seen some of that in the broader markets SaaS market space. And we're also seeing that it's, you know, it's not necessarily like the timing is a little harder to predict when, you know, when the tax engine decision will happen in their overall migration process. But, you know, we're, you know, we have a very close partnership with SAP. We work very closely with their teams. We also obviously work very closely with, you know, the big, a lot of our SIs and the Big Four accounting firms that work very closely in this space. You know, they always propose us as the core enterprise solution for this, you know, because of the, you know, the work that and the value that we're able to bring to customers. And so, you know, we feel good about this pipeline. We feel good about our win rates. But, you know, I think we just want to be balanced about, you know, how we're gonna see that business flow over the course of the next couple years. Understood. What does it look like in terms of the expanding customer service or customer success to a wider group of customers in terms of do you need to hire more people? You know, can you give us a sense of what are the thresholds to get this expanded service and how quickly that's gonna be implemented? Thank you. It's actually, Josh, one of the biggest focus areas for me with AI is our customer success and customer support. I I think we can do both. Like we will add you know people in some targeted places but more importantly this is an area where we have an opportunity to make our team members more efficient so they can actually you know spend more time with customers and you know less time filling out paperwork on the back end or hunting for information, understanding you know because as you can imagine you know a you know every interaction with a customer requires them to get information and understand what's happening in the customer's environment. We believe we can. We're gonna automate all of that with AI, and that will allow our customer success team to spend more time being proactive with customers. We can help cover more accounts. And some accounts we believe we can help cover just, you know, even directly with AI. You know, there are a lot of customers who just want to get answers to the questions that they have or just want us to be able to surface ways in which they can get more value out of the product. And we're doing that through some of the AI tools that are built directly into the product itself. So this is an area where AI will play a larger and larger role for us. The goal is really to just drive more customer satisfaction and drive higher touch. That is something customers are asking for. They, you know, the reason they rely on Vertex is that we solve in many cases complex problems for them. And so at times they need us to help sort through that complexity with them. And we'll do that with great people like the ones that we have on the team today. And we'll do that by augmenting those people with AI as well as bringing AI directly to the customer. Awesome. Thank you so much guys. The next question comes from Daniel Jester from BMO Capital Markets. Please go ahead. Good morning, and thank you for taking my questions. So, Chris, maybe to sort of pull a little bit more on the AI thread. You commented in your prepared remarks about the need to innovate faster. And you know, I suspect you know I love your perspective on how you can do that. And maybe as a follow-up to that, you know, what's the philosophy around inorganic opportunities tucked in on the technology side to help along that journey? Thanks. You know, look, I think that every company can move faster in this regard. So I'll just say that at the top. And I think we have done some good work as I mentioned. You know, I like what we've done with Smart Categorization. I like the Copilot that we have in our product. But you know, I'm working with our teams, and our focus is on just speeding up everything that we're doing. Bringing AI, you know, to our product portfolio in more places. You know, for example, we have opportunities not only to help our customers with, you know, categorizing SKUs and making sure we're mapping that to appropriate tax rules but also helping our customers manage, you know, high volumes of tax content. Helping our customers with returns filing. As I mentioned, there's a series of processes that go on in and around everything that we deliver through tax calculation or determination. And this is where, you know, I believe you know we can move more quickly to deliver AI. Much of it is in our roadmap for this year. But you know as I tell our teams, you know our customers don't want it you know they want it now. They don't want it in six months from now or a year from now. So we're you know we're shifting our priority in that direction. And a lot of it is in response to helping our customers get more value from what we do. And as it relates to inorganic, you know, we'll continue to be active in the market through partnerships like the one we have with Kintsugi. And we're, you know, looking at opportunities to add capability to our portfolio. And so you'll see us, you know, be active where we think that makes sense for the business. But we are looking at all ways in which we can deliver more value to customers. All ways in which we can bring more AI innovation into the company. And we're doing it, and I just want to be clear about this. We're doing it both internal to the company itself as well as through our product portfolio. That's great perspective. Thank you Chris. And then John maybe on free cash flow and cash generation. Appreciate the comments that you made as a prepared remarks. Any other color that you would be willing to share about how we should be thinking about the trajectory of cash generation this year? Thanks so much. Yep. No thanks, Dan, for the question. Yeah, when I think about, you know, 2026 and sort of cash flow generation, again, I think, as you saw, we did make some pretty significant investments in 2025. You saw our R&D spend as a percent of revenue in the fourth quarter jump up to that 22%. Again, reflecting our need to lean into product opportunities that are out there. And so that activity was certainly relevant in the fourth quarter. But as I think about 2026, you know, I expect that we'll see continued improvement in free cash flow and conversion, because of, you know, because of some of those spend initiatives that we've talked about. They will, they will be very, very relevant in the first half of the year. They should start to tail off towards the back end and we'll see some nice pull-through from both a profitability standpoint as well as from a cash flow standpoint. Great. Thank you. You bet. The next question comes from Adam Hotchkiss from Goldman Sachs. Please go ahead. Great. Thanks so much for taking the questions. Chris, it's good to speak with you in a public forum. A bit of an offshoot to Dan's question. I think there's a lot being made of this idea that the deterministic nature of tax calc lends itself well to broader-based AI agent disintermediation. I'd love for you to just address what, in your mind, a competitor looking to do something like this would have to do to be taken seriously by an enterprise customer that you currently serve, and maybe how you're positioning the company in light of that. Thanks for the question, Adam. And yeah, I think number one, you know, as you said, the deterministic nature of tax calculation is a fortification in and of itself against AI, which is more of a probabilistic approach to the true answers that they generate. And so that's number one. And the customers would tell you—they'd tell me—you know, we have to be accurate to the penny. And so there's no room for hallucination. There's no room for approximation. You have to be accurate. So I think, look, in the fullness of time, and that could be, you know, over a long period, there's a lot that can be done. And I think that there's a lot that will change. But I see it more as an opportunity for us rather than a detriment. You know other parts of what we do that are I think very much you know in the proprietary nature of our business is all the work that we do around tax content. It's around the rules that we work with our customers to build into their determination engines. Much of that is proprietary. It's not as simple as doing a web search. And there's a tremendous amount of expertise that goes into it. It's not dissimilar for example obviously there's a lot going on out there in the market in terms of using tools to develop code. And you know there's been a lot of talk about vibe coding as an example. But the reality is vibe coding is a heck of a lot harder than it is for an experienced engineer to pick up a coding tool and get it to you know and get it to help that person become a lot more productive. And you know in this case you know our expertise in tax is something that I think we can use to leverage the power of AI. And it would take a lot longer for an inexperienced person to somehow figure out how to use that to do what we do with the kinds of expertise that we have in-house to the company. Along with that we're deeply embedded in our customers' infrastructure deeply integrated with the ERP. Those are not insignificant points of integration. You know we integrate with point of sale systems. We integrate with payroll systems, HR systems, CRM tools. So the integration points in and of themselves are also quite complex in many organizations. And so there's all that being said, I think we sit in a very strong position in the long run. Anything can happen. But I also believe that, you know, we're more well-positioned to benefit from AI and to bring AI-related capabilities to our customers than I worry about AI disintermediating us in any sort of a reasonable time frame. Okay great. That's that's really insightful. Appreciate that. And then and John when you think about the the decel from sort of the 17%-18% ARR growth you were doing in 2023-2024 to the 11% we're at now how would you sort of stack order what has contributed most to that 600-700 basis points of decel across things like entitlements cross-sell up-sell attrition market momentum in cloud ERP? Just any way you think about that breakdown and and how you plan on addressing that as we go forward would be really helpful. Thanks. Yeah, just maybe walking through the breakdown of the different components that drive it. I think we, you know, we talked a little bit about churn's been a, you know, churn's down a point or so in that time frame. Again, you've seen, you know, entitlement, you know, you've seen that's one that's one that gets to GRR. Then working through the NRR calculation. You know, NRR we've seen entitlements contributing a point and a half or so to that to that to that flow, which again we, we talked a little bit about that and talking about how that, you know, we've seen that kinda ebb and flow. And many times that's been really related to specific factors in the business. And so that is something that we do anticipate, you know, that we ought to see get back to a more normalized rate over time. And then again, there's been a little softness in the cross-sell and up-sell. You know, the migration activity that takes place. And so again, all of the different factors are contributing in there, you know. I think one of the real strong bright spots that we've seen is the new sales opportunity. New sales grew significantly in 2025. And so I think that was a very strong hot spot for us. But again there has been a little bit of push you know as we've talked about throughout the year around that additional entitlements being a big piece of that. And again some factors within our control. Some many of those factors are not in our control. And then the cross-sell upsell's been a bit softer, you know been a little bit softer over time. And I think Chris talked about the ways that we're developing new products to really address customer needs and ensuring we're taking the customer-first approach into addressing them on our product map as we move forward. Okay that's great. Thank you both. Cool. Thanks. The next question comes from Brett Huff from Stephens Inc. Please go ahead. Good morning. Thanks for the time. Chris, I'll echo the welcome. Looking forward to working with you and John and Joe. Nice to speak with you also. One more question on AI relative to the entitlements question. Some of the folks we've been talking with, given the AI disintermediation sort of, you know, hair-on-fire hysteria, wanna ask the explicit question. Have you seen any AI tech budget crowding out that might have driven the entitlement slowdown or some of the ARR slowdown you guys have seen? I know it's probably hard to define to discern that, but wanted to ask that question explicitly. We have not seen that explicitly in the activity that's going on in the field. In fact, you know, we have customers in the AI space, ourselves, that are you know doing business with us, which is a good testament to how you know they see the strength of our solution. But you know, it's hard to characterize where all the budget is going. But we have not seen that in our particular business to date as of yet. Okay, that's super helpful. And then on the invoicing, we're really excited about that opportunity and think the right to win for you all is great. But know that you were working on sort of getting to more countries as quickly as possible with the tech that you guys bought. And just knowing there's the mandates coming down the pipe so that you know people are starting to make decisions. Can you give us an update on that, you know, and are we getting to the critical mass relative to the mandate timing that we're set up to be well-positioned to win some of those deals? We are, Brett. We, we're in 39 countries now. That was a big push that the company made, you know, over the last, the back half of last year, I would say. And it's been a big push for us, you know, going into and through 2026. The Ecosio team has been executing really really well in this regard as well as has the rest of the Vertex team. You know, we've now got a combined compliance and e-invoicing offering, which you know allows us to you know to take basically connect our customers' VAT calculation with e-invoicing. 'Cause you think about this, it's an end-to-end compliance solution that our customers, the particularly the large companies, ultimately want. But on the ground, you know, we just had a mandate from Belgium, which we're in market, you know, able to serve. We'll be ready for France as it comes up, ready for Germany as it comes up. And we've, you know, been, you know, marching down the path of making sure that we've got coverage for all the major countries where we sell and where our customers are focused. Great. Those are my questions. Appreciate the time. Yeah. Thank you. The next question comes from Patrick Walravens from Citizens JMP. Please go ahead. Oh great. Thanks very much. And Chris, let me add my congratulations. We were all really excited when we saw that you were taking this role. So you know this is sort of the one time to ask this question I think. But with you know the stock's gone from $56-$15 in a year. Right? And investors just wanna understand I think what went wrong. And you coming in from the outside and having had these three months gives you a really unique perspective on it. First step to recovery's acknowledging the problem right? So you touched on a number of things. You touched on the pace of innovation, down market churn, SAP didn't come in as expected. But you know what did you figure what was the root cause? You know what was the biggest thing? If you look at Sridhar when he came into Snowflake, you know I think he determined that the product velocity just wasn't there under prior administration. But in this case what do you think the root cause was? Here's, first of all, Patrick, thanks for the question. And I definitely know that none of our investors wanna see that kind of activity. And you know, obviously my goal is to actually turn it around in the opposite direction from where it's been. There's a few things. One are some of the factors we talked about on the call. Entitlement growth did slow. We had a big entitlement year in 2024. That came back down in 2025. And that was a factor in our own growth. We did see more attrition in 2025 than we had seen in previous years. And that's, you know, I think some of that is due to the, you know, a growth in smaller customers that you know we didn't serve as well as we could, which is why we're expanding some of our focus there with our customer success teams to make sure that we're, you know, we're solving their problems and that we're proactive about, you know, making them successful. That's something that's not unique in the SaaS business for many of our, you know, many of our peers and others out there in the market landscape. And so we're taking a more proactive approach particularly around that cohort. And then I do think that there is more need for us to move faster on our product innovation as well. It's a little congruent with what I spoke about on the call, which is, you know, our customers wanna see us move more quickly. Like, as proud as I am of the work that we've done around AI, as I also mentioned, there's so much more that we could be doing. And you know, we're not at a point yet where we're generating meaningful revenue from that part of our business. And that's a place where we just gotta move more quickly and pivot our product portfolio more in that direction to give more value to our customers. And so that's a big piece of what I'm focused on. I think the opportunity—I mean, I know the opportunity is there. That's one of the reasons why I wanted to come to Vertex. But there's definitely a speed element, you know, for us that we have to improve. A lot of that is about our product, you know, delivering value from our product portfolio. It's a SAP it's a place where I'm very focused personally with our teams because I think this is something that if we can do it well, if we can move more quickly here. And you see some signs of that in terms of what we've done with e-invoicing and compliance. But even there, you know, the teams and I are pushing very hard to go faster to meet more of our customers' needs more quickly than we have in the past. All right. That's fantastic. Thank you. The next question comes from Alex Sklar from Raymond James. Please go ahead. Hi, thanks for taking the question. This is actually John Masin for Alex. Chris, I realize you talked about it quite a bit on the call here in the prepared remarks and Q&A. But I wanted to ask on AI. Have you seen customers adopt specific budgets targeted towards AI investments? And any color you can share on how you're benefiting from those budgets with smart categorization or if it's acted as a spark around your product roadmap. Just anything you can touch on there tapping into those AI budgets. You know, I'm asking—thanks, Alex, for that question. I'm asking that question in every customer conversation I have: you know, do you have a mandate? Do you have a specific budget? You know, is there something that's coming down from the CEO or the CFO, CIO where they're expecting you to do certain things? And I will tell you, the answers are kinda all over the map. Some organizations are front foot forward on this. Others aren't quite sure where they need to be. What I will say is everybody is open to getting more value. But I will say I haven't seen like there's not a cross-the-board mandate to do more with AI. However, what I am hearing from customers is that, you know, they want, you know, if they can show value with AI, they believe they're able to get budget for it. And that's something that we're gonna be leaning into a lot harder because we think that's where our opportunity exists. Okay, great. Thanks, thanks. That was helpful color there. And then I realize it's been touched on, but John, NRR has moderated some given the entitlement headwinds that you've called out and things like that. But given that dynamic and maybe the mixed macro backdrop here moving forward, can you talk about what NRR exit rate's really embedded in your outlook? And I realize it's been relatively consistent. But how should we think about pricing as a growth lever? Yeah, no, thanks for the question, John. Appreciate it. In terms of, you know, in terms of NRR, you're right. I mean, it has, we have seen that moderate a bit over the last couple of years. And when I think about sort of where the exit rate is, we do think, you know, there ought to be, we should be able to grow through our implications of the guidance that we've delivered. There should be some growth in that coming out. I would, you know, we don't expect to snap ourselves back to kinda where we started the year. But I think we do think that there is opportunity to grow that and see some nice activity and good movement over time. And you know we've tried to build what we've seen in the market in 2025 into the budget. And then with you know kind of what our FY you know what the pipelines look like and how the environment feels I think that's been built in nicely. And then in terms of pricing I think pricing you know has continued to be a big part of the algorithm. It's something that we always are very mindful of because again delivering value to our customers and having and making sure that they understand that the value that we're delivering allows us to be very front foot leaning on that you know on the pricing toggle. So that's just an area that we continue to rely on again. We'll need to continue to deliver value to make that a continued large part of the algorithm. Thank you very much. You bet. Ladies and gentlemen, this concludes the question and answer session. I would now like to turn the conference back over to Joe Crivelli for any closing remarks. Thanks everybody for joining us today. Apologies to the folks in the queue that we didn't get to. We'll certainly get to you in the follow-up calls. If anyone else has follow-up questions or would like to schedule more time with the team, please reach out to me at investors@vertexinc.com. Have a great rest of your day. We look forward to speaking with you in the coming weeks. Ladies and gentlemen, the conference is now over. Thank you for attending today's presentation. You may now disconnect your lines. Goodbye.