VTEX VTEX

GMV reached US$4.0 billion in the first quarter of 2024, representing a YoY increase of 22.2% in USD and 20.1% on an FX neutral basis.

Total revenue increased to US$52.6 million in the first quarter of 2024, from US$42.3 million in the first quarter of 2023, representing a YoY increase of 24.5% in USD and 21.3% on an FX neutral basis.

Subscription revenue represented 95.7% of total revenues and increased to US$50.4 million in the first quarter of 2024, from US$39.8 million in the first quarter of 2023, a YoY increase of 26.7% in USD and 23.4% on an FX neutral basis.

Non-GAAP subscription gross profit was US$38.9 million in the first quarter of 2024, compared to US$29.4 million in the first quarter of 2023, representing a YoY increase of 32.3% in USD and 28.5% on an FX neutral basis.

Non-GAAP subscription gross margin was 77.2% in the first quarter of 2024, compared to 73.9% in the same quarter of 2023. The YoY margin expansion of 328 bps was mainly attributable to operational hosting cost efficiencies, support cost optimization, among other impacts.

Non-GAAP income from operations was US$3.0 million during the first quarter of 2024, compared to a Non-GAAP loss from operations of US$4.1 million in the same quarter of 2023.

Non-GAAP positive free cash flow was US$1.9 million during the first quarter of 2024, compared to a Non-GAAP negative free cash flow of US$5.0 million in the same quarter of 2023.

As of March 31, 2024, our total headcount was 1,334, increasing 4.5% compared to the prior quarter and decreasing 0.4% YoY.

New customers that initiated their operations with us, among others: Keune Haircosmetics Manufacturing in Belgium, the Netherlands, and France; Arado, Cruzeiro do Sul and PetYard in Brazil; Tres Montes in Chile; OBI in Germany; PagineGialle Shop in Italy, KFC in Romania, and HMart in the US.

Existing customers expanding their operations with us by opening new online stores, among others: Grupo Soma, who added a new store in Chile, expanding its presence to more than 10 stores across Latin America and the US; Hinode Group, who added a B2B store in Brazil, now operating both B2B and B2C models across two countries in Latam; Hugo Boss, who added new stores in Colombia and Peru, increasing its footprint to four stores across Latin America; and Nike, who added, a new store in Colombia, extending its reach to three countries in Latin America.

Zero friction onboarding and collaboration:

OBI, the premier multinational home improvement retailer headquartered in Germany, has partnered with VTEX to enhance its commerce capabilities and solidify its position as a leader in home improvement. By migrating away from their previous legacy software provider, and choosing VTEX over others, OBI is now able to leverage VTEX’s renowned automation capabilities and streamlined infrastructure to simplify the buyer journey. Through VTEX’s composable commerce platform, OBI seamlessly integrated its ecommerce 349 physical stores, and third-party sellers into a unified transactional platform, expanding product offerings and providing

customers with a seamless shopping experience across various delivery and pick-up options. With integrated physical stores nationwide, customers can now pick up online orders within just two hours, showcasing the platform’s efficiency and effectiveness in meeting consumer needs. Since migrating to VTEX, OBI has experienced significant enhancements in consumer and developer experience, including unified franchise management, smooth ramp-up of platform traffic, improved front-end metrics, and increased agility in development processes.

Cloe, a leather goods brand in Mexico, partnered with VTEX for its omnichannel leadership. Leveraging VTEX’s platform, Cloe achieved cost reductions and streamlined operations, with notable features such as Personal Shopper enhancing customized experiences. This collaboration yielded impressive results, including a 14% increase in digital sales in 2023, alongside strengthened offline sales. With a notable 60.5% increase in conversion rates and a 12.5% growth in average order value.

Colgate’s partnership with VTEX exemplifies digital commerce innovation. Leveraging VTEX’s marketplace functionality, Colgate swiftly established a B2B ecommerce platform, streamlining implementation and reducing costs. This unique marketplace, designed exclusively for dentists, integrates distributor products seamlessly, fostering sales growth without logistical overhead with strategic enhancements, including cashback promotions and a loyalty program. Colgate started their operations with VTEX in Brazil, and in the 4Q23 they added two B2B sites in the US, PCA Skin and Colgate Professional, leveraging our fully composable architecture.

Mezzo, a leading Brazilian dermo-cosmetics chain across nine states, partnered with VTEX to develop their B2C and B2B platforms. Launching two stores, Mezzo Cosmetics and Mezzo Professionals, they achieved seamless connectivity with physical stores and unified data sources for streamlined operations. Each franchisee account serves as a white-label seller, representing individual stores and ensuring optimal inventory management. Remarkably, the project was completed in just three months.

Enhanced marketplace features streamline requirement group management for Received SKUs, reducing operational burdens and accelerating time-to-revenue for platform sellers.

Single control panel for every order:

Dimak, a leading grocery distributor in Chile, partnered with VTEX to modernize their B2B operations. With VTEX’s innovative solutions, Dimak established a 24/7 online store and implemented a closed website model, resulting in significant growth. Dimak saw a 10x increase in GMV and orders, doubled conversion rates, and achieved a 4 p.p. boost in profitability compared to traditional channels.

Interfood, a leading Brazilian beverage importer with global presence, has been a satisfied VTEX B2C customer since 2020. Recently, they extended their partnership with VTEX to power their B2B operations, unlocking new opportunities. Leveraging VTEX’s B2B Suite tool, Interfood seamlessly integrated APIs to streamline customer registrations and credit control processes. With VTEX IO Apps, tax requirements were tailored to meet Interfood’s precise needs, showcasing VTEX’s commitment to exceeding customer expectations.

KFC, a quick service restaurant giant, selected VTEX in Romania to power their B2C operations. Seamlessly aligning with VTEX’s out-of-the-box functionalities, KFC swiftly launched their website and mobile app, for both IOS and Android, all from a single code base. The VTEX team was able to adeptly tailor ordering and payment methods to meet KFC’s specific requirements and be ready to launch the project in only four months.

Launched VTEX Shield, empowering enterprise brands to monitor, safeguard against security threats, and preserve revenue while ensuring the security of sensitive data to uphold customer trust. Our solution adds an extra layer to enhance data protection measures.

Launched VTEX WhatsApp Campaigns, unlocking personalized sales conversions with a plug-and-play WhatsApp Business Account creator in VTEX Admin, connected to Meta. Brands can now activate targeted campaigns for timely engagement and higher conversion rates. Real-time analytics track campaign effectiveness, monitoring conversions with view-to-conversion metrics.

Commerce on auto-pilot and co-pilot:

New Balance, the renowned global sneaker brand, doubled website conversion rates after migrating to VTEX in Brazil. Previously, they faced limitations on their old platform, unable to deliver innovative experiences due to high development costs. VTEX’s composable platform and plug-and-play functionalities addressed these challenges, enabling seamless integration of pricing catalogs and XML automation. With VTEX’s API integrations, manual tasks became automated, empowering teams to manage promotions independently. The migration led to rapid results, including increased product page visits, doubled conversions, and revenue growth within a month post-migration.

Launched VTEX Ad Network, connecting customers with ideal advertising partners through our vast network. Using AI-driven targeting and auctions, we optimize ad campaigns to maximize revenue. Our focus is to streamline operations, scale AI and analytics for insights, and advance security measures for data protection.

Launched VTEX Data Pipeline, empowering enterprises with enhanced data connections to effectively leverage AI. Our solution offers specialized APIs for bulk data retrieval and secure data-sharing services, seamlessly delivering VTEX commerce data to customers’ preferred data warehouses.

Launched VTEX Delivery Promise, showcasing delivery options and dates directly within search filters and product pages using advanced algorithms and technology. Addressing shopper expectations for tailored experiences based on desired delivery methods or dates.

Enhanced existing products with AI features, including: VTEX Intelligent Search, optimizing results and boosting conversions; Live Shopping, enhancing engagement with AI Chat; Pick and Pack, streamlining operations, reducing errors, and improving efficiency; Shipping Insights, offering real-time visibility for optimized logistics and prompt delivery. Through strategic AI application, VTEX equips customers to stay competitive by delivering faster time to market, lower costs, and increased GMV.

The development platform of choice for digital commerce:

Hearst, the leading global, diversified media, information, and services company, chose VTEX for its extensive native capabilities, adaptable multi-site architecture, and VTEX IO development platform, enabling the integration of custom features. Leveraging VTEX, Hearst established a marketplace supporting multi-vendor business models, thereby seamlessly enhancing the customer experience across its publications and shoppable interfaces, facilitating the easy purchase of featured products. With VTEX’s out-of-the-box features and flexible APIs, Hearst swiftly launched its platform and iteratively leveraged new business models in the digital economy. This transition led to a significant reduction in Total Cost of Ownership, from high-single-digits to low-single-digits, highlighting the efficiency and adaptability of VTEX’s solution. Furthermore, Hearst serves as the flagship client piloting VTEX Data Pipeline and VTEX Fast Checkout, currently undergoing A/B testing on their Men’s Health website, as the primary checkout experience.

Launched VTEX FastStore, revolutionizing store creation and evolution with unparalleled performance and adaptability. Consisting of three core products: FastStore Framework, offering a suite of commerce-optimized UI components, code libraries, and integrations; FastStore WebOps, a comprehensive front-end

platform with performance metrics, automated checks, and a robust serving layer powered by a global edge network; and Headless CMS, a powerful yet user-friendly content management system empowering content teams to manage updates independently.

Launched VTEX FastCheckout, utilizing elements of FastStore, the product offers multiple features aimed at reducing cart abandonment rates and improving overall conversion, seamlessly integrating with VTEX Headless CMS.

(in millions of US$, except as otherwise indicated)

GMV

GMV growth YoY FXN (1)

Revenue

Revenue growth YoY FXN (1)

Non-GAAP subscription gross profit (2)(4)

Non-GAAP subscription gross profit margin ⁽³⁾⁽⁴⁾

Non-GAAP income (loss) from operations ⁽⁴⁾

Total number of employees

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.

Corresponds to our subscription revenues minus our subscription costs.

Corresponds to our subscription gross profit divided by subscription revenues.

Reconciliation of Non-GAAP metrics can be found in tables below.

(in millions of US$, except as otherwise indicated)

Subscription revenue

Subscription cost

Subscription gross profit

Share-based compensation

Non-GAAP subscription gross profit

Non-GAAP subscription gross margin

Sales & Marketing

(in millions of US$, except as otherwise indicated)

Sales & Marketing expense

Share-based compensation expense

Amortization of intangible related to acquisitions

Non-GAAP Sales & Marketing expense

Research & Development

(in millions of US$, except as otherwise indicated)

Research & Development expense

Share-based compensation expense

Amortization of intangible related to acquisitions

Non-GAAP Research & Development expense

General & Administrative

(in millions of US$, except as otherwise indicated)

General & Administrative expense

Share-based compensation expense

Amortization of intangible related to acquisitions

Non-GAAP General & Administrative expense

(in millions of US$, except as otherwise indicated)

Loss from operations

Share-based compensation expense

Amortization of intangibles related to acquisitions

Non-GAAP income (loss) from operations

(in millions of US$, except as otherwise indicated)

Net cash used in operating activities

Acquisitions of intangibles

Acquisitions of property and equipment

Free cash flow

(in millions of US$, except as otherwise indicated)

Subscription revenue

Services revenue

Total revenue

Gross profit

Loss from operations

Subscription revenue

Services revenue

Total revenue

Subscription cost

Services cost

Total cost

Gross profit

Operating expenses

General and administrative

Sales and marketing

Research and development

Other losses

Loss from operations

Financial income

Financial expense

Financial result, net

Equity results

Loss before income tax

Income tax

Current

Deferred

Total income tax

Net loss for the period

Attributable to controlling shareholders

Non-controlling interest

Loss per share

Basic loss per share

Diluted loss per share

ASSETS

Current assets

Cash and cash equivalents

Short-term investments

Trade receivables

Recoverable taxes

Deferred commissions

Prepaid expenses

Derivative financial instruments

Other current assets

Total current assets

Non-current assets

Long-term investments

Trade receivables

Deferred tax assets

Prepaid expenses

Recoverable taxes

Deferred commissions

Other non-current assets

Right-of-use assets

Property and equipment, net

Intangible assets, net

Investments in joint venture

Total non-current assets

Total assets

LIABILITIES

Current liabilities

Accounts payable and accrued expenses

Taxes payable

Lease liabilities

Deferred revenue

Other current liabilities

Total current liabilities

Non-current liabilities

Accounts payable and accrued expenses

Lease liabilities

Deferred revenue

Deferred tax liabilities

Other non-current liabilities

Total non-current liabilities

EQUITY

Issued capital

Capital reserve

Other reserves

Accumulated losses

Equity attributable to VTEX’s shareholders

Non-controlling interests

Total shareholders’ equity

Total liabilities and equity

Net loss for the period

Adjustments for:

Depreciation and amortization

Deferred income tax

Loss on disposal of rights of use, property, equipment, and intangible assets

Expected credit losses from trade receivables

Share-based compensation

Provision for payroll taxes (share-based compensation)

Adjustment of hyperinflation

Equity results

Accrued interest

Fair value (gains) losses

Others and foreign exchange, net

Change in operating assets and liabilities

Trade receivables

Recoverable taxes

Prepaid expenses

Other assets

Accounts payable and accrued expenses

Taxes payable

Deferred revenue

Other liabilities

Cash provided by (used in) operating activities

Income tax refund (paid)

Net cash provided by (used in) operating activities

Cash flows from investing activities

Purchase of short and long-term investment

Redemption of short-term investment

Interest and dividend received from short-term investments

Acquisitions of property and equipment

Derivative financial instruments

Net cash provided by (used in) investing activities

Cash flows from financing activities

Changes in restricted cash

Proceeds from the exercise of stock options

Net-settlement of share-based payment

Buyback of shares

Payment of loans and financing

Interest paid

Principal elements of lease payments

Lease interest paid

Net cash used in financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents, beginning of the period

Effect of exchange rate changes

Cash and cash equivalents, end of the period

Non-cash transactions:

Lease liabilities arising from obtaining right-of-use assets and remeasurement

Transactions with non-controlling interests