Track market-moving stories before they get noisy

Key Takeaways Vertex Pharmaceuticals' stock gained 15.4% in a month after strong results and higher 2026 guidance.Alyftrek is boosting CF sales, while Journavx and Casgevy are gaining traction as non-CF products.Povetacicept and other renal candidates could diversify revenues, with potential approvals in 2026 and 2027. Vertex Pharmaceuticals Incorporated (VRTX - Free Report) stock has risen 15.4% in a month, driven mainly by strong second-quarter results, higher 2026 guidance, growing confidence in its post-cystic fibrosis (CF) growth story and renewed optimism around its renal pipeline.

Vertex reported second-quarter revenues of $3.33 billion, up 12% year over year, and raised its full-year revenue outlook to $13.1-$13.2 billion from $12.95-$13.1 billion previously. Earnings of $4.73 per share rose around 5% year over year.

Let's take a closer look at these factors to assess the key drivers behind VRTX's recent rally and determine how investors should approach the stock after its strong price gain.

Consistent Rise in VRTX’s CF Product SalesVertex holds a leadership position in the CF market. With its five CF medicines, Vertex can treat nearly 95% of all people living with CF in core markets. Demand for its CF therapies continues to grow, as the company expands access globally and wins approvals in younger patient populations. Meanwhile, Vertex does not face any near-term headwinds from LOE or increased competition for its CF therapies.

Its CF products generated revenues of $6.1 billion in the first half of 2026, up 8.4% year over year, driven by Trikafta/Kaftrio as well as increasing contribution from Alyftrek, a next-in-class triple combination regimen and Vertex’s fifth and newest CF medicine.

Alyftrek continues to outperform expectations and generated sales worth $573.6 million in the second quarter, up 35% on a sequential basis. The rollout of Alyftrek in the United States and Europe is progressing well across all patient groups. The drug surpassed $1 billion in cumulative global revenues in the first half of 2026. Alyftrek’s once-daily dosing and improved sweat chloride profile continue to resonate with patients and doctors.

Vertex is also conducting studies to expand the labels of Alyftrek and Trikafta to additional mutations as well as to younger patients. Vertex recently began global regulatory filings for Alyftrek in children with cystic fibrosis aged 2 to 5 years. 

Vertex expects incremental patients from the label expansions for Alyftrek and Trikafta, along with launches of Alyftrek in additional geographies and for treating younger patients, to drive CF growth through the rest of the year.

VRTX’s New Non-CF Drugs Show Strong Growth PotentialThe uptake of Vertex’s newly launched non-CF products, Journavx and Casgevy, was slower than expected in 2025. However, their sales are gradually picking up in 2026.

Journavx, a novel non-opioid pain medicine (suzetrigine), approved last year, has drawn significant investor attention because of the large unmet need for safer pain therapies amid the opioid crisis. Though Journavx’s sales have been slow since launch, its launch metrics and early reimbursement progress look positive. Vertex expects both sales and prescriptions to more than triple in 2026 versus 2025, reflecting the drug’s expanding market access and growing adoption. Journavx generated $49.6 million in sales in the second quarter, up 71% on a sequential basis, backed by strong underlying prescription growth.

Vertex and partner CRISPR Therapeutics’ (CRSP - Free Report) one-shot gene therapy, Casgevy, was approved for two blood disorders, sickle cell disease (SCD) and transfusion-dependent beta-thalassemia (TDT), in multiple regions in late 2023/early 2024. Vertex leads the global development and commercialization of Casgevy under the terms of the 2021 agreement with support from CRISPR Therapeutics.

Casgevy’s sales were $76.4 million in the second quarter, up 78% on a sequential basis and 151% on a year-over-year basis due to an increase in patient infusions. Casgevy recorded more than 100 patient initiations in the second quarter as the launch continues to progress. First-half 2026 infusions have already exceeded the total for 2025, supported by improved reimbursement and growing patient uptake across key markets. Vertex is also making rapid progress in the drug’s access and reimbursement. In July, the FDA approved Casgevy for expanded use in pediatric patients 2 years and older with TDT and SCD.

The company expects non-CF products to generate revenues of $500 million plus in 2026, representing year-over-year growth of around 185%, driven by growing Casgevy infusions and a meaningful ramp in Journavx prescriptions and revenues.

Vertex’s Expanding Renal Pipeline Could Diversify GrowthWhile Vertex’s main focus is on the development and strengthening of its CF franchise, the company also has a rapidly advancing mid - to late-stage pipeline in other disease areas beyond CF, like acute and neuropathic pain, APOL1-mediated kidney disease (AMKD), IgA nephropathy (IgAN), primary membranous nephropathy (pMN) and autosomal dominant polycystic kidney disease (ADPKD).

Many of these candidates represent multibillion-dollar opportunities. Many of these programs are in pivotal development, setting the stage for several potential regulatory filings in 2026 and early 2027, and potential new drug approvals in a couple of years.

Vertex’s candidates for kidney diseases are capturing investor attention. In kidney diseases, key pipeline candidates are VX-407 for ADPKD, inaxaplin for AMKD and povetacicept for IgAN and pMN. It is believed that povetacicept and inaxaplin represent significant commercial opportunities.

Povetacicept was added to Vertex’s portfolio from the Alpine acquisition in 2024. Vertex believes povetacicept has pipeline-in-a-product potential for B-cell-mediated diseases. Povetacicept is designed to target two proteins, namely BAFF and APRIL, which are jointly responsible for the cause of multiple serious autoimmune diseases.  In June 2026, the FDA accepted the regulatory filing seeking approval for povetacicept for IgAN. A final decision from the FDA is expected on Nov. 30, 2026. If approved, povetacicept would become Vertex's first commercialized nephrology product. Positive commercial progress of a competitor, Otsuka's IgAN therapy Voyxact, launched in 2025, has increased investor confidence in the IgAN market’s commercial opportunities.

Vertex is also conducting a pivotal phase II/III study of povetacicept for a second potential renal indication, pMN. Vertex is also conducting a phase II study on povetacicept for the treatment of gMG.

Vertex expects its kidney portfolio to become a significant growth driver over the next several years and diversify the company’s revenue streams.

However, Vertex has faced regular pipeline setbacks. In 2026, Vertex ended the phase I/II clinical study on mRNA therapeutic VX-522 in CF, after observing persistent tolerability issues in the study. Vertex was developing VX-522 in partnership with Moderna (MRNA - Free Report) .

VRTX’s Price, Valuation and EstimatesVertex stock has risen 22.0% so far this year, outperforming the industry’s 17.9% growth. 

VRTX Stock Outperforms IndustryImage Source: Zacks Investment Research

From a valuation standpoint, Vertex is slightly expensive. Going by the price/earnings ratio, the company’s shares currently trade at 27.52 forward earnings, higher than 19.44 for the industry. The stock is also trading above its five-year mean of 25.23.

VRTX Stock ValuationImage Source: Zacks Investment Research

The Zacks Consensus Estimate for 2026 earnings has declined from $19.17 per share to $19.01 over the past 30 days, while that for 2027 has deteriorated from $20.97 per share to $20.66 per share over the same time frame.

VRTX Estimate MovementImage Source: Zacks Investment Research

Stay Invested in VRTX StockThe company has its share of headwinds like heavy dependence on the CF franchise, regular pipeline setbacks, intensifying competition as well as the risky nature of its non-CF pipeline programs.

However, Vertex dominates the CF market with drugs like Trikafta/Alyftrek and boasts a breakthrough non-CF pipeline. Vertex’s investment case has strengthened materially because the company is gradually transitioning from being predominantly a CF story toward a multi-pillar growth company.

In July 2026, Vertex agreed to acquire Crinetics Pharmaceuticals for about $10 billion, gaining Palsonify, its once-daily oral treatment for acromegaly. The acquisition will further diversify Vertex’s portfolio, adding rare endocrine diseases, which have high unmet need, as its fifth pillar. Vertex believes that Crinetics’ two lead assets, Palsonify and lead pipeline candidate atumelnant, together represent a peak sales opportunity of about $5 billion.

We believe Vertex is a good stock to have in one’s portfolio, considering its strong overall financial performance and robust pipeline progress. Vertex faces minimal competition in the CF franchise, which gives it pricing power. Vertex expects that both Casgevy and Journavx can become multibillion-dollar products in the long term. Long-term investors may retain this Zacks Rank #3 (Hold) stock for now. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The past couple of years have been volatile for Vertex Pharmaceuticals (VRTX -2.07%). Between clinical setbacks and worse-than-expected financial results, the company has sometimes disappointed investors. However, Vertex has always bounced back, and it recently hit a new all-time high, though it has since receded from that. Even so, the future is bright for the drugmaker. Here is why there is plenty more upside ahead.

Image source: The Motley Fool.

The core business is still strong
Vertex Pharmaceuticals is best known for developing medicines that treat cystic fibrosis (CF), an area where it has no meaningful competition. Some investors worry that this might change soon, as several drugmakers are looking to launch competing CF medicines. Sionna Therapeutics, a much smaller biotech company, has an entire pipeline dedicated to that. Other companies are also on this trail, including Krystal Biotech.

However, for now, Vertex continues to dominate this field and generate significant revenue and earnings. In the second quarter, the company's sales came in at $3.33 billion, up 12% year over year. Vertex's earnings per share were $4.31, about 8% higher than the year-ago period. Potential competition in the CF area poses a significant risk to the company, given that CF revenue totaled $3.2 billion during the period. But it's not the first time that Vertex has faced this risk. Many previous attempts to challenge the company in CF have failed.

Several years ago, AbbVie (ABBV -0.54%), a pharmaceutical giant, gave up on challenging Vertex Pharmaceuticals after its leading CF programs flopped in clinical trials.

We can now add one of Sionna's leading candidates, which recently failed a mid-stage study, to that list. Meanwhile, Vertex has launched new medicines outside its core area in recent years. The company expects $500 million in non-CF revenue in 2026 -- that's not that significant, but Vertex's non-CF business should start ramping up. Vertex's Casgevy, a gene editing medicine for a pair of rare blood-related conditions, recently earned a label expansion and is now indicated to treat children as young as two. Journavx, the company's non-opioid treatment for acute pain, could also earn label expansions.

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Vertex's diversification efforts
Vertex Pharmaceuticals is racing toward the approval of povetacicept, an investigational medicine for IgA nephropathy, a kidney disease. The medicine completed a phase 3 study earlier this year and could get the nod from U.S. regulators by the end of November. Povetacicept may earn label expansions beyond that, too. The therapy could, eventually, meaningfully contribute to Vertex's financial results. Analysts estimate that it will generate well over $1 billion in annual sales at its peak.

Vertex has other promising pipeline candidates, including inaxaplin, which it is developing for APOL1-mediated kidney disease. Furthermore, the company has recently expanded its pipeline. Last month, Vertex Pharmaceuticals announced the acquisition of Crinetics Pharmaceuticals (CRNX +0.31%), a smaller biotech, for about $10 billion in cash. Crinetics' portfolio includes Palsonify, a medicine for acromegaly, a rare hormonal disease that can cause bones to get bigger, and may be life-threatening.

Crinetics also has promising pipeline candidates across other hormonal conditions. Vertex estimates that Crinetics' entire portfolio could generate $5 billion in peak sales. It may not be quite that successful, but Vertex Pharmaceuticals is casting a broad net, with multiple candidates across several therapeutic areas and clinical trial phases. The company's diversification efforts should eventually succeed, allowing it to mitigate the risk posed by another drugmaker's potential launch of CF medicines. So, the stock hasn't peaked yet.

Vertex could deliver solid returns over the next five years and beyond as its financial results improve, driven by new launches in CF and elsewhere. Investors should stick with the stock.

KING OF PRUSSIA, Pa., Aug. 03, 2026 (GLOBE NEWSWIRE) -- Vertex, Inc. (NASDAQ: VERX) (“Vertex” or the “Company”), the Decision-to-Defense™ global indirect tax and compliance company, today announced financial results for its second quarter ended June 30, 2026.

“Vertex delivered solid second-quarter results, with revenue at the high end of our guidance and adjusted EBITDA exceeding our expectations,” said Christopher Young, President and Chief Executive Officer. “The quarter demonstrated the durability of our business and the earnings leverage we can generate through greater operating focus and discipline. Customer retention remained stable, and e-invoicing momentum improved as enterprises prepare for expanding global mandates and seek more comprehensive compliance solutions.”

“We are making tangible progress in the transformation of Vertex. Our “AI-First” strategy is beginning to improve the speed and efficiency of selected engineering and customer-delivery workflows, and we have strengthened our leadership team to accelerate product innovation, operational execution, and growth. While we have more work to do, we enter the second half with a stronger operating foundation and clear opportunities to create additional value for customers and stockholders.”

Second Quarter 2026 Financial Results

Total revenues of $204.0 million, up 10.5% year-over-year.Software subscription revenues of $174.8 million, up 10.7% year-over-year.Cloud revenues of $101.7 million, up 17.9% year-over-year.Annual Recurring Revenue (“ARR”) was $703.4 million, up 10.5% year-over-year.Average Annual Revenue per direct customer (“AARPC”) was $142,997 at June 30, 2026, compared to $130,934 at June 30, 2025, and $140,464 at March 31, 2026.Net Revenue Retention (“NRR”) was 105%, compared to 108% at June 30, 2025, and 105% at March 31, 2026.Gross Revenue Retention (“GRR”) was 95%, consistent with June 30, 2025 and March 31, 2026.Loss from operations of $4.4 million, compared to $3.9 million for the same period in the prior year.Non-GAAP operating income of $44.3 million, compared to $32.2 million for the same period in the prior year.Net income (loss) of $9.0 million, compared to $(1.0) million for the same period in the prior year.Net income per basic and diluted Class A and Class B shares of $0.06, compared to net loss per basic and diluted Class A and Class B shares of $0.01 for the same period in the prior year.Non-GAAP net income of $33.3 million and Non-GAAP diluted earnings per share (“EPS”) of $0.20.Adjusted EBITDA of $51.0 million, compared to $38.4 million for the same period in the prior year. Adjusted EBITDA margin of 25.0%, compared to 20.8% for the same period in the prior year. Definitions of certain key business metrics and the non-GAAP financial measures used in this press release and reconciliations of such measures to the most directly comparable GAAP financial measures are included below under the headings “Definitions of Certain Key Business Metrics” and “Use and Reconciliation of Non-GAAP Financial Measures.”

Financial Outlook

For the third quarter of 2026, the Company currently expects:

Revenues of $208.0 million to $211.0 million; andAdjusted EBITDA of $55.0 million to $57.0 million. For the full-year 2026, the Company currently expects:

Revenues of $825.0 million to $830.0 million;
Cloud revenue growth of 18%; and 
Adjusted EBITDA of $206.0 million to $210.0 million. John Schwab, Chief Financial Officer added, “Our second quarter performance reflects solid execution against our strategic and financial objectives. The consistency of our first-half results and the strength of our operating model increased our confidence in the full year, allowing us to narrow our revenue guidance range while raising our adjusted EBITDA outlook. We continue to focus on balancing growth investments with operating discipline, which we expect to result in expanding profitability and stronger cash generation in the third and fourth quarters.”

The Company is unable to reconcile forward-looking Adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure, without unreasonable efforts because the Company is currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact net income (loss) for these periods but would not impact Adjusted EBITDA. Such items may include stock-based compensation expense, depreciation and amortization of capitalized software costs and acquired intangible assets, severance expense, acquisition contingent consideration, changes in the fair value of acquisition contingent earn-outs, amortization of cloud computing implementation costs, severance expenses, acquisition-related retained employee compensation, transaction costs, and other items. The unavailable information could have a significant impact on the Company’s net income (loss). The foregoing forward-looking statements reflect the Company’s expectations as of today’s date. Given the number of risk factors, uncertainties and assumptions discussed below, actual results may differ materially. The Company does not intend to update its financial outlook until its next quarterly results announcement.

Important disclosures in this earnings release about and reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are provided below under “Use and Reconciliation of Non-GAAP Financial Measures.”

Conference Call and Webcast Information

Vertex will host a conference call at 5:00 p.m. Eastern Time today, Monday, August 3, 2026, to discuss its second quarter 2026 financial results.

Those wishing to participate should register in advance for the live event at https://vertex-earnings-q2-2026.open-exchange.net/registration.

A live webcast of the event will also be available at the Company’s investor relations website at https://ir.vertexinc.com. An audio-only replay of the conference call will be available on the investor relations website for one year.

About Vertex

Vertex is the Decision-to-Defense™ global indirect tax and compliance company. Vertex helps enterprises bring control to indirect tax and compliance across the full transaction lifecycle — from tax determination and e-invoicing through reporting, filing, and audit defense — to make outcomes easier to prove and improve over time. Trusted by more than 60% of the Fortune 500, Vertex combines decades of tax expertise, deep global tax and compliance knowledge, and embedded integrations to help organizations operate globally with confidence. With headquarters in North America and offices in South America and Europe, Vertex's purpose is to ensure businesses and communities thrive through trusted transactions. 

For more information, visit www.vertexinc.com or follow us on X and LinkedIn.

Forward-Looking Statements

Any statements made in this press release that are not statements of historical fact, including statements about our beliefs and expectations, are forward-looking statements and should be evaluated as such. Forward-looking statements include information concerning possible or assumed future results of operations, including descriptions of our business plan and strategies, and our stock repurchase program. Forward-looking statements are based on Vertex management’s beliefs, as well as assumptions made by, and information currently available to, them. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. Factors which may cause actual results to differ materially from current expectations include, but are not limited to: our ability to maintain and grow revenue from existing customers and new customers, and expand their usage of our solutions; our ability to maintain and expand our strategic relationships with third parties; our ability to adapt to technological change and successfully introduce new solutions or provide updates to existing solutions; risks related to failures in information technology or infrastructure; risks related to our reliance on government infrastructure to support our e-invoicing services; challenges in using and managing use of Artificial Intelligence in our business; incorrect or improper implementation, integration or use of our solutions; failure to attract and retain qualified technical and tax-content personnel; competitive pressures from other tax software and service providers and challenges of convincing businesses using native enterprise resource planning functions to switch to our software; our ability to accurately forecast our revenue and other future results of operations based on recent success; our ability to offer specific software deployment methods based on changes to customers’ and partners’ software systems; our ability to continue making significant investments in software development and equipment; our ability to sustain and expand revenues, maintain profitability, and to effectively manage our anticipated growth; our ability to successfully diversify our solutions by developing or introducing new solutions or acquiring and integrating additional businesses, products, services, or content; our ability to successfully integrate acquired businesses and to realize the anticipated benefits of such acquisitions; risks related to the fluctuations in our results of operations; risks related to our expanding international operations; our exposure to liability from errors, delays, fraud or system failures, which may not be covered by insurance; our ability to adapt to organizational changes and effectively implement strategic initiatives; risks related to our determinations of customers’ transaction tax and tax payments; risks related to changes in tax laws and regulations or their interpretation or enforcement; our ability to manage cybersecurity and data privacy risks; our involvement in material legal proceedings and audits; risks related to undetected errors, bugs or defects in our software; risks related to utilization of open-source software, business processes and information systems; our ability to effectively protect, maintain, and enhance our brand; changes in application, scope, interpretation or enforcement of laws and regulations; global economic weakness and uncertainties, including the economic uncertainty created by the changing legal, regulatory, or taxation landscape in the United States, and disruption in the capital and credit markets; business disruptions related to natural disasters, epidemic outbreaks, including a global endemic or pandemic, terrorist acts, political events, or other events outside of our control; our ability to comply with anti-corruption, anti-bribery, and similar laws; our ability to protect our intellectual property; changes in interest rates, security ratings and market perceptions of the industry in which we operate, or our ability to obtain capital on commercially reasonable terms or at all; our ability to maintain an effective system of disclosure controls and internal control over financial reporting, or ability to remediate any material weakness in our internal controls; risks related to our Class A common stock and controlled company status; risks related to our stock repurchase program; risks related to our indebtedness and adherence to the covenants under our debt instruments; our expectations regarding the effects of the Capped Call Transactions (as defined in our Form 10-K) and regarding actions of the Option Counterparties (as defined in our Form 10-K) and/or their respective affiliates; risks associated with our Value Creation Plan; and the other factors described under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (“Form 10-K”), filed with the Securities and Exchange Commission (the “SEC”) on February 24, 2026, as may be subsequently updated by our other SEC filings. Copies of such filings may be obtained from the Company or the SEC.

All forward-looking statements reflect our beliefs and assumptions only as of the date of this press release. We undertake no obligation to update forward-looking statements to reflect future events or circumstances.

Definitions of Certain Key Business Metrics

Annual Recurring Revenue (“ARR”)

We derive the vast majority of our revenues from recurring software subscriptions. We believe ARR provides us with visibility to our projected software subscription revenues in order to evaluate the health of our business. Because we recognize subscription revenues ratably, we believe investors can use ARR to measure our expansion of existing customer revenues, new customer activity, and as an indicator of future software subscription revenues. ARR is based on monthly recurring revenues (“MRR”) from software subscriptions for the most recent month at period end, multiplied by twelve. MRR is calculated by dividing the software subscription price, inclusive of discounts, by the number of subscription covered months. MRR only includes direct customers with MRR at the end of the last month of the measurement period. AARPC represents average annual revenue per direct customer and is calculated by dividing ARR by the number of software subscription direct customers at the end of the respective period.

Net Revenue Retention (“NRR”)

We believe that our NRR provides insight into our ability to retain and grow revenues from our direct customers, as well as their potential long-term value to us. We also believe it demonstrates to investors our ability to expand existing customer revenues, which is one of our key growth strategies. Our NRR refers to the ARR expansion during the 12 months of a reporting period for all direct customers who were part of our customer base at the beginning of the reporting period. Our NRR calculation takes into account any revenues lost from departing direct customers or those who have downgraded or reduced usage, as well as any revenue expansion from migrations, new licenses for additional products or contractual and usage-based price changes.

Gross Revenue Retention (“GRR”)

We believe our GRR provides insight into and demonstrates to investors our ability to retain revenues from our existing direct customers. Our GRR refers to how much of our MRR we retain each month after reduction for the effects of revenues lost from departing direct customers or those who have downgraded or reduced usage. GRR does not take into account revenue expansion from migrations, new licenses for additional products or contractual and usage-based price changes. GRR does not include revenue reductions resulting from cancellations of customer subscriptions that are replaced by new subscriptions associated with customer migrations to a newer version of the related software solution. 

Customer Count

The following table shows Vertex’s direct customers, as well as indirect small business customers sold and serviced through the Company’s one-to-many channel strategy.

CustomersQ2 2025Q3 2025Q4 2025Q1 2026Q2 2026Direct4,8624,8564,8674,8954,919Indirect504516515530540Total5,3665,3725,3825,4255,459  Use and Reconciliation of Non-GAAP Financial Measures

In addition to our results determined in accordance with accounting principles generally accepted in the U.S. (“GAAP”) and key business metrics described above, we have calculated non-GAAP cost of revenues, non-GAAP gross profit, non-GAAP gross margin, non-GAAP research and development expense, non-GAAP selling and marketing expense, non-GAAP general and administrative expense, non-GAAP operating income, non-GAAP net income, non-GAAP diluted EPS, Adjusted EBITDA, Adjusted EBITDA margin, free cash flow and free cash flow margin, which are each non-GAAP financial measures. We have provided tabular reconciliations of each of these non-GAAP financial measures to its most directly comparable GAAP financial measure.

Management uses these non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate financial performance and liquidity. Our non-GAAP financial measures are presented as supplemental disclosure as we believe they provide useful information to investors and others in understanding and evaluating our results, prospects, and liquidity period-over-period without the impact of certain items that do not directly correlate to our operating performance and that may vary significantly from period to period for reasons unrelated to our operating performance, as well as comparing our financial results to those of other companies. Our definitions of these non-GAAP financial measures may differ from similarly titled measures presented by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Thus, our non-GAAP financial measures should be considered in addition to, not as a substitute for, or in isolation from, the financial information prepared in accordance with GAAP, and should be read in conjunction with the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on February 24, 2026 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, to be filed with the SEC.

We calculate these non-GAAP financial measures as follows:

Non-GAAP cost of revenues, software subscriptions is determined by adding back to GAAP cost of revenues, software subscriptions, the stock-based compensation expense, and depreciation and amortization of capitalized software and acquired intangible assets included in cost of subscription revenues for the respective periods.Non-GAAP cost of revenues, services is determined by adding back to GAAP cost of revenues, services, the stock-based compensation expense included in cost of revenues, services for the respective periods.Non-GAAP gross profit is determined by adding back to GAAP gross profit the stock-based compensation expense, and depreciation and amortization of capitalized software and acquired intangible assets included in cost of subscription revenues for the respective periods.Non-GAAP gross margin is determined by dividing non-GAAP gross profit by total revenues for the respective periods.Non-GAAP research and development expense is determined by adding back to GAAP research and development expense the stock-based compensation expense and transaction costs related to acquired technology included in research and development expense for the respective periods.Non-GAAP selling and marketing expense is determined by adding back to GAAP selling and marketing expense the stock-based compensation expense and the amortization of acquired intangible assets included in selling and marketing expense for the respective periods.Non-GAAP general and administrative expense is determined by adding back to GAAP general and administrative expense the stock-based compensation expense, amortization of cloud computing implementation costs, severance expense, acquisition-related retained employee compensation, and transaction costs included in general and administrative expense for the respective periods.Non-GAAP operating income is determined by adding back to GAAP loss or income from operations the stock-based compensation expense, depreciation and amortization of capitalized software and acquired intangible assets, amortization of cloud computing implementation costs, severance expense, acquisition contingent consideration, changes in the fair value of acquisition contingent earn-outs, acquisition-related retained employee compensation, and transaction costs included in GAAP loss or income from operations for the respective periods.Non-GAAP net income is determined by adding back to GAAP net income or loss income tax benefit or expense, stock-based compensation expense, depreciation and amortization of capitalized software and acquired intangible assets, amortization of cloud computing implementation costs, severance expense, acquisition contingent consideration, changes in the fair value of acquisition contingent earn-outs, acquisition-related retained employee compensation, and transaction costs included in GAAP income or loss from operations for the respective periods, to determine non-GAAP income or loss before income taxes. Non-GAAP income or loss before income taxes is then adjusted for income taxes calculated using the respective statutory tax rates for applicable jurisdictions, which for purposes of this determination were assumed to be 25.5%.Non-GAAP net income per diluted share of Class A and Class B common stock (“Non-GAAP diluted EPS”) is determined by dividing non-GAAP net income by the weighted average shares outstanding of all classes of common stock, inclusive of the impact of dilutive common stock equivalents to purchase such common stock, including stock options, restricted stock awards, restricted stock units and employee stock purchase plan shares. Additionally, the dilutive effect of shares issuable upon conversion of the senior convertible notes is included in the calculation of Non-GAAP diluted EPS by application of the if-converted method.Adjusted EBITDA is determined by adding back to GAAP net income or loss the net interest income or expense, income tax expense or benefit, depreciation and amortization of property and equipment, depreciation and amortization of capitalized software and acquired intangible assets, amortization of cloud computing implementation costs, severance expense, acquisition contingent consideration, changes in the fair value of acquisition contingent earn-outs, acquisition-related retained employee compensation, and transaction costs included in GAAP net income or loss for the respective periods.Adjusted EBITDA margin is determined by dividing Adjusted EBITDA by total revenues for the respective periods.Free cash flow is determined by adjusting net cash provided by (used in) operating activities by purchases of property and equipment and capitalized software additions for the respective periods.Free cash flow margin is determined by dividing free cash flow by total revenues for the respective periods. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view these non-GAAP financial measures in conjunction with the related GAAP financial measures.

 Vertex, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)   As of June 30, As of December 31,(In thousands, except per share data) 2026  2025   (unaudited)   Assets       Current assets:       Cash and cash equivalents $ 230,489  $ 314,009 Funds held for customers   26,497    24,286 Accounts receivable, net of allowance of $12,271 and $11,466, respectively   153,432    183,446 Prepaid expenses and other current assets   81,527    38,966 Total current assets   491,945    560,707 Property and equipment, net of accumulated depreciation   220,471    209,727 Capitalized software, net of accumulated amortization   34,262    35,480 Goodwill and other intangible assets   402,734    396,006 Deferred commissions   29,166    31,907 Deferred income tax asset   127    85 Operating lease right-of-use assets   8,366    9,678 Long-term investment   15,000    15,000 Other assets   8,076    12,245 Total assets $ 1,210,147  $ 1,270,835 Liabilities and Stockholders' Equity      Current liabilities:        Accounts payable $ 37,313  $ 37,557 Accrued expenses   34,549    43,642 Customer funds obligations   24,639    21,802 Accrued salaries and benefits   20,612    23,992 Accrued variable compensation   27,552    34,593 Deferred revenue, current   382,151    382,839 Current portion of operating lease liabilities   4,470    4,283 Current portion of finance lease liabilities   33    55 Purchase commitment and contingent consideration liabilities, current   33,100    25,900 Total current liabilities   564,419    574,663 Deferred revenue, net of current portion   4,750    5,209 Debt, net of current portion   338,605    337,477 Operating lease liabilities, net of current portion   6,776    8,903 Finance lease liabilities, net of current portion   38    54 Purchase commitment and contingent consideration liabilities, net of current portion   40,900    79,600 Deferred income tax liabilities   13,172    5,664 Deferred other liabilities   380    345 Total liabilities   969,040    1,011,915 Stockholders' equity:       Preferred shares, $0.001 par value, 30,000 shares authorized; no shares issued and outstanding   —    — Class A voting common stock, $0.001 par value, 300,000 shares authorized; 79,414 and 77,580 shares issued and outstanding, respectively   79    77 Class B voting common stock, $0.001 par value, 150,000 shares authorized; 82,156 and 82,156 shares issued and outstanding, respectively   82    82 Treasury stock, at cost, 3,888 and 504 shares, respectively   (56,696)   (10,094)Additional paid in capital   347,768    316,327 Accumulated deficit   (39,571)   (46,104)Accumulated other comprehensive loss   (10,555)   (1,368)Total stockholders' equity   241,107    258,920 Total liabilities and stockholders' equity $ 1,210,147  $ 1,270,835         Vertex, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income (Loss)
(Unaudited)  Three months ended  Six months ended  June 30,  June 30, (In thousands, except per share data)2026  2025  2026  2025  (unaudited) (unaudited)Revenues:           Software subscriptions$ 174,753  $ 157,844  $ 341,899  $ 308,605 Services  29,217    26,715    58,717    53,016 Total revenues  203,970    184,559    400,616    361,621 Cost of revenues:               Software subscriptions  52,170    44,459    103,346    88,704 Services  20,500    18,900    41,101    38,723 Total cost of revenues  72,670    63,359    144,447    127,427 Gross profit  131,300    121,200    256,169    234,194 Operating expenses:               Research and development  24,805    20,582    49,355    41,468 Selling and marketing  51,899    48,454    104,534    96,609 General and administrative  51,142    43,392    105,481    88,420 Depreciation and amortization  6,720    6,187    13,162    12,067 Change in fair value of acquisition contingent earn-outs  (100)   2,300    (5,838)   (12,400)Other operating expense, net  1,277    4,149    4,524    7,408 Total operating expenses  135,743    125,064    271,218    233,572 Income (loss) from operations  (4,443)   (3,864)   (15,049)   622 Interest income, net  (344)   (1,228)   (1,301)   (2,767)Income (loss) before income taxes  (4,099)   (2,636)   (13,748)   3,389 Income tax benefit  (13,142)   (1,675)   (20,281)   (6,780)Net income (loss)  9,043    (961)   6,533    10,169 Other comprehensive (income) loss:           Foreign currency translation adjustments, net of tax  2,737    (29,734)   9,187    (44,839)Unrealized loss on investments, net of tax  —    —    —    9 Total other comprehensive income (loss), net of tax  2,737    (29,734)   9,187    (44,830)Total comprehensive income (loss)$ 6,306  $ 28,773  $ (2,654) $ 54,999             Net income (loss) per share of Class A and Class B, basic$ 0.06  $ (0.01) $ 0.04  $ 0.06 Net income (loss) per share of Class A and Class B, diluted$ 0.06  $ (0.01) $ 0.04  $ 0.06              Vertex, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)    Six months ended   June 30,(In thousands)  2026 2025   (unaudited)Cash flows from operating activities:       Net income  $6,533  $10,169 Adjustments to reconcile net income to net cash provided by operating activities:       Depreciation and amortization   56,177   45,694 Amortization of cloud computing implementation costs   2,395   2,024 Provision for subscription cancellations and non-renewals   629   (136)Amortization of deferred financing costs   1,361   1,361 Change in fair value of contingent consideration liabilities   (5,838)  (12,200)Stock-based compensation expense   32,270   33,034 Deferred income taxes   6,051   (1,641)Non-cash operating lease costs   2,226   1,595 Other   15   (71)Changes in operating assets and liabilities, net of the effects of business acquisition(s):       Accounts receivable   29,887   22,320 Prepaid expenses and other current assets   (44,994)  (13,406)Deferred commissions   2,741   (258)Accounts payable   (288)  (5,886)Accrued expenses   (9,185)  6,446 Accrued and deferred compensation   (11,333)  (29,766)Deferred revenue   (812)  2,374 Operating lease liabilities   (2,827)  (2,057)Payments for purchase commitment and contingent consideration liabilities in excess of initial fair value   —   (200)Other   3,863   1,412 Net cash provided by operating activities   68,871   60,808 Cash flows from investing activities:       Acquisition of businesses and assets, net of cash acquired   (21,968)  — Long-term investment   —   (15,000)Property and equipment additions   (47,831)  (42,906)Capitalized software additions   (10,648)  (10,565)Purchase of investment securities, available-for-sale   —   (2,398)Proceeds from sales and maturities of investment securities, available-for-sale   —   11,607 Net cash used in investing activities   (80,447)  (59,262)Cash flows from financing activities:       Net increase (decrease) in customer funds obligations   2,838   (3,493)Repurchases of shares   (46,602)  — Proceeds from purchases of stock under ESPP   1,807   1,782 Payments for taxes related to net share settlement of stock-based awards   (7,936)  (26,105)Proceeds from exercise of stock options   441   7,687 Payments for acquisition contingent cash earn-out   (19,600)  — Payments of finance lease liabilities   (39)  (28)Net cash used in financing activities   (69,091)  (20,157)Effect of exchange rate changes on cash, cash equivalents and restricted cash   (642)  3,307 Net decrease in cash, cash equivalents and restricted cash   (81,309)  (15,304)Cash, cash equivalents and restricted cash, beginning of period   338,295   326,066 Cash, cash equivalents and restricted cash, end of period  $256,986  $310,762 Reconciliation of cash, cash equivalents and restricted cash to the Condensed Consolidated Balance Sheets, end of period:       Cash and cash equivalents  $230,489  $284,386 Restricted cash—funds held for customers   26,497   26,376 Total cash, cash equivalents and restricted cash, end of period  $256,986  $310,762   Summary of Non-GAAP Financial Measures
(Unaudited)   Three months ended Six months ended   June 30, June 30, (Dollars in thousands, except per share data) 2026 2025 2026 2025 Non-GAAP cost of revenues, software subscriptions $29,205 $26,556 $58,550 $52,719 Non-GAAP cost of revenues, services $19,566 $17,876 $38,496 $36,003 Non-GAAP gross profit $155,199 $140,127 $303,570 $272,899 Non-GAAP gross margin  76.1% 75.9% 75.8% 75.5%Non-GAAP research and development expense $22,365 $18,070 $43,049 $34,604 Non-GAAP selling and marketing expense $47,080 $44,648 $93,847 $86,466 Non-GAAP general and administrative expense $34,587 $38,071 $71,631 $74,673 Non-GAAP operating income $44,295 $32,182 $81,916 $63,521 Non-GAAP net income $33,256 $24,891 $61,997 $49,385 Non-GAAP diluted EPS $0.20 $0.15 $0.37 $0.30 Adjusted EBITDA $51,015 $38,369 $95,078 $75,588 Adjusted EBITDA margin  25.0% 20.8% 23.7% 20.9%Free cash flow $2,733 $19,587 $10,392 $7,337 Free cash flow margin  1.3% 10.6% 2.6% 2.0%  Vertex, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)   Three months ended Six months ended   June 30, June 30, (Dollars in thousands) 2026 2025 2026 2025 Non-GAAP Cost of Revenues, Software Subscriptions:             Cost of revenues, software subscriptions $52,170  $44,459  $103,346  $88,704  Stock-based compensation expense  (1,083)  (1,233)  (2,828)  (3,460) Depreciation and amortization of capitalized software and acquired intangible assets – cost of subscription revenues  (21,882)  (16,670)  (41,968)  (32,525) Non-GAAP cost of revenues, software subscriptions $29,205  $26,556  $58,550  $52,719                Non-GAAP Cost of Revenues, Services:             Cost of revenues, services $20,500  $18,900  $41,101  $38,723  Stock-based compensation expense  (934)  (1,024)  (2,605)  (2,720) Non-GAAP cost of revenues, services $19,566  $17,876  $38,496  $36,003                Non-GAAP Gross Profit:             Gross profit $131,300  $121,200  $256,169  $234,194  Stock-based compensation expense  2,017   2,257   5,433   6,180  Depreciation and amortization of capitalized software and acquired intangible assets – cost of subscription revenues  21,882   16,670   41,968   32,525  Non-GAAP gross profit $155,199  $140,127  $303,570  $272,899                Non-GAAP Gross Margin:             Total Revenues $203,970  $184,559  $400,616  $361,621  Non-GAAP gross margin  76.1 % 75.9 % 75.8 % 75.5 %              Non-GAAP Research and Development Expense:             Research and development expense $24,805  $20,582  $49,355  $41,468  Stock-based compensation expense  (2,440)  (2,512)  (6,306)  (6,864) Non-GAAP research and development expense $22,365  $18,070  $43,049  $34,604                Non-GAAP Selling and Marketing Expense:             Selling and marketing expense $51,899  $48,454  $104,534  $96,609  Stock-based compensation expense  (4,297)  (3,235)  (9,640)  (9,041) Amortization of acquired intangible assets – selling and marketing expense  (522)  (571)  (1,047)  (1,102) Non-GAAP selling and marketing expense $47,080  $44,648  $93,847  $86,466                Non-GAAP General and Administrative Expense:             General and administrative expense $51,142  $43,392  $105,481  $88,420  Stock-based compensation expense  (5,008)  (3,986)  (10,891)  (10,949) Severance expense(1)  (2,689)  (317)  (10,097)  (774) Acquisition-related retained employee compensation(2)  (1,250)  —   (1,667)  —  Transaction costs(3)  (6,250)  —   (8,800)  —  Amortization of cloud computing implementation costs – general and administrative expense  (1,358)  (1,018)  (2,395)  (2,024) Non-GAAP general and administrative expense $34,587  $38,071  $71,631  $74,673    Vertex, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures (continued)
(Unaudited)  Three months ended Six months ended  June 30, June 30, (In thousands, except per share data)2026 2025 2026 2025 Non-GAAP Operating Income:            Income (loss) from operations$(4,443) $(3,864) $(15,049) $622  Stock-based compensation expense 13,762   11,990   32,270   33,034  Depreciation and amortization of capitalized software and acquired intangible assets – cost of subscription revenues 21,882   16,670   41,968   32,525  Amortization of acquired intangible assets – selling and marketing expense 522   571   1,047   1,102  Amortization of cloud computing implementation costs – general and administrative expense 1,358   1,018   2,395   2,024  Severance expense(1) 2,689   317   10,097   774  Acquisition contingent consideration —   200   —   200  Change in fair value of acquisition contingent earn-outs (100)  2,300   (5,838)  (12,400) Acquisition-related retained employee compensation(2) 1,250   —   1,667   —  Transaction costs(3) 7,375   2,980   13,359   5,640  Non-GAAP operating income$44,295  $32,182  $81,916  $63,521                            Non-GAAP Net Income:            Net income (loss)$9,043  $(961) $6,533  $10,169  Income tax benefit (13,142)  (1,675)  (20,281)  (6,780) Stock-based compensation expense 13,762   11,990   32,270   33,034  Depreciation and amortization of capitalized software and acquired intangible assets – cost of subscription revenues 21,882   16,670   41,968   32,525  Amortization of acquired intangible assets – selling and marketing expense 522   571   1,047   1,102  Amortization of cloud computing implementation costs – general and administrative expense 1,358   1,018   2,395   2,024  Severance expense(1) 2,689   317   10,097   774  Acquisition contingent consideration —   200   —   200  Change in fair value of acquisition contingent earn-outs (100)  2,300   (5,838)  (12,400) Acquisition-related retained employee compensation(2) 1,250   —   1,667   —  Transaction costs(3) 7,375   2,980   13,359   5,640  Non-GAAP income before income taxes 44,639   33,410   83,217   66,288  Income tax adjustment at statutory rate(4) (11,383)  (8,519)  (21,220)  (16,903) Non-GAAP net income$33,256  $24,891  $61,997  $49,385               Non-GAAP Diluted EPS:            Non-GAAP net income$33,256  $24,891  $61,997  $49,385  Interest expense (net of tax), convertible senior notes(5) 903   903   1,806   1,806  Non-GAAP net income used in dilutive per share computation$34,159  $25,794  $63,803  $51,191               Weighted average Class A and B common stock, diluted 161,392   162,589   161,337   162,656  Dilutive effect of convertible senior notes(5) 9,498   9,498   9,498   9,498  Total average Class A and B shares used in dilutive per share computation 170,890   172,087   170,835   172,154  Non-GAAP diluted EPS$0.20  $0.15  $0.37  $0.30  (1)  The three and six months ended June 30, 2026 periods include $1,713 and $7,883, respectively, in severance costs related to the Value Creation Plan. (2)  The acquisition-related compensation expenses recorded for the three and six months ended June 30, 2026 are related to the additional cash consideration payments of $10,000 to the sellers (the “Additional Cash Consideration”) in connection with the acquisition of Finta Inc. and its subsidiaries (“Brinta”). (3)  The three and six months ended June 30, 2026 periods include $6,250 and $8,800, respectively, in costs incurred to support the execution of our Value Creation Plan, recorded in general and administrative expense. Amounts also include legal expenses associated with pending litigation related to claims the Company has made against a competitor. (4)  Non-GAAP income before income taxes is adjusted for income taxes using the respective statutory tax rates for applicable jurisdictions, which for purposes of this determination were assumed to be 25.5%. (5)  We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. Interest expense and additional dilutive shares related to the notes are added back to the calculation when their impact is dilutive. In periods when the impact is anti-dilutive, there is no add-back of interest expense or additional dilutive shares related to the notes.   Vertex, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures (continued)
(Unaudited)  Three months ended Six months ended  June 30, June 30, (Dollars in thousands)2026 2025 2026 2025 Adjusted EBITDA:            Net income (loss)$9,043  $(961) $6,533  $10,169  Interest income, net (344)  (1,228)  (1,301)  (2,767) Income tax benefit (13,142)  (1,675)  (20,281)  (6,780) Depreciation and amortization – property and equipment 6,720   6,187   13,162   12,067  Depreciation and amortization of capitalized software and acquired intangible assets – cost of subscription revenues 21,882   16,670   41,968   32,525  Amortization of acquired intangible assets – selling and marketing expense 522   571   1,047   1,102  Amortization of cloud computing implementation costs – general and administrative expense 1,358   1,018   2,395   2,024  Stock-based compensation expense 13,762   11,990   32,270   33,034  Severance expense(1) 2,689   317   10,097   774  Acquisition contingent consideration —   200   —   200  Change in fair value of acquisition contingent earn-outs (100)  2,300   (5,838)  (12,400) Acquisition-related retained employee compensation(2) 1,250   —   1,667   —  Transaction costs(3) 7,375   2,980   13,359   5,640  Adjusted EBITDA$51,015  $38,369  $95,078  $75,588               Adjusted EBITDA Margin:            Total revenues$203,970  $184,559  $400,616  $361,621  Adjusted EBITDA margin 25.0 % 20.8 % 23.7 % 20.9 %(1)The three and six months ended June 30, 2026 periods include $1,713 and $7,883, respectively, in severance costs related to the Value Creation Plan.(2)The acquisition-related compensation expenses recorded for the three and six months ended June 30, 2026 are related to the Additional Cash Consideration obligation associated with the acquisition of Brinta.(3)The three and six months ended June 30, 2026 periods include $6,250 and $8,800, respectively, in costs incurred to support the execution of our Value Creation Plan. Amounts also include legal expenses associated with pending litigation related to claims the Company has made against a competitor.   Three months ended Six months ended   June 30, June 30, (Dollars in thousands) 2026 2025 2026 2025 Free Cash Flow:             Cash provided by operating activities $30,896  $46,003  $68,871  $60,808  Property and equipment additions  (23,171)  (21,512)  (47,831)  (42,906) Capitalized software additions  (4,992)  (4,904)  (10,648)  (10,565) Free cash flow $2,733  $19,587  $10,392  $7,337                Free Cash Flow Margin:             Total revenues $203,970  $184,559  $400,616  $361,621  Free cash flow margin  1.3 % 10.6 % 2.6 % 2.0 % Investor Relations Contact:
Joe Crivelli
Vertex, Inc.
[email protected]

Media Contact:
Simone Sonnier
Vertex, Inc.
[email protected]

Key Takeaways VRTX is set to report Q2 results on Aug. 3, with consensus estimates of $3.23B for revenues and $4.85 for EPS.Vertex's Q2 2026 results are expected to be led by CF drugs Trikafta/Kaftrio and Alyftrek.VRTX expects Alyftrek, Casgevy and Journavx growth in Q2 backed by rising prescriptions. Vertex Pharmaceuticals (VRTX - Free Report) is scheduled to report its second-quarter 2026 results on Aug. 3, after market close. The Zacks Consensus Estimate for the to-be-reported quarter’s revenues is pegged at $3.23 billion, while the same for earnings is $4.85 per share.

Let’s see how things might have shaped up before the announcement.

Factors Likely to Influence VRTX's Q2 ResultsVertex’s revenues in the to-be-reported quarter are likely to have been driven by strong demand for its blockbuster cystic fibrosis (“CF”) medicine, Trikafta/Kaftrio (Trikafta’s brand name in Europe). The drug accounts for the majority of Vertex’s total revenues.

The Zacks Consensus Estimate for Trikafta/Kaftrio sales is currently pegged at $2.45 billion for the second quarter of 2026.

Meanwhile, higher Trikafta/Kaftrio sales are likely to have caused sales erosion of VRTX’s other CF drugs — Symdeko (marketed as Symkevi in Europe), Orkambi and Kalydeco.

As Vertex’s CF franchise sales continue to grow, we expect investors to focus on the sales performance of its fifth CF medicine, Alyftrek (vanza triple), during the second quarter.

Alyftrek sales increased sequentially in the last reported quarter, a trend most likely to have continued in the to-be-reported quarter. Per management, the U.S. and European launch of Alyftrek is progressing well across all patient groups.

The company expects rising patient numbers from the label expansions for Alyftrek and Trikafta, along with launches of Alyftrek in additional geographies for treating younger patients, to drive CF growth in the to-be-reported quarter.

Year to date, shares of Vertex have risen 5.3% compared with the industry’s increase of 2.6%.

Image Source: Zacks Investment Research

Q2 Sales Expectation for VRTX’s Non-CF ProductsVertex and its partner CRISPR Therapeutics’ (CRSP - Free Report) one-shot gene therapy, Casgevy, is approved for two blood disorders — sickle cell disease and transfusion-dependent beta-thalassemia.

Vertex leads the global development and commercialization of Casgevy under the terms of the 2021 agreement, with support from CRISPR Therapeutics.

Casgevy sales decreased on a sequential basis in the last quarter due to quarter-to-quarter variability in infusions. It remains to be seen whether the same trend continued or reversed in the quarter to be reported. Nonetheless, the launch of Casgevy has been gaining traction across the United States, Europe and the Middle East. Vertex is also making rapid progress in the drug’s access and reimbursement. An update is expected on the call.

VRTX’s novel non-opioid pain medicine Journavx (suzetrigine) was approved by the FDA in January 2025. Journavx’s sales improved sequentially in the last quarter, driven by strong prescription growth. Also, the drug’s launch metrics and early reimbursement progress look favorable. Vertex expects higher sales from Journavx in the second quarter as prescription volumes are rising.

Several updates related to Vertex’s pipeline candidates, which are in mid- to late-stage studies for treating diseases like acute and neuropathic pain, APOL1-mediated kidney disease, IgA nephropathy, primary membranous nephropathy, and cell therapy for type I diabetes, are also expected on the upcoming earnings call.

VRTX’s Recent Key DevelopmentsIn June 2026, the FDA accepted VRTX’s regulatory filing seeking approval for its investigational candidate, povetacicept, for treating adults with immunoglobulin A nephropathy (IgAN), a rare progressive kidney disease. A final decision from the FDA is expected on Nov. 30, 2026.

Also, Vertex recently agreed to acquire all outstanding shares of Crinetics Pharmaceuticals for $85 per share, valuing the deal at around $10 billion. The transaction is expected to be closed in the third quarter of 2026.

The impending acquisition will add Crinetics’ first marketed drug, Palsonify, which is the first once-daily oral therapy approved for treating adults with acromegaly, to Vertex’s commercial portfolio. The company will also add several of Crinetics’ pipeline candidates to its portfolio.

VRTX's Earnings Surprise HistoryVertex has a mixed record of earnings surprises over the trailing four quarters. The company beat earnings estimates in three of the trailing four quarters, while missing the same on the remaining occasion, delivering an average surprise of 4.24%. In the last reported quarter, VRTX delivered an earnings surprise of 5.67%.

Earnings Whispers for VRTX StockOur proven model does not conclusively predict an earnings beat for Vertex this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here, as you will see below. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

VRTX’s Earnings ESP: Vertex’s Earnings ESP is -0.86% as the Most Accurate Estimate currently stands at $4.80, lower than the Zacks Consensus Estimate of $4.85.

VRTX’s Zacks Rank: Vertex currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks to ConsiderHere are some stocks worth considering from the healthcare space, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

Acadia Pharmaceuticals (ACAD - Free Report) has an Earnings ESP of +25.00% and a Zacks Rank #2 at present.

Shares of ACAD have lost 7% year to date. Acadia’s earnings beat estimates in three of the trailing four quarters and missed on the remaining occasion, delivering an average surprise of 20.83%. Acadia is scheduled to report second-quarter results on Aug. 4.

Pfizer (PFE - Free Report) has an Earnings ESP of +2.07% and a Zacks Rank #3 at present.

Shares of Pfizer have risen 3.7% so far this year. Pfizer beat earnings estimates in each of the last four reported quarters, delivering an average earnings surprise of 21.93%. Pfizer is scheduled to report second-quarter results on Aug. 4.

Vertex Pharmaceuticals (VRTX 0.45%) is a biotech company that has steadily delivered growth to investors, thanks to its dominance in cystic fibrosis (CF) treatment. The company's portfolio of CF drugs has transformed the lives of patients and helped Vertex's earnings soar well into the billions of dollars. This is likely to continue as Vertex's solid intellectual property extends its leadership through at least the late 2030s.

And in recent years, Vertex has made moves to make this story even brighter. This is by broadening its presence into other areas, with launches of a gene editing treatment for blood disorders and a pain management drug. The company has also used acquisitions to grow, and this brings me to the recent $10 billion move.

Vertex this week announced its acquisition of Crinetics Pharmaceuticals (CRNX +0.16%), a company that may add $5 billion in peak annual revenue to Vertex's top line. With this deal taking shape, is Vertex a buy? Let's find out.

Image source: Getty Images.

Vertex's CF leadership First, let's take a look at Vertex's portfolio and general situation prior to the Crinetics move. As mentioned, the biotech is the global CF leader, specializing in CFTR modulators. These therapies correct the malfunctioning protein that causes symptoms of the disease. Since genetic mutations result in different problems with the protein, one CFTR modulator may not work for every patient. But Vertex's top drugs, Alyftrek and Trikafta, cover a lot of territory: They have the potential to treat more than 90% of the CF population.

Meanwhile, the company continues to work on possible treatments, in partnership with Moderna, for patients who can't be treated by the company's CFTR modulators. And Vertex is also developing its next generation of CF therapies. Considering the company's expertise in this area and deep pipeline, there's reason to be optimistic about leadership lasting well into the future -- and fueling steady growth. And an advancing pipeline in serious rare diseases, as well as the more common area of pain, should further bolster growth over the long run.

This expansion into other treatment areas is already bearing fruit. Earlier this year, the biotech predicted that non-CF products would contribute at least $500 million to 2026 revenue. The company has established a long track record of growth, with revenue climbing more than 600% over the past decade to $12 billion in the latest full year. And profit has also advanced, reaching more than $3 billion.

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A recently approved drug Now, let's consider the Crinetics move. Vertex is buying the company, which offers it access to the recently approved Palsonify for acromegaly, a chronic disorder caused by the overproduction of growth hormone. About 20,000 Americans are living with this disorder today. Palsonify could stand out because it's the first daily, oral treatment -- a more convenient option than the current infusions. The companies say early uptake of the drug has been strong.

Along with a pipeline of candidates and research, the deal also gives Vertex phase 3 asset atumelnant for congenital adrenal hyperplasia (CAH). The disorder, impacting 17,000 people in the U.S., involves excess androgen production that results in a variety of serious symptoms. Atumelnant could reshape the treatment landscape for this disease and also holds potential to treat Cushing's syndrome.

Together, these treatments may bring in peak revenue of $5 billion, and Vertex says this would support its goal of producing sustained revenue growth in the double digits.

Vertex is paying $10 billion, or $85 per share, in an all-cash deal. This is two times the projected peak sales figure -- and this level of sales isn't necessarily guaranteed since atumelnant hasn't yet reached the regulatory approval stage. So, this isn't a dirt cheap price, and the intended goals aren't guaranteed. This means some risk is involved.

Still, it's a fair price considering the strength of the late-stage pipeline and a wise move for Vertex as Crinetics fits nicely into its portfolio. Crinetics' specialty in rare endocrine disorders resembles Vertex's focus on CF: Both companies prioritize serious diseases within a specialty area and with significant unmet need. And these diseases involve well-understood biology that may be targeted to transform their treatment. Vertex is also entering this story at the right time, shortly after the Palsonify launch, so that it may apply its commercialization expertise early on. And this adds an important new specialty area to the Vertex portfolio.

Though this deal may not generate enormous results overnight -- it's expected to be accretive to non-GAAP operating income in 2029 -- I think it's worth the wait. And that makes Vertex a fantastic biotech growth stock to buy and hold.

A sign hangs in front of the world headquarters of Vertex Pharmaceuticals in Boston, Massachusetts, U.S., October 23, 2019. REUTERS/Brian Snyder/File Photo Purchase Licensing Rights, opens new tab

CompaniesJuly 1 (Reuters) - The U.S. Food and Drug Administration approved expanded use of Vertex Pharmaceuticals' (VRTX.O), opens new tab gene therapy in children as ​young as two with inherited blood disorders, including ‌sickle cell disease, the first such treatment cleared for this age group.

Casgevy, a one-time treatment made from a patient's own blood stem ​cells, was previously approved for patients aged 12 ​and older with sickle cell disease or transfusion-dependent ⁠beta thalassemia.

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Here are further details: -

Sickle cell disease is a ​painful, inherited blood disorder in which the body makes sickle-shaped ​hemoglobin, preventing red blood cells from properly carrying oxygen to the body's tissues.

In a trial of children aged five to under 12 ​with sickle cell disease, all eight evaluable patients had ​no severe vaso-occlusive crises or painful episodes for at least 12 straight ‌months ⁠within the first 24 months of infusion.

In beta thalassemia, eight of nine evaluable children achieved transfusion independence for 12 consecutive months, with a median duration of 20.1 months.

The ​FDA granted approval ​to Vertex ⁠in 53 days after filing under the Commissioner's National Priority Voucher, its new fast-track ​program designed to shorten review time for a ​drug ⁠application.

In 2023, the FDA approved Vertex's and Genetix Biotherapeutics' gene therapies for sickle cell disease in patients 12 years and older.

Other ⁠long-term ​treatment options for sickle cell disease ​include bone marrow transplant, which requires matching donors, and the chemotherapy drug ​hydroxyurea.

Reporting by Puyaan Singh in Bengaluru; Editing by Vijay Kishore

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