VTEX (VTEX) 2025 Q4 法說會逐字稿

Hello, everyone, and welcome to the VTEX earnings conference call for the quarter ended December 31, 2025. I'm Julia Vater Fernández, VP of Investor Relations for VTEX. Our senior executives presenting today are Geraldo Thomaz, Jr., Founder and Co-CEO; and Ricardo Camatta Sodré, Chief Financial Officer. Additionally, Mariano Gomide de Faria, Founder and Co-CEO; and André Spolidoro, Chief Strategy Officer, will be available during today's Q&A session.

I would like to remind you that management may make forward-looking statements relating to such matters as continuous growth prospects for the company, industry trends, and product and technology initiatives. These statements are based on currently available information and our current assumptions, expectations, and projections about future events. While we believe that our assumptions, expectations, and projections are reasonable in view of the current available information, you have caution not to place a new reliance on these forward-looking statements.

Certain risks and uncertainties are described under Risk Factors and forward-looking statements sections of VTEX Form 20-F for the year ended December 31, 2025, and other VTEX filings within the US Securities and Exchange Commission, which are available on our Investor Relations website.

Finally, I would like to remind you that during the course of this conference call, we might discuss some non-GAAP measures. A reconciliation of those measures to the nearest comparable GAAP measures can be found in our fourth-quarter 2025 earnings press release available on our Investor Relations website.

With that, I hand the call over to Geraldo. Geraldo, the floor is yours.

Thank you, Julia, and good afternoon, everyone. Thank you for joining us today. Today's call is primarily about giving shareholder transparency into how we're positioning VTEX to strengthen growth over time.

Let me start by acknowledging that our recent growth has been below our long-term ambition. We believe that this is largely cyclical, not structural, driven primarily by three external factors: a more challenging macroenvironment in Brazil and Argentina, and a more promotional marketplace environment in Brazil, and longer decision cycles as enterprises reassess its priorities in a rapidly evolving AI landscape.

More broadly, we recognize the market debate around AI and what it means for software. Although the combination of rapid AI innovation with limited tangible commerce applications so far may elongate sales cycle, the consistent view from our conversations with enterprise CIOs is that AI will change how software is built and operated, but it won't eliminate the need for deeply integrated enterprise-grade platforms that run mission-critical processes.

And while AI lowers the cost of writing code, it raises the bar for security, complex integrations, and reliability. Precisely, the attributes enterprises rely on VTEX to provide and consistent with broadly stable dollar churn we delivered in 2025. As value shifts from seat-based to outcome-based, VTEX is certainly aligned with this shift. We are not just building AI features. We're building the mission-critical backbone for connected commerce that global brands can rely on to deploy AI safely and effectively.

We couldn't dive deeper into each of the three external factors mentioned. But as we cannot control the environment, let's focus on what we can control, our execution and product road map.

Starting on that, we see a clear opportunity to improve growth with a plan anchored in four levers: global expansion, B2B, retail media, and AI. While we execute this growth plan, our enterprise focus remains front and center. In 2025, customers generating over $250,000 in ARR reached 158, with revenue from this cohort up 13% year over year. And to illustrate the relevance of our plan, in Q4, our four growth levers represented roughly 15% of subscription revenue, delivering approximately 20% FX-neutral growth and contributing to nearly half of subscription revenue growth.

The addressable market for these levers is materially larger than our core Latin American opportunity, and we believe we are well-positioned competitively, so our focus now is disciplined execution.

With that, let me bring our four growth levels to life. First, global expansion. We're winning and scaling in markets where complexity is highest. In 2025, global markets delivered 22% subscription revenue growth. For instance, in Europe, our partnership with Manchester City reached its first milestone with the Stadium Tour Store, offering personalized fan experiences in a single high-performance flow.

Second, B2B. We're modernizing large enterprises by delivering complex capabilities that are AI-ready and composable by design, such as contract pricing, curated catalogs, punch-outs, and omnichannel fulfillment. Mondelēz launched B2B in Brazil on VTEX, extending a multi-region footprint. While we're still early in the mix, B2B demand in the US and Europe signals a durable shift, one we are now driving to digitalize across Latin America as well.

Third, retail media. 2025 was a turning point. We moved from pilots to a core growth engine with clear margin-accretive outcomes. With VTEX Ads, customers run on-site, off-site and in-store campaigns and measure them end-to-end through closed-loop attribution anchored in first-party data.

The retail media market evolution plays directly to our integrated model. Enterprise retailers monetize traffic they already own, brands gain performance media tied to transactions, and both parties see results in a single source of food. For example, [SET] achieved a 39% increase in average conversion rate on average ROAS of above 17 times and consistent month-over-month acceleration in sales driven by retail media performance, demonstrating the power of data-driven campaigns to elevate brand performance in digital retail environments.

Finally, AI. Our work here spans two dimensions. First, our product. We're redesigning VTEX with an AI-first approach. For example, leading Brazilian retailers like Americanas and C&A are using Weni by VTEX to automate high-volume support journeys with deep enterprise integrations such as orders, invoice, and CRM, reducing manual ticketing, speeding resolution, and improving customer satisfaction.

Beyond Weni by VTEX, we see AI reshaping how commerce is built, operated, and optimized. We're embedding intelligence across the platform while simultaneously rethinking how we build commerce and run the company. Our multi-tenant architecture and role as a mission-critical commerce data aggregator give us advantages that point solutions and legacy platforms can't easily replicate.

Second, our own operations. AI is already showing up results. Automation in support has expanded gross margins by approximately 3 percentage points. And in December, we implemented a reorganization in sales and marketing that impacted almost 100 headcounts. This move simplified management layers and centralized our global team for greater agility and efficiency. As we embrace an AI-first operating model, we are aligning our organizations to operate with increased speed, consistency, and technical depth.

In summary, we chose structured transformation over incremental steps. Despite the challenging environment, disciplined execution, and already identified productivity gains support continued improvement in cost ability and enable increased R&D investments that drive our AI transformation and deepen our value with top-tier customers.

We're evolving VTEX from a platform that powers commerce to a multi-product company, AI-first platform that increasingly automates and orchestrated. We will keep executing behind this plan, expanding with existing customers as they scale on VTEX and adding more enterprises to the mix. So these four growth levers translate into sustained compounding growth.

With that, and moving to the fourth quarter of 2025, we added new enterprise customers, including Atacado Vila Nova, Lofty Style, Luz da Lua, and TCL in Brazil; mercacentro in Colombia; Pharmacys and Cruz Azul in Ecuador; Llantas Avante and T-fal in Mexico.

We also saw expansion activity within our existing customer base, such as Essilor Luxottica launched two new brands in Brazil, eÓtica and [ELANZ], adding to its existing portfolio of stores. (inaudible) launched their B2B website in Colombia, adding to its B2C operation running on VTEX. Mondelēz launched a B2B operation in Brazil, expanding its VTEX footprint ranging from Latin America to Europe. OBI, who expanded to Italy, adding to its operation in Germany and Austria. And Whirlpool launched KitchenAid in Canada, building on its successful store launch in the US, while continuing our global relationship in over 20 countries.

Even in a softer market environment, customers continue to choose VTEX to support strategic initiatives involving new channels, new geographies, and more complex operating models.

Now, before I hand over the call to Ricardo, I would like to express my sincere gratitude to our 1,139 VTEX employees whose dedication and adaptability were critical. I also would like to thank you, customers, partners, and investors for their trust and support.

Ricardo, over to you.

Thank you, Geraldo, and hello, everyone. I will now walk you through our financial performance for the fourth quarter and the full year of 2025.

Before going into the details, I'd like to frame the year in context. As mentioned by Geraldo, while the external environment pressured our customers' GMV growth and lengthened enterprise decision cycles, 2025 demonstrated the resilience of our business model and the strengthened of our unit economics. As evidence, we continue to drive efficiency gains and deliver record profitability even in a slower growth environment.

In the fourth quarter of 2025, our GMV reached $6.3 billion, representing a year-over-year growth of 17.2% in US dollars and 10.0% in FX-neutral. For the full year, GMV reached $20.5 billion, up 12.1% in US dollars and 12.9% in FX-neutral. Subscription revenue reached $66.7 million in the fourth quarter, representing a growth of 12.2% year-over-year in US dollars and 5.4% in FX-neutral. For the new year, subscription revenue reached $234.9 million, growing 7.9% in US dollars and 9.5% in FX-neutral.

Turning to revenue retention, in 2025, subscription revenue from existing stores reached $194 million, and our net revenue retention was 99.5% in FX-neutral. Annual dollar churn remained broadly stable year over year. However, given that roughly 60% of our revenue come from a take rate on our customers' GMV, the decline in net revenue retention compared to 2024 was primarily driven by lower sales-store sales growth of 6.8% in FX-neutral in 2025. This lower same-store sales growth reflected continued softness in Argentina and more muted consumer spending in Brazil, which weakened over the course of the year.

A key highlight for the year was the continued improvement in the profitability of our existing stores. Existing stores gross margin increased from 80% in 2024 to 82% in 2025, while operating margin reached 44%, representing a 1-percentage-point increase year over year. This marks the second consecutive year in which this P&L exceeded the Rule of 40, reinforcing our confidence in sustaining a Rule of 40 performance as the business scales.

Moving on to subscription revenue addition. In 2025, new stores added $25 million to our base, representing approximately 13% of our 2024 VTEX platform revenue. As discussed in prior quarters, elongated sales cycles throughout the year impacted revenue added from new stores and will carry over some impact in 2026.

On the new stores P&L, our focus remains on maintaining a healthy return on the capital allocated to sales and marketing. On that front, LTV/CAC reached approximately 4 times in 2025. The year-over-year decline in this metric was primarily driven by longer sales cycles and timing rather than changes in win rates or the underlying attractiveness of the cohort.

In fact, our continued enterprise focus drove our number of customers generating over $250,000 in ARR to reach 158 customers in 2025. While this represents only 1.9% increase in customer count, it resulted in 14.5% FX-neutral revenue increase from this cohort. Looking forward, as mentioned by Geraldo, we adjusted our sales and marketing investments, and we are reallocating capital toward R&D investments to enhance key product offerings such as B2B, retail media, and AI-powered after-sales support.

From a geographic perspective, Brazil subscription revenue grew 12.2% in FX-neutral, supported by the go-live and ramp-up of new stores despite software same-store sales. Latin America, excluding Brazil, grew 2.1% in FX-neutral, and excluding Argentina, the region grew just slightly below Brazil's pace.

Subscription revenue from global markets, formerly reported as rest of the world, grew 19.2% in effect-neutral, demonstrating continued compounding even as the base expands. Additionally, global markets represented 11.1% of our total revenue. Its contribution margin, defined as gross profit minus directly allocated sales and marketing expenses, improved significantly and approached breakeven.

Moving now the P&L. We maintain strong cost and expense discipline, while continuing to prioritize investments aimed at supporting revenue re-acceleration. All figures I would now reference are non-GAAP unless otherwise stated. You can find all GAAP to non-GAAP reconciliations on our Investor Relations website.

Subscription gross profit reached $54.6 million in the fourth quarter, resulting in 81.8% subscription gross margin, up from 78.8% in the same period of the prior year. Total gross margin increased to 79.6% compared to 75.0% in the fourth quarter of 2024, driven largely by AI-powered customer support automation and, for a smaller extent, a higher mix of subscription revenue.

Operating expenses totaled $38 million in the fourth quarter, resulting in income from operations of $16.2 million and an operating margin of 23.8%, up from 19.9% in the same period of last year.

During the quarter, we executed a reorganization in the sales and marketing to simplify layers, centralize global teams to better leverage AI as well as aligned investments with the expected demand. These actions resulted in approximately $2 million service expense above normalized level. Excluding that one-off impact, operating margin would have been just under 27%.

Free cash flow reached $11.1 million in the quarter, representing a 16.3% margin. Adjusted for one-off severance payments above normalized levels, free cash flow margin would have been just over 19%.

Considering this level of cash generation and our current cash position as a percentage of our market cap, we are announcing a new $15 million 12-month share repurchase program for Class A shares.

Looking ahead into 2026, as Geraldo highlighted at the beginning of the call, we remain focused on our four growth levers: global expansion, B2B, retail media, and AI. We are executing with discipline. The productivity we have unlocked across cost of revenue, sales and marketing, and G&A are expanding profitability while funding higher R&D to accelerate our AI transformation and deepen our value with top-tier customers.

While macro headwinds persist, we remain encouraged by the quality of new customers' additions, our competitive position among global enterprise customers, and the compelling market opportunity across our four key long-term growth initiatives.

With that, and recognizing that Q1 seasonality is our lowest GMV quarter and faces the toughest year-over-year comparison, for Q1 2026, we expect subscription revenue to grow at mid-single-digit percentage rate on an FX-neutral year-over-year basis. Gross profit to grow at a high-single-digit percentage rate on a FX-neutral year-over-year basis. Non-GAAP income from operations to be in the mid-teens percentage margin, and free cash flow to be in the high-teens percentage margin.

For the full year 2026, we are targeting subscription revenue to grow at mid- to high-single-digit percentage rate on a FX-neutral year-over-year basis. Gross profit to grow at a high-single-digit to low-teens percentage rate on an FX-neutral year-over-year basis. Non-GAAP income from operations should be in the low-20s percentage margin, and free cash flow to be in the low-20s percentage margin.

Assuming FX rates remain broadly consistent with January 2026 averages, the FX-neutral growth guidance outlined above would translate into higher reported USD subscription revenue growth, adding approximately 8.4 percentage points in the first quarter and 4.5 percentage points in the full year 2026.

Before we open to Q&A, I would like to reiterate, we are executing with discipline, investing behind our four growth levers to drive durable growth and shareholder value, and expanding profitability while maintaining a strong balance sheet.

With that, let's look at it for questions now. Thank you.

(Operator Instructions) [Leveya Mizobaba], JPMorgan.

Hi, everyone. Can you hear me? Can you hear? Hello?

Yes, we can.

Thank you. So hi, everyone. Thank you for the opportunity for asking questions. I would like to explore a little bit the point of the sales cycle. So what I would like to understand is mainly if you see a turning point on this elongated sales cycle, I mean, from your conversations with CTOs and the industry players, what is the feedback that you are having regarding this point? And is there any market intelligence that you could share with us to help us understand when this could normalize and what do you think is necessary to happen in the market to change the scenario? Is there something that you see as a turning point?

And the second point that I would like to explore is the gross margin gains in the fourth quarter. Is it all coming from AI? Is there other elements that are helping you to bring this margin level up? Thank you.

Thanks. Mariano will take the first question, and I can take the second one.

Yeah, I can take. Yeah, perfect. So make no mistake, what we were seeing is not a deterioration in competitiveness, but a clear allocation of sales cycle. 2024 was a record year for bookings. In 2025, we signed fewer new contracts. That's a fact, and RFP processes are taking longer to close. So enterprise customers are simply taking more time to make platform decisions due to macro scenarios and uncertainty of AI future.

The primary driver is what we call the AI wait and see effect. There is an enormous amount of discussions around how AI will reshape software. When companies are making a 5 to 10 years infrastructure decision with high switching costs, they want clarity. So decisions are being delayed, sales cycles are being elongated.

Importantly to mention is that our win rates remain stable, our churns remain in the mid-single digits, and it's stable. And this is, in my opinion, a market-wide [exitation], not a VTEX-specific issue.

In response -- we streamline our sales and marketing organization to operate more efficient, leveraging all the new AI paradigm and capabilities. The productivity gains. are being redirected into R&D, accelerating our AI roadmap and positioning VTEX as an AI-first native platform for commerce enterprise companies.

So yes, momentum is lower and cycles are longer, but fundamentals remain strong. So [Dren]?

Perfect. Thanks, Mariano. Leveya, on the second question on gross margin, as we mentioned in the prepared remarks, we gained roughly 3 percentage points in subscription gross margin this quarter from 78.8% to 81.8%, and this is basically all AI-driven.

So just to recap, over the past three years, we gained a lot of subscription gross margin. Over the past or the first two years in this three-year period was mostly driven by hosting optimizations and gains over the last one year, so during 2025, it was driven on the support function of our existing customers. And by automating the support using AI tools, we have managed to gain 3 percentage points in margin, and this is sustainable going forward as well.

Perfect, very clear. Thank you.

Lucca Brendim, Bank of America.

Hi, everyone. Thank you for taking my questions. I have two on my side here. The first one, if you could comment a little bit on what you think are the main risks and also the main opportunities of AI that you see for the company, both in the short term but also in the long term, and how do you think this both sides will pan out in the long run?

And also second, if you could comment a little bit on capital allocation you guys announced. The new buyback program, which is very robust. So how can we think about what the tax plans to do with the cash generation that will be coming in the next years? Thank you.

So thank you very much for the question. I'm Geraldo. I'll answer that.

So first of all, AI is not a feature upgrade. It's a structural shift comparable to the move to the cloud that we did a decade ago and make this viable as a company. Our role in this transition is very clear to be the mission-critical orchestration layer of AI-driven commerce.

AI is lowering the cost of writing code. Everybody's talking about it, but it's raising the bar for security, integration, and reliability.

Global enterprise, they don't buy lines of code. They buy future-driven domain knowledge packages around security and reliability. They need the backbone that propels them for the future with the (inaudible) security.

As commerce fragments across AI agents, bots, and new interfaces, the front-end becomes increasingly commoditized. But every transaction still needs a centralized system of records to validate inventory, manage price, and trigger fulfillment. That orchestration layer, the single source of tool is where VTEX operate. We have a cloud-native multi-tenant architecture that gives us access to billions of real-world commerce data points across a lot of verticals.

That deterministic data is a strategic asset for training proprietary models, certain silos that are on legacy platforms that they cannot replicate. In our own operations like so today, I'm going to talk about this already, we've seen a lot of tangible impact.

So I would say, look at that -- the risk is that for us and for any other software company is that we don't embrace and adopt the revolution the technological revolution. But if we do, a software company that goes to plus these technological shifts, they will be stronger, not be weaker. And we are working very hard to get there with the stress that we already got from a lot of years from now, which is the credibility, the security, the customer base, the proprietary data. I think there's a lot of room for us to use and leverage data revolution.

Perfect. And on the capital allocation, Lucca, so our capital allocation is guided by a simple principle. We prioritize long-term value creation while maintaining the flexibility to navigate a dynamic macroenvironment. So we are operating from a position of significant financial strength.

As our year-end 2025, we held roughly $200 million in cash. So this robust position, combined with our consistent free cash flow generation, allow us to announce a new $50 million 12-month share repurchase program that I just mentioned. So we view buybacks as a disciplined tool to optimize our capital structure, and importantly, to mitigate dilution from our share-based compensation program.

While organic growth remains our primary focus, and we talked a lot in the prepared remarks about how we plan to reaccelerate the organic growth, and we are investing more in R&D to boost our AI transformation and strengthen our main key growth pillars.

We are also strategically active in the M&A market. More recently, our approach has been about acquiring capabilities that accelerate our product roadmap to enhance the platform differentiation. So you've seen this recently with the Weni acquisition, which has strengthened our agentic CX product and Newtail, which accelerated our retail media capabilities.

So our capital allocation remains anchor in discipline, ROI, and long-term view for the shareholders.

Very clear. Thank you for the answers.

Rafael Oliveira, UBS.

Hi everyone, thanks for taking my questions. I got two questions here on my side. So first I want to start here by asking what are the main drivers that could drive revenue growth back to double digits in the next few years? If you could disclose any regional breakdown on the current macro backdrop would be very helpful.

And the second question would be, how is the B2B pipeline evolving, both in terms of size and quality? And again, any color on the global expansion of B2B will be very helpful. Thank you.

Good, I'll get that. So to address the path forward, like we know, as I said in the first remarks, we're not satisfied, and we think that we have a lot of more bandwidth to deal with more complex problems to re-accelerate the country, initiate other to start other initiatives that will make the company accelerate and go back to the growth we were used to.

So first of all, we need to distinguish between what is cyclical and what is structural, while our Q4 of 2025 subscription revenue growth of 5.4% affection to reflect a cyclical slowdown, mostly driven by Microsoft in Brazil and Argentina, and also an unusually promotional marketplace environment. Our structural foundations have never been stronger, in my opinion.

We have deliberately evolved the text into a multi-product company, AI-driven commerce platform, and we're now seeing double-digit growth momentum across four levels that will our next phase. And I'll try to give some pictures on these four levels.

So first of all is the global expansion. Our markets in the US and Europe delivered 22% subscription revenue growth in 2025. These operations are now approaching breakeven contribution margins and are becoming largely self-funded.

Second is B2B commerce, this is a natural extension of our platform that effectively doubles our addressable market in our opinion. Roughly half of our new deals in the US and EMEA are now B2B-related, as enterprise migrates from outdated 20-year-old legacy systems to a modern architecture.

The third one is retail media. We moved from a pilot to a core engine this year by enabling retailers to monetize the digital traffic, capturing ad revenue that represents 3% to 8% of GMV for marketplaces. We're creating a high-margin, attractive revenue streams for our customers and for the techs.

The fourth one, and you know, we see AI-first approach. AI is already delivering measurable outcomes, such as the 2% point expansion on the gross margin that we talked about. But we're also reinvest these productivity gains back into R&D to lead the transition to our AI workspace and vision products that can be transformational to our customers.

For the full year of 2026, as comps ease throughout the year, we anticipate a trajectory of gradual acceleration, with the expectation that we will exit the year at a faster pace than we entered. While we recognize there are external factors that we do not control, such as the interest-rate cycles, the consumption cadence, the broader market volatility, we believe we have the right tools to help our customers reaccelerate the same-store sales and reinvigorate our own sales funnel.

So we're staying the course, executing with discipline and positioning the (inaudible) detectable for the next year of connected commerce. All of that while delivering records with profitability, as you noticed.

Okay, about the B2B. Can you, if I am not answering correctly, but can you please repeat the B2B question if I misunderstand?

But just an overall perspective on B2B, VTEX is a company that has three products and multiple solutions. The products are commerce platform, retail media platform, and agentic CX platform. And we do support, with those three products, multiple solutions. Omnichannel B2C, B2B commerce, advertising, retail media for advertisers, retail media for publishers.

About B2B, we are seeing that B2B is getting traction, something that we call in acceleration phase. Each in deploys and pipeline generation. Our commerce platform product delivers multiple solutions specializing B2B showing great momentum. So in fact, something that we can share is roughly half of our deals in the US and AMEA are now B2B related. So that effectively doubles our addressable market within the enterprise tier.

If I didn't answer what you wanted about B2B, please let me know.

No, it was super clear. I was just asking about how the B2B pipeline is evolving, but thanks for the color. If I may do just a follow up here on the AI team. How are you guys seeing the development of these new AI tools from the large tech or LLM providers? Are you guys seeing some competitive pressure? And if you guys could comment about agentic commerce and how this should be maybe beneficial for the [D2C] platforms?

I think every one of us are very impressed with the velocity of this resolution and eventually are getting to conclusions that are maybe faster than we should have.

I see that this AI company, they're very powerful. They're doing a lot of nice work and a lot of aggregated value, but they're also enabling companies like us to deliver even better software.

Just like the cloud revolution, they are enabling us to build much better software. And if we embrace that technology, if we embrace the APIs that they provide to us, I believe that companies like us can provide to the retailers and brands and manufacturers a better solution than they could do it alone.

Why? Because these are high-risk workflows. These are problems that are difficult to articulate. These are problems that requires more than building software. This requires credibility, as I said, security, compliance, trust. And I believe we're better positioned as a domain application to provide the solution to our customers than the generic ones.

This was always true, we always believed that in every revolution when open-source code arise. We believed that when everybody thought open source code would dominate the world and we're here selling software, selling subscription, when the cloud revolution came, everybody thought that people would internalize their software because now it's so easy to deploy a server and software industry the energy tech is much bigger because of the (inaudible) revolution, not despite of that. And now, I believe that the AI revolution will give us even more strength to deliver even more value to our customers.

And just adding up on Geraldo's comments here, if the question on other lens were about the kind of the monopoly on traffic control that can generate, the way we see the world of traffic, we used to be controlled by Meta, Google, and few marketplaces. And now with a new entrance, like Chinese brands becomes a huge traffic controllers, OpenAI with the LLM, like cracking the code of become a huge aggregator. Actually, we are seeing more fragmentation on the traffic industry.

So when the traffic layers fragments, the backbone for a multi-channel operation increases value. WhatsApp being locked down, for example, is a huge traffic originator. So the world is evolving on creating more channels and not more consolidation of channels. This is -- we see as a foundation for strengthening the positioning of anyone in the backbone for commerce market as we are.

We talk about that in our founders' letter on this earnings annual report. I think it's worth it to take a look on our perspective on how this revolution affects us and the market in general.

Okay. Thank you so much. I will take a look on that. Thanks.

Maddie Schrage, KeyBanc Capital Markets.

Hey, guys. Thanks for taking the question. Obviously, you guys called out some macro headwinds, but also we're emphasizing global expansion as a key growth lever. So how are you thinking about the pace and prioritization of geographic investments?

And then, in particular, as you guys move faster internationally, what do you think is the biggest factor in terms of gaining traction? Was it brand awareness, maybe partnerships, or product localization? Is there something we should call out?

Perfect. I can give some color, and Geraldo can give as well.

We cannot avoid to understand that a company that will leverage the most of the AI revolution is the company that can group competences under org charts.

So recently, precisely in December, we changed a lot of our regional approaches by having same competences of people below different managers in many regions in the world, countries, and regions. We understood that we need to bring them more in a specialization like functional oriented org chart.

So we announced a degree of work on the growth structure, where now a majority of the sales and marketing organizations are oriented by functions. And with that, we can leverage the most of the AI agentic revolution. The agents are unified by knowledge.

What we are seeing detects reach the level of brand by being recognized on Gartner for two years consecutive as the customer choice in the Gartner Voice. The brand of VTEX now was able to produce clients in all the regions.

And now with the global-oriented by function org-sharp, we can deliver through our ecosystem services and solutions among any kind of a regional definition. We believe the company that will crack the code on really uses AI in favor of operational gains will be the ones with a global redness by joining a human plus agent's labor. And so the regional approach lost importance for us.

This doesn't mean that the regional localization, it is less. It's quite the opposite. We reduce it, our solution architect layer of FTEs, increasing the trust we do have in our ecosystem. That's a sign of the maturity of our ecosystem in the world.

We are delivering global projects in Abu Dhabi, in Asia, in EMEA, in Africa, in North America, in LatAm, and now we are doing this through the ecosystem. That is a transitioning coming from the last five years. So we are not seeing any more the go-to-market of VTEX heavily or kind of exclusively based on regions. Now we are defining our scope to the world that is three products: commerce platform, retail media platform, and agentic CX platform with multiple solutions. The two of the biggest solutions are B2B commerce and omnichannel B2C.

Super helpful. And if I could just ask one follow-up. In your conversations with CIOs and digital leaders, how often are you guys talking about discoverability in the age of agentic commerce and conversion?

AI agentic, it is a kind of a top-notch topic in any RFP today, right? What VTEX is really focused is to deliver the value aggregation of the disruption in technology. To talk about the technology itself doesn't aggregate outcomes to our customers. But with the agentic CX platform of VTEX, we have already deployed clients that have saved 80% in the customer service costs.

This is AI for us. AI is a medium to deliver the outcome that our clients need. And our clients all over the world, they trust us to future-proof them in terms of AI.

So the AI bet of VTEX is pretty big. It's all across all our products and solutions. But the one that I would say that is delivering the most results, it is our solution of agentic customer service based in our product of agentic CX platform.

Very helpful. Thank you, guys, very much.

There's no further questions at this time. I will now turn the call back over to Geraldo Thomaz for closing remarks. Geraldo?

Before we conclude, I want to step back once more and reflect on where VTEX stands today. 2025 tested the market, our customers, and our industry, but it also reaffirmed the strength of our foundation. We navigated a challenging environment to deliver record profitability while deepening our relevance with enterprise customers.

Crucially, we did this while increasing our investment in R&D to accelerate our AI transformation. As we look ahead, our focus is on execution. As discussed, we remain focused on our four growth level: global expansion, B2B, retail media, and AI. We believe VTEX is structurally aligned with where enterprise commerce is going. And that alignment position us to improve growth over time as this initiative's scale.

Finally, I want to thank you employees, customers, partners, and investors for their continued trust. VTEX has been built over decades by navigating moments of transitions just like this one. Our history shows that our willingness to adapt early and invest with discipline creates durable value over time.

We enter the next chapter with clarity, resiliency, and confidence in our ability to deliver long-term growth and profitability.

Thank you for joining us today, and we look forward to update you in our progress in the quarters ahead.

That concludes today's call. You may now disconnect.