This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties. The statements contained in this Quarterly Report on Form 10-Q that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Without limiting the foregoing, the words "may," "will," "should," "could," "expects," "plans," "intends," "anticipates," "believes," "estimates," "predicts," "potential," "continue," "target," "seek" and similar expressions are intended to identify forward-looking statements. All forward-looking statements included in this Quarterly Report on Form 10-Q are based on information available to us up to, and including the date of this document, and we disclaim any obligation to update any such forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain important factors, including those set forth in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors" and elsewhere in this Quarterly Report on Form 10-Q. You should carefully review those factors and also carefully review the risks outlined in other documents that we file from time to time with the United States Securities and Exchange Commission.

Executive Overview

In the quarter ended September 30, 2009, we reported 27% revenue growth over the same quarter in 2008 to revenue of $145.1 million, and 61% diluted earnings per share ("EPS") growth over the same quarter in 2008 to EPS of $0.29.

Our long-term goal is to continue to grow profitably and become the leading online provider of small business marketing solutions. We believe that the strength of our solution gives us the opportunity not only to capture an increasing share of the existing printing needs in our targeted markets, but also to address marketing services demand by making available to our customers cost-effective solutions to grow their businesses. In order to accomplish this objective, we intend to execute on the following:

Provide "All Things Marketing" for Small Businesses

We believe our customers currently spend only a small portion of their annual budget for marketing products and services with us. By expanding the scope of our services and by improving the quality and selection of our products and services along with the customer experience, we intend to increase the amount of money our customers spend with us each year. During the first quarter of fiscal year 2010, we added personalized notebooks, mugs, and other offerings. We plan to continue to expand and enhance our product and service offerings in order to provide a greater selection to our existing customers and to attract customers seeking a variety of products and services. Additionally, by continuing to improve our customer acquisition and retention marketing programs, our customer support and design services, and our value proposition, we seek to increase the number of products purchased by each customer.

Expand Geographic Reach

For the three months ended September 30, 2009, revenue generated from non-United States websites accounted for approximately 41% of our total revenue. We believe that we have significant opportunity to expand our revenue both in the countries we currently service and in additional countries worldwide. We opened a European marketing office in Barcelona, Spain in January 2007 to focus on the implementation of our European growth initiatives. We currently serve Australia, New Zealand and Japan from our North American and European locations, but have announced plans to open production and marketing facilities in Australia. We intend to continue geographic expansion of our marketing efforts and customer service capabilities. In addition, we intend to further extend our geographic and international scope by continuing to introduce localized websites in different countries and languages and by offering graphic design content specific to local markets.

Home & Family

Although we expect to maintain our primary focus on the small business market, we believe that our customer support, sales and design services, and low production costs are differentiating factors that make purchasing from us an attractive alternative for individual consumers. We intend to add new products and services targeted at the consumer market, and we believe that the economies of scale provided by our large print order volumes and integrated design and production facilities will enable us to profitably grow our consumer business. During the first quarter of fiscal year 2010, we added personalized notebooks, mugs, photo flip books and photo books to our list of offerings that appeal to consumers.

Recent Developments

On August 31, 2009, we effected the Change of Domicile, pursuant to which we effectively moved the place of incorporation of the publicly traded parent entity of the Vistaprint group of companies from Bermuda to the Netherlands. Pursuant to the Change of Domicile, the common shareholders of Vistaprint Limited became ordinary shareholders of Vistaprint N.V. and Vistaprint Limited became a wholly owned subsidiary of Vistaprint N.V, and Vistaprint N.V. assumed Vistaprint Limited's existing obligations in connection with awards granted under Vistaprint Limited's incentive plans and other similar employee awards.

On July 1, 2009, Robert Keane, our chief executive officer, relocated to a new office in Paris, France, which will operate as Vistaprint SARL under the French headquarters regime (quartiers généraux) tax regime. Other activities that will be located in our Paris headquarters include corporate strategy, talent development and corporate communications.

The Change of Domicile and the establishment of our Paris headquarters did not have and are not anticipated to have a material impact on how we conduct our day-to-day operations, consolidated effective tax rate or our financial position, results of operations or cash flows.

Results of Operations

The following table presents our historical operating results for the periods
indicated as a percentage of revenue:



                                                      Three Months Ended
                                                        September 30,
                                                     2009           2008
       Consolidated Statement of Operations Data:
       As a percentage of revenue:
       Revenue                                        100.0 %        100.0 %
       Cost of revenue                                 36.4 %         39.3 %
       Technology and development expense              12.2 %         12.1 %
       Marketing and selling expense                   32.1 %         30.4 %
       General and administrative expense               9.4 %          9.6 %

       Income from operations                           9.9 %          8.6 %
       Interest income                                  0.1 %          0.5 %
       Other income (expense), net                      0.1 %         (0.8 )%
       Interest expense                                 0.3 %          0.3 %

       Income before income taxes                       9.8 %          8.0 %
       Income tax provision                             0.9 %          0.8 %

       Net income                                       8.9 %          7.2 %

Comparison of the Three Month Periods Ended September 30, 2009 and 2008



                                     Three Months Ended September 30,
                                                                2009-2008
                                    2009           2008         % Change
               Revenue           $  145,091      $ 114,232           27.0 %
               Cost of revenue   $   52,865      $  44,844           17.9 %
               % of revenue            36.4 %         39.3 %

Revenue. We generate revenue primarily from the sale and shipment of customized manufactured products, as well as certain digital services, such as website hosting and graphic design services. We also generate revenue from order referral fees, revenue share and other fees paid to us by merchants for customer click-throughs, distribution of third-party promotional materials and referrals arising from products and services of the merchants we offer to our customers on our website. Unlike products that we manufacture ourselves, these third-party referral offerings do not require physical production by us and have minimal corresponding direct cost of revenue. For the quarters ended September 30, 2009 and 2008, we generated approximately $5.1 million and $7.0 million, respectively, of our revenue from these third-party referral fees. By the quarter ending December 31, 2010, we expect that referral fee revenue from all sources will account for between 2% and 4% of our total quarterly revenues. Of that amount, we expect

that quarterly referral fee revenue from membership discount programs will decline in absolute dollar terms, including possibly to as low as zero. Referral fee revenue from membership discount programs for the quarters ended September 30, 2009 and 2008 was approximately 2.3% and 5.1% of our total revenues, respectively.

To understand our revenue trends, we monitor several key metrics, including:

• Website sessions. A session is measured each time a computer user visits a Vistaprint website from their Internet browser. We measure this data to understand the volume and source of traffic to our websites. Typically, we use various advertising campaigns to increase the number and quality of shoppers entering our websites. The number of website sessions varies from month to month depending on variables such as product campaigns and advertising channels used.

• Conversion rates. The conversion rate is the number of customer orders divided by the total number of sessions during a specific period of time. Typically, we strive to increase conversion rates of customers entering our websites in order to increase the number of customer orders generated. Conversion rates have fluctuated in the past and we anticipate that they will fluctuate in the future due to, among other factors, the type of advertising campaigns and marketing channels used.

• Average order value. Average order value is total bookings for a given period of time divided by the total number of customer orders recorded during that same period of time. We seek to increase average order value as a means of increasing total revenue. Average order values have fluctuated in the past and we anticipate that they will fluctuate in the future depending upon the type of products promoted during a period and promotional discounts offered. For example, among other things, seasonal product offerings, such as holiday cards, can cause changes in average order values.

We believe the analysis of these metrics provides us with important information on customer buying behavior, advertising campaign effectiveness and the resulting impact on overall revenue trends and profitability. While we continually seek and test ways to increase revenue, we also attempt to increase the number of customer acquisitions and to grow profits. As a result, fluctuations in these metrics are usual and expected. Because changes in any one of these metrics may be offset by changes in another metric, no single factor is determinative of our revenue and profitability trends and we assess them together to understand their overall impact on revenue and profitability.

Total revenue for the three months ended September 30, 2009 increased 27% to $145.1 million from the three months ended September 30, 2008, due to increases in sales across our product and service offerings, as well as across all geographies. The overall growth during this period was driven by increases in website sessions, which grew by 39% to 65.1 million. This was partially offset by a 7% decrease in conversion rates to 6.4%. In addition, the stronger U.S. dollar negatively impacted our revenue growth by approximately 4% as compared to the three months ended September 30, 2008. Our average order value remained consistent at approximately $34.

As our total customer base has grown, we also have continued to experience growth in purchases from existing customers. Bookings from repeat customers accounted for 67% of total bookings for the three months ended September 30, 2009 as compared to 66% of total bookings for the three months ended September 30, 2008. Revenue from our non-United States websites accounted for 41% of total revenues for the three months ended September 30, 2009 as compared to 38% of total revenues for the three months ended September 30, 2008.

Cost of revenue

Cost of revenue includes materials used to manufacture our products, payroll and related expenses for production personnel, depreciation of equipment used in the production process and in support of digital service offerings, shipping and postage costs, and other miscellaneous related costs of products sold by us.

The increase in cost of revenue for the three months ended September 30, 2009 compared to the three months ended September 30, 2008 was primarily attributable to the production costs associated with the increased volume of shipments of products during this period. The decrease in the cost of revenue as a percentage of total revenue for three months ended September 30, 2009 compared to the three months ended September 30, 2008 was primarily driven by reductions in shipping costs, improved pricing agreements in relation to purchases of materials and a weaker Canadian dollar, which positively impacted the raw material and labor costs of our Canadian production operations, and productivity improvements at our manufacturing locations. In addition, shifts in product mix, including an increase in sales of digital services, partially offset by a decrease in referral revenue, contributed to a decrease in cost of revenue as a percentage of sales.

                                              Three Months Ended September 30,
                                                                         2009-2008
                                             2009            2008        % Change
     Technology and development expense   $   17,672       $ 13,808           28.0 %
     % of revenue                               12.2 %         12.1 %
     Marketing and selling expense        $   46,533       $ 34,801           33.7 %
     % of revenue                               32.1 %         30.4 %
     General and administrative expense   $   13,615       $ 10,948           24.4 %
     % of revenue                                9.4 %          9.6 %

Technology and development expense

Technology and development expense consists primarily of payroll and related expenses for software and manufacturing engineering, content development, amortization of capitalized software and website development costs, information technology operations, website hosting, equipment depreciation, patent amortization and miscellaneous technology infrastructure-related costs. However, depreciation expense for information technology equipment that directly supports the delivery of our digital services products is not included in this category as this depreciation expense is included in our cost of revenue.

The increase in our technology and development expenses of $3.9 million for the three months ended September 30, 2009 as compared to the same period in 2008 was primarily due to increased payroll and benefit costs of $2.4 million associated with increased employee hiring in our technology development and information technology support organizations. At September 30, 2009, we employed 314 employees in these organizations compared to 282 employees at September 30, 2008. In addition, to support our continued revenue growth during this period, we continued to invest in our website infrastructure, which resulted in increased depreciation and hosting services of $0.7 million and increased other expenses of $0.6 million for the three months ended September 30, 2009 as compared to the same period in 2008.

Marketing and selling expense

Marketing and selling expense consists primarily of advertising and promotional costs; payroll and related expenses for our employees engaged in sales, marketing, customer support and public relations activities; and third party payment processor and credit card fees.

The increase in our marketing and selling expenses of $11.7 million for the three months ended September 30, 2009 as compared to the same period in 2008 was driven primarily by increases of $8.7 million in advertising costs related to new customer acquisition and costs of promotions targeted at our existing customer base, increases in payroll and benefits related costs of $2.3 million. During this period, we continued to expand our marketing organization and our design, sales and services center. At September 30, 2009, we employed 695 employees in these organizations compared to 631 employees at September 30, 2008. In addition, payment processing fees paid to third-parties increased by $0.7 million during the three months ended September 30, 2009 as compared to the same period in 2008 due to increased order volumes.

General and administrative expense

General and administrative expense consists primarily of general corporate costs, including third party professional fees and payroll and related expense of employees involved in finance, accounting, human resource and general executive management. Third party professional fees include accounting, legal, recruiting, insurance and organizational consulting service fees.

The increase in our general and administrative expenses of $2.7 million for the three months ended September 30, 2009 as compared to the same period in 2008 was primarily due to increased payroll and benefit costs of $1.1 million resulting from the continued growth of our executive management, finance and human resource organizations, and increased third-party professional fees of $1.8 million related to ongoing litigation, the execution of our Change of Domicile and other general and administrative activities. These increases were offset by decreased share-based compensation costs of $0.5 million resulting from a share-based payment charge related to a departing employee in the prior-year period. At September 30, 2009, we employed 156 employees in these organizations compared to 142 employees at September 30, 2008.

Interest income

Interest income, which consists of interest income earned on cash and cash equivalents, decreased $0.6 million to $0.1 million for the three months ended September 30, 2009 from $0.7 million generated in the same period in 2008. The decrease was primarily due to lower interest rate yields on our investments.

Other income (expense), net

Other income (expense), net, which primarily consists of gains and losses from currency exchange transactions, changed to $0.2 million of income for the three months ended September 30, 2009 as compared to $0.9 million of expense for the same period in 2008. The change was driven by the weakening of the U.S. dollar.

Interest expense

Interest expense, which consists of interest and other related fees paid to financial institutions on outstanding balances on our credit facilities, was approximately $0.4 million for the three months ended September 30, 2009 and 2008, respectively. As a result of our early repayment of $5.9 million of our debt, we incurred $0.1 million in prepayment penalties. We expect that interest expense will decline in future periods as a result of our early repayment of debt.

Income tax provision

                                            Three Months Ended
                                               September 30,
                                             2009           2008
                   Income taxes:
                   Income tax provision   $    1,365       $  965
                   Effective tax rate            9.5 %       10.4 %

For the three months ended September 30, 2009 and 2008, our tax expense primarily consisted of tax provisions for our global operating subsidiaries in taxable jurisdictions. The taxable income from these operating subsidiaries is a function of their level of costs incurred and charged to other entities in the Vistaprint group of companies under transfer pricing agreements. The resulting tax liability in each jurisdiction is incurred regardless of whether the consolidated group is profitable. The decrease in the effective tax rate in the three months ended September 30, 2009 compared to the three months ended September 30, 2008 is primarily due to a geographic shift in profits, resulting in increased profits residing in jurisdictions with lower tax rates.