SPS Commerce (SPSC) investor relations material

Executive summary

• Q3 revenue was $197.647M, up 4% YoY; net income rose 20% to $30.683M and Adjusted EBITDA increased 17% to $70.868M, a 36% margin.

• Agentic AI offerings build on a network of 300,000+ trading relationships and 750M+ annual transactions, with onboarding efficiencies supporting customer value and margin expansion.

• Growth priorities include expanding existing relationships, adding network connections, cross-selling products and serving larger customers.

Financial highlights

• Q3 recurring revenue was $189.0M, up 4% YoY, and represented 96% of revenue; 9M recurring revenue rose 6% to $563.9M.

• Q3 diluted EPS was $0.85 versus $0.67; non-GAAP diluted EPS was $1.39 versus $1.13.

• 9M revenue grew 5% to $587.583M, while net income declined 15% to $57.276M, including a $23.454M loss on the 3P divestiture.

• Q3 adjusted gross margin, excluding stock-based compensation, was 73%, up 170 bps YoY; adjusted S&M, G&A and R&D were 20%, 13% and 7% of revenue, respectively.

• Q3 free cash flow was $58.5M; trailing 12-month free cash flow was $202.6M, up 37% YoY. Cash and short-term investments totaled $183.5M at quarter-end.

Outlook and guidance

• Q4 revenue guidance is $199.3M–$201.3M; excluding Amazon Revenue Recovery take rate and divestiture impacts, expected growth is 8%–9%.

• Q4 Adjusted EBITDA guidance is $72M–$74M; diluted EPS is $0.74–$0.79 and non-GAAP diluted EPS is $1.31–$1.36.

• FY2026 revenue guidance is $786.9M–$788.9M, with underlying growth at high single digits excluding stated impacts; Adjusted EBITDA guidance is $267.4M–$269.4M, a 34% midpoint margin.

• FY2026 non-GAAP diluted EPS guidance is $5.05–$5.11; midpoint Adjusted EBITDA margin expansion is ~330 bps YoY.

• Agentic onboarding is expected to support further margin improvement over the next 12–18 months; an updated Adjusted EBITDA target is planned for the Q4 call.