SPS Commerce (SPSC) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue grew 6% year-over-year to $192.1 million, with recurring revenue up 7% and fulfillment growth of 8%.

• Net income for Q1 2026 was $19.7 million ($0.53 per diluted share), down 11% from $22.2 million ($0.58) in Q1 2025, reflecting higher operating expenses and increased stock-based compensation.

• Adjusted EBITDA rose to $57.9 million, maintaining a 30% margin, and non-GAAP diluted EPS increased to $1.10.

• AI-driven solutions, notably the MAX agent, are delivering operational efficiencies and value for customers, with 400+ beta users and positive feedback.

• Cross-selling momentum is strong, especially among 1P customers, and integration of products is unlocking incremental growth.

Financial highlights

• Recurring revenues grew 7% to $184.5 million, representing 96% of total revenue, with ~54,200 recurring revenue customers.

• Gross profit increased 7% to $132.9 million, maintaining a 69% gross margin.

• Adjusted EBITDA: $57.9 million; cash and cash equivalents: $154.3 million at quarter end.

• Net cash provided by operating activities was $55.6 million, up from $40.0 million in Q1 2025.

• Nearly 100% of free cash flow used to repurchase $47.1 million in shares in Q1.

Outlook and guidance

• Q2 2026 revenue expected at $194.5–$196.5 million (+4–5% YoY); Adjusted EBITDA: $60.9–$62.4 million.

• Q2 fully diluted EPS: $0.53–$0.56; non-GAAP diluted EPS: $1.06–$1.09.

• FY 2026 revenue guidance: $796–$802 million (+6–7% YoY); Adjusted EBITDA: $262.8–$267.3 million (+14–16% YoY).

• FY 2026 fully diluted EPS: $2.66–$2.69; non-GAAP diluted EPS: $4.73–$4.76.

• Cash, cash equivalents, and operating cash flows are expected to be sufficient for at least the next twelve months.