SPS Commerce (NASDAQ:SPSC) Releases Quarterly Earnings Results, Beats Estimates By $0.16 EPS

SPS Commerce (NASDAQ:SPSC) released its earnings results on Thursday. The software maker reported $1.39 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.23 by $0.16, FiscalAI reports. SPS Commerce had a return on equity of 13.63% and a net margin of 10.65%. The business had revenue of $197.65 million for the quarter, compared to the consensus estimate of $197.51 million. During the same quarter in the previous year, the business earned $1.13 earnings per share. SPS Commerce’s quarterly revenue was up 4.1% on a year-over-year basis.

Here are the key takeaways from SPS Commerce’s conference call:

• Core business momentum exceeded expectations: Q3 revenue reached $197.6 million, while adjusted EBITDA rose 17% to $70.9 million, expanding the margin to 36%. Excluding the divested business and Amazon take-rate effects, underlying Q4 growth is expected at 8%–9%.
• SPS is accelerating its agentic AI strategy, making MAX broadly available to Fulfillment customers and developing paid MAX Agents for 2027. Management cited customer benefits including avoided chargebacks, faster invoice resolution, and potentially millions of dollars in delayed-receivables prevention.
• Operating leverage and automation are improving profitability. Gross margin increased to 73%, while agent-assisted onboarding is shortening implementation timelines and is expected to provide additional margin expansion over the next 12–18 months.
• Amazon policy changes affecting short shipments and dispute processes reduced Revenue Recovery yields and prompted the company to lower its outlook; management said most of the guidance impact came from these changes, with a smaller portion from customers shifting from take-rate to subscription contracts.
• The company continues to see strong demand from retailer enablement programs and expects growth to increasingly come from higher average revenue per customer through additional trading connections, Analytics, Revenue Recovery, and future AI offerings. SPS also repurchased $48.8 million of its shares in Q3, deploying 84% of quarterly free cash flow.

SPS Commerce Price Performance

NASDAQ SPSC traded down $2.79 during trading on Friday, reaching $82.99. 659,136 shares of the company’s stock were exchanged, compared to its average volume of 514,461. The business has a 50 day moving average price of $83.38 and a 200-day moving average price of $68.41. The stock has a market capitalization of $2.99 billion, a P/E ratio of 36.88 and a beta of 0.62. SPS Commerce has a fifty-two week low of $49.04 and a fifty-two week high of $96.54.

Wall Street Analysts Forecast Growth

A number of research analysts have weighed in on the company. Wall Street Zen upgraded SPS Commerce from a “hold” rating to a “buy” rating in a research note on Sunday, October 25th. DA Davidson upped their price objective on SPS Commerce from $65.00 to $70.00 and gave the stock a “neutral” rating in a research note on Friday. Cantor Fitzgerald reissued a “neutral” rating and issued a $70.00 price objective (up from $60.00) on shares of SPS Commerce in a report on Friday, July 31st. Zacks Research raised shares of SPS Commerce from a “strong sell” rating to a “hold” rating in a research note on Monday, July 20th. Finally, Needham & Company LLC reissued a “buy” rating and issued a $100.00 target price (up from $75.00) on shares of SPS Commerce in a research note on Wednesday, August 19th. Two investment analysts have rated the stock with a Buy rating, seven have assigned a Hold rating and one has assigned a Sell rating to the company’s stock. Based on data from MarketBeat, SPS Commerce has an average rating of “Hold” and an average price target of $79.33.

Key Stories Impacting SPS Commerce

Here are the key news stories impacting SPS Commerce this week:

• Positive Sentiment: Q3 earnings exceeded expectations. SPS Commerce reported adjusted EPS of $1.39, above the $1.23 consensus estimate and up from $1.13 a year earlier. Revenue of $197.6 million was broadly in line with estimates and increased 4% year over year. SPS Commerce Q3 Earnings and Revenues Beat Estimates
• Positive Sentiment: Profitability and shareholder returns improved. Adjusted EBITDA rose 17% to $70.9 million, while SPS Commerce repurchased $48.8 million of stock during the quarter. GAAP net income also increased to $30.7 million from $25.6 million in the prior-year period. SPS Commerce Reports Strong Third Quarter 2026 Financial Results
• Neutral Sentiment: Management maintained a measured outlook. SPS Commerce guided fourth-quarter revenue to $199.3 million-$201.3 million and GAAP EPS to $0.74-$0.79. Full-year 2026 revenue guidance is $786.9 million-$788.9 million, with GAAP EPS of $2.29-$2.35. Revenue growth was partially constrained by the divestiture of the 3P Revenue Recovery business and variability in the 1P take-rate model. SPS Commerce Provides Earnings Guidance
• Negative Sentiment: DA Davidson remains cautious despite raising its target. The firm lifted its price target from $65 to $70 but kept a neutral rating, leaving the target below the stock’s recent trading level. That implies analysts see limited near-term upside after the recent rally and may be contributing to selling pressure. DA Davidson SPS Commerce Rating

About SPS Commerce

SPS Commerce, Inc provides cloud-based supply chain management software for retailers, suppliers, distributors and logistics providers. Its platform helps businesses manage and automate transactions and workflows across complex retail and e-commerce networks.

The company’s solutions include electronic data interchange (EDI), order management, inventory visibility, fulfillment, invoice and payment processing, product information management, and supply chain analytics. These tools are designed to connect trading partners, reduce manual data entry, improve order accuracy and support more efficient movement of products from suppliers to consumers.

Founded in 2001 and headquartered in Minneapolis, Minnesota, SPS Commerce serves businesses across retail and wholesale ecosystems in North America and other international markets.