SPS Commerce (NASDAQ:SPSC) Announces Quarterly Earnings Results, Beats Expectations By $0.18 EPS

SPS Commerce (NASDAQ:SPSC) issued its quarterly earnings data on Thursday. The software maker reported $1.27 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.09 by $0.18, FiscalAI reports. The firm had revenue of $197.81 million for the quarter, compared to analyst estimates of $195.46 million. SPS Commerce had a net margin of 10.10% and a return on equity of 12.95%. SPS Commerce’s revenue was up 5.6% on a year-over-year basis. During the same period in the previous year, the firm earned $1.00 EPS. SPS Commerce updated its Q3 2026 guidance to 1.200-1.230 EPS and its FY 2026 guidance to 4.840-4.930 EPS.

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

• Core business growth remained healthy: Q2 revenue rose 6% year over year to $197.8 million, while management said the business excluding the divested 3P Revenue Recovery unit grew at a high-single-digit rate, supported by upsell, cross-sell, and improving gross retention.
• SPS reported strong profitability and cash generation, with adjusted EBITDA of $66.6 million and trailing 12-month free cash flow of $198.7 million, up 40% year over year. The company used $51.2 million of quarterly free cash flow to repurchase shares.
• The company sold its 3P Revenue Recovery business for $9.5 million in cash and recorded a $23.5 million loss on the sale. Management said the divestiture removes a lower-overlap Amazon Marketplace business and sharpens focus on 1P suppliers, but it reduces second-half 2026 revenue by approximately $10.5 million.
• SPS is expanding its AI strategy through MAX, which is detecting supply-chain issues and delivering measurable customer savings. MAX is expected to become generally available to Fulfillment customers by the end of summer, with paid autonomous-agent bundles targeted for launch by late Q4 2026.
• Full-year 2026 guidance calls for revenue of $788.4 million to $793.4 million and adjusted EBITDA of $264.6 million to $269.1 million, implying roughly 34% adjusted EBITDA margin and about 300 basis points of margin expansion. Management expects core revenue growth in the high-single digits, although total customer counts are projected to be flat to slightly positive.

SPS Commerce Price Performance

Shares of SPSC stock traded up $7.56 during trading on Friday, reaching $73.39. The company’s stock had a trading volume of 1,414,673 shares, compared to its average volume of 498,369. SPS Commerce has a 1-year low of $49.04 and a 1-year high of $124.08. The stock’s 50-day moving average price is $58.92 and its 200 day moving average price is $62.35. The company has a market capitalization of $2.69 billion, a price-to-earnings ratio of 35.45 and a beta of 0.56.

Key Stories Impacting SPS Commerce

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

• Positive Sentiment: Second-quarter results exceeded estimates. SPS Commerce reported adjusted EPS of $1.27, ahead of the $1.08 consensus, while revenue rose 5.6% year over year to approximately $197.8 million, above expectations of $195.5 million. Adjusted EBITDA increased 19% to $66.6 million. SPS Commerce Q2 Earnings and Revenues Beat Estimates
• Positive Sentiment: Full-year EPS guidance was raised relative to consensus. SPS Commerce issued 2026 adjusted EPS guidance of $4.84 to $4.93, above the $4.46 analyst consensus. The company also repurchased $51.2 million of stock during the quarter. SPS Commerce Reports Strong Second Quarter 2026 Financial Results
• Neutral Sentiment: Third-quarter expectations are mixed. Q3 EPS guidance of $1.20 to $1.23 is above the $1.18 consensus, but revenue guidance of $196.3 million to $198.3 million trails the $202.4 million consensus. The completed divestiture of the 3P Revenue Recovery business is expected to reduce second-half 2026 revenue by about $10.5 million while remaining neutral to adjusted EBITDA.
• Negative Sentiment: Reported net income declined sharply. GAAP net income fell to $6.9 million, or $0.19 per diluted share, from $19.7 million, or $0.52, a year earlier. In addition, recent insider-trading data shows selling but no insider purchases, which may weigh on investor sentiment.

Hedge Funds Weigh In On SPS Commerce

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. NewEdge Advisors LLC increased its position in shares of SPS Commerce by 545.7% during the first quarter. NewEdge Advisors LLC now owns 226 shares of the software maker’s stock worth $30,000 after acquiring an additional 191 shares during the period. Advisory Services Network LLC acquired a new position in SPS Commerce during the 3rd quarter worth $32,000. Global Retirement Partners LLC grew its stake in SPS Commerce by 2,130.0% during the 4th quarter. Global Retirement Partners LLC now owns 446 shares of the software maker’s stock worth $40,000 after purchasing an additional 426 shares in the last quarter. Summit Securities Group LLC purchased a new stake in SPS Commerce during the 4th quarter worth about $45,000. Finally, Danske Bank A S purchased a new stake in SPS Commerce during the 3rd quarter worth about $52,000. Hedge funds and other institutional investors own 98.96% of the company’s stock.

Analyst Ratings Changes

Several equities analysts have recently commented on SPSC shares. Stifel Nicolaus set a $70.00 price objective on shares of SPS Commerce and gave the stock a “hold” rating in a report on Friday. Citigroup reiterated a “buy” rating and issued a $82.00 target price (up from $76.00) on shares of SPS Commerce in a report on Tuesday, July 21st. Morgan Stanley reissued an “underweight” rating and issued a $59.00 target price (up from $57.00) on shares of SPS Commerce in a research report on Friday. Cantor Fitzgerald restated a “neutral” rating and set a $70.00 price target (up from $60.00) on shares of SPS Commerce in a research note on Friday. Finally, Rothschild & Co Redburn set a $60.00 price objective on SPS Commerce and gave the company a “neutral” rating in a research note on Thursday, April 16th. One research analyst has rated the stock with a Strong Buy rating, two have assigned a Buy rating, six have issued a Hold rating and two have given a Sell rating to the stock. Based on data from MarketBeat, the company has a consensus rating of “Hold” and a consensus price target of $74.60.

About SPS Commerce

SPS Commerce, Inc is a leading provider of cloud-based supply chain management solutions that enable seamless collaboration between retailers, suppliers and logistics providers. Through its robust network, SPS Commerce connects trading partners with electronic data interchange (EDI) capabilities, helping businesses automate order processing, inventory management and fulfillment workflows. The company’s platform ensures data accuracy, accelerates order-to-cash cycles and reduces manual intervention, supporting a wide range of industries including retail, grocery, consumer goods and automotive.

The company offers a suite of services encompassing EDI, retail-ready compliance, order management and data analytics.