SPS Commerce (NASDAQ:SPSC) Announces Quarterly Earnings Results

SPS Commerce (NASDAQ:SPSC) issued its quarterly earnings data on Thursday. The software maker reported $1.27 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.08 by $0.19, FiscalAI reports. SPS Commerce had a return on equity of 12.43% and a net margin of 11.92%.The company had revenue of $197.81 million for the quarter, compared to analyst estimates of $195.46 million. During the same quarter last year, the company posted $1.00 earnings per share. The business’s quarterly revenue was up 5.6% compared to the same quarter last year. 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 Trading Down 5.1%

Shares of NASDAQ SPSC traded down $3.57 during midday trading on Thursday, reaching $65.83. 531,203 shares of the company were exchanged, compared to its average volume of 489,606. The stock has a market cap of $2.42 billion, a P/E ratio of 27.43 and a beta of 0.56. SPS Commerce has a 1 year low of $49.04 and a 1 year high of $124.08. The stock has a fifty day simple moving average of $58.53 and a 200 day simple moving average of $62.27.

Institutional Trading of SPS Commerce

Hedge funds have recently added to or reduced their stakes in the stock. UBS Group AG grew its stake in shares of SPS Commerce by 806.1% in the 3rd quarter. UBS Group AG now owns 458,860 shares of the software maker’s stock valued at $47,786,000 after purchasing an additional 408,221 shares during the last quarter. Disciplined Growth Investors Inc. MN raised its stake in shares of SPS Commerce by 86.4% during the third quarter. Disciplined Growth Investors Inc. MN now owns 792,472 shares of the software maker’s stock worth $82,528,000 after purchasing an additional 367,346 shares during the last quarter. Goldman Sachs Group Inc. lifted its holdings in shares of SPS Commerce by 69.1% during the fourth quarter. Goldman Sachs Group Inc. now owns 661,610 shares of the software maker’s stock worth $58,969,000 after purchasing an additional 270,424 shares during the period. Federated Hermes Inc. lifted its holdings in shares of SPS Commerce by 38,429.2% during the fourth quarter. Federated Hermes Inc. now owns 245,046 shares of the software maker’s stock worth $21,841,000 after purchasing an additional 244,410 shares during the period. Finally, Lazard Asset Management LLC grew its position in SPS Commerce by 344.8% in the 3rd quarter. Lazard Asset Management LLC now owns 259,258 shares of the software maker’s stock valued at $26,999,000 after buying an additional 200,978 shares during the last quarter. 98.96% of the stock is owned by institutional investors and hedge funds.

Analyst Upgrades and Downgrades

A number of analysts recently issued reports on SPSC shares. Wall Street Zen cut SPS Commerce from a “buy” rating to a “hold” rating in a research report on Saturday, July 18th. Citigroup reiterated a “buy” rating and issued a $82.00 price objective (up from $76.00) on shares of SPS Commerce in a research note on Tuesday, July 21st. Morgan Stanley downgraded SPS Commerce from an “overweight” rating to an “underweight” rating and decreased their price objective for the company from $70.00 to $57.00 in a report on Tuesday, July 21st. Weiss Ratings lowered shares of SPS Commerce from a “sell (d+)” rating to a “sell (d)” rating in a research report on Thursday, July 23rd. Finally, Zacks Research raised shares of SPS Commerce from a “strong sell” rating to a “hold” rating in a report on Monday, July 20th. One analyst has rated the stock with a Strong Buy rating, two have given a Buy rating, seven have issued a Hold rating and two have issued a Sell rating to the stock. According to data from MarketBeat, the stock presently has a consensus rating of “Hold” and a consensus target price of $75.82.

SPS Commerce Company Profile

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.