Want to see SPSC full AI Analyst Report?
SPS Commerce (SPSC) Q3 2026 Earnings Report
SPSC Q3 2026 EPS Results
- Actual EPS
- $1.39
- Consensus EPS
- $1.23
- Beat/Miss
- Beat by +$0.16
- One Year Ago EPS
- $1.13
SPSC Q3 2026 Revenue Results
- Actual Revenue
- $197.65M
- Expected Revenue
- $197.51M
- Beat/Miss
- Beat by +$136.00K
- YoY Revenue Growth
- +4.08%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/29/2026
- Time
- After Close
- Conference Call
- Thursday, October 29, 2026
SPS Commerce's next earnings date is estimated for February 11, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
The call was strongly positive overall. SPS reported better-than-expected core performance, significant margin expansion, strong free cash flow, improving retention metrics, and substantial progress in AI products and agentic onboarding. The main negatives were Amazon policy-driven pressure on revenue recovery, the revenue impact from the 3P divestiture, slower mid-market ERP activity, and limited customer-count growth. These headwinds affected reported growth and guidance but were outweighed by operating execution, profitability gains, and positive underlying growth commentary.
For the fourth quarter of 2026, SPS Commerce expects revenue to be in the range of $199.3 million to $201.3 million, representing approximately 4% growth at the midpoint, with underlying revenue growth expected to be between 8% and 9% excluding the negative impact from the Amazon Revenue Recovery take rate business and the divested business; adjusted EBITDA is expected to be in the range of $72.0 million to $74.0 million, fully diluted earnings per share in the range of $0.74 to $0.79, fully diluted weighted average shares outstanding of approximately 36.0 million shares, and non-GAAP diluted income per share in the range of $1.31 to $1.36, with stock-based compensation expense of approximately $17.0 million, depreciation expense of approximately $6.1 million and amortization expense of approximately $12.3 million. For the full year 2026, revenue is expected in the range of $786.9 million to $788.9 million, representing approximately 5% growth over 2025 at the midpoint, with underlying full year 2026 revenue projected to grow high single digits; adjusted EBITDA is expected in the range of $267.4 million to $269.4 million, reflecting an adjusted EBITDA margin of 34% at the midpoint, an increase of approximately 330 basis points compared to full year 2025; fully diluted earnings per share is expected in the range of $2.29 to $2.35, with fully weighted average shares outstanding of approximately 36.6 million shares, and non-GAAP diluted income per share in the range of $5.05 to $5.11, with stock-based compensation expense of approximately $69.5 million, depreciation expense of approximately $24.1 million and amortization expense for the year of approximately $40.8 million; for the remainder of the year, investors should model approximately 30% effective tax rate calculated on GAAP pretax net earnings.
- Strong Third-Quarter Revenue and Core Business PerformanceQ3 2026 revenue was $197.6 million, up 4% year-over-year, while recurring revenue also grew 4% year-over-year. Management said core business growth exceeded expectations, supported by stronger-than-expected ARPU, solid GRR, and momentum in subscription revenue recovery.
- Significant Adjusted EBITDA and Margin ExpansionAdjusted EBITDA increased 17% to $70.9 million, representing 36% of revenue and exceeding the company’s long-term margin target of 35%. Adjusted gross margin was 73%, up 170 basis points year-over-year, while adjusted sales and marketing, G&A, and R&D each declined as a percentage of revenue.
- Strong Cash Flow and Share RepurchasesThe company ended the quarter with $184 million in cash, cash equivalents, and short-term investments. Q3 free cash flow was $58.5 million, bringing trailing 12-month free cash flow to $202.6 million, up 37% year-over-year. SPS deployed 84% of quarterly free cash flow to repurchase $48.8 million of shares.
- Customer Base and ARPU ExpansionRecurring revenue customers increased sequentially to 46,700, and average revenue per customer was $16,200. Management said growth is increasingly driven by ARPU expansion through additional trading-partner connections, analytics, revenue recovery, larger customers, and future MAX agent offerings.
- MAX Agentic AI Generally Available to Fulfillment CustomersMAX is now available to all fulfillment customers and is designed to identify operational anomalies, prevent errors, and guide users through supply chain workflows using SPS network intelligence. Management reported positive customer feedback and high return usage for MAX Chat.
- Quantifiable Customer ROI from MAXRIP-IT Sports saved $200,000 in its first week using MAX by identifying chargebacks, late receivables, and a process error. MAX detected more than 200 shipment-status failures for Zevia and its 3PL; SPS estimated that up to $3 million in receivables could have been delayed without timely detection and invoicing. Something Inked expects MAX to save hundreds of hours per year and thousands of dollars in overhead.
- Expansion of AI Product PortfolioSPS launched or expanded several AI-enabled capabilities, including MAX, Decision Intelligence, and Visibility Management. Decision Intelligence combines sell-through, inventory, and supply-chain signals, while Visibility Management provides a real-time purchase-order status view across ERP, warehouse, transportation-management, and carrier systems.
- Accelerated Agentic OnboardingHundreds of suppliers achieved full compliance with new trading partners within 24 hours using agentic onboarding. SPS has completed many complex ERP integration and onboarding projects in less than 30 days and expects to shorten those cycles further. A manufacturer requiring 21 integrations completed setup and testing in two weeks, while a major dairy company onboarded more than 70 trading partners in just weeks after an acquisition.
- Onboarding Validation Prevented Compliance IssuesFor the manufacturer of safety and fall-protection gear, SPS validation agents identified incorrect carrier codes and shipping serial IDs that could have caused advance-shipping-notice compliance issues and potential retailer chargebacks. The customer corrected both errors before production.
- Retail Programs and Customer Expansion MomentumRetail activity was described as strong in Q3 and continuing into Q4, with some momentum expected to carry into 2027. Large retail programs contributed more heavily to ARPU than customer count, and SPS continues to see demand for digitally enabling suppliers for major retailers and distributors.
- Improved Retention and Customer Treatment MetricsGRR continued to improve year-over-year and was ahead of plan in Q3. Management attributed progress to closer alignment between customer success and sales, improved customer-treatment strategies, and investments in onboarding and MAX that are expected to increase product stickiness.
- Positive Decision Intelligence Platform ProgressThe replatformed Decision Intelligence offering produced more favorable customer sentiment and retention metrics among customers migrated to the new platform and improved SPS’s competitiveness in new business. The company expects to launch additional AI capabilities for Decision Intelligence in the first half of 2027.
- Fourth-Quarter and Full-Year Profitability GuidanceQ4 revenue guidance is $199.3 million to $201.3 million, adjusted EBITDA guidance is $72.0 million to $74.0 million, fully diluted EPS guidance is $0.74 to $0.79, and non-GAAP diluted income per share guidance is $1.31 to $1.36. Full-year adjusted EBITDA guidance is $267.4 million to $269.4 million, representing a 34% adjusted EBITDA margin at the midpoint and an increase of approximately 330 basis points versus 2025.
- Underlying Revenue Growth OutlookExcluding the Amazon Revenue Recovery take-rate business and the divested business, underlying Q4 revenue growth is expected to be between 8% and 9%. Excluding those impacts, underlying full-year 2026 revenue is projected to grow high single digits.
- Expected Continued Margin ExpansionManagement expects further margin expansion from operating leverage, process improvements, economies of scale from prior back-office investments, internal AI use cases, and increasing use of onboarding agents. The company said agentic onboarding has another approximately 12 months of roadmap development and should support margin improvement over the next 12 to 18 months.
- Revenue Recovery Growth and Subscription StrategyExcluding the Amazon take-rate portion, revenue recovery was described as the fastest-growing portion of the overall business. SPS is leading its go-to-market approach with subscription revenue while retaining take-rate capabilities where competitive requirements demand them; management said the shift of some customers from take rate to subscription moved faster than expected and is a long-term positive.
- AI Monetization and Capital Allocation PlansSPS expects to monetize MAX-powered solutions in 2027 and plans to charge for MAX agents while prioritizing broad customer adoption over maximizing initial pricing. Management said the current best use of capital is share repurchases, with $48.8 million repurchased in Q3, while keeping other options open over the next 12 to 18 months.
- Competitive Differentiation from Supply-Chain DataManagement said SPS’s agentic capabilities are differentiated by a network with more than 300,000 trading relationships, nearly three decades of proprietary knowledge, customer supply-chain data, network trends, and retailer-specific compliance rules, including rules that are not documented elsewhere.
SPSC Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Feb 11, 2027 | 2026 (Q4) | 1.34- | 1.14 | ― | ― |
| Oct 29, 2026 | 2026 (Q3) | 1.231.39 | 1.13 | 23.01% (+0.26) | |
| Jul 30, 2026 | 2026 (Q2) | 1.091.27 | 1 | 27.00% (+0.27) | |
| Apr 30, 2026 | 2026 (Q1) | 1.021.10 | 1 | 10.00% (+0.10) | |
| Feb 12, 2026 | 2025 (Q4) | 1.011.14 | 0.89 | 28.09% (+0.25) | |
| Oct 30, 2025 | 2025 (Q3) | 1.051.13 | 0.92 | 22.83% (+0.21) | |
| Jul 30, 2025 | 2025 (Q2) | 0.911.00 | 0.8 | 25.00% (+0.20) | |
| Apr 24, 2025 | 2025 (Q1) | 0.851.00 | 0.86 | 16.28% (+0.14) | |
| Feb 10, 2025 | 2024 (Q4) | 0.870.89 | 0.75 | 18.67% (+0.14) | |
| Oct 24, 2024 | 2024 (Q3) | 0.830.92 | 0.75 | 22.67% (+0.17) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
