SPS Commerce Q3 revenue slightly beats estimates amid agentic transformation
Overview
US supply chain network platform's Q3 revenue grew 4% yr/yr, slightly beating analyst expectations
Q3 adjusted EBITDA rose 17%, beating analyst expectations
Revenue growth partially offset by divestiture of 3P Revenue Recovery business and 1P model variability
Outlook
SPS Commerce expects Q4 revenue of $199.3 mln to $201.3 mln
Company sees 2026 revenue of $786.9 mln to $788.9 mln
Company says 2026 guidance reflects $10.5 mln revenue reduction from 3P Revenue Recovery divestiture
Result Drivers
DIVESTITURE IMPACT - Co said Q3 revenue growth was partially offset by the divestiture of the 3P Revenue Recovery business and variability in the 1P Revenue Recovery take rate model
AGENTIC TRANSFORMATION - Co said agentic transformation initiatives across product portfolio and internal operations drove efficiency gains
COST MANAGEMENT - Co attributed margin expansion to disciplined cost management and efficiency gains from agentic customer onboarding
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Slight Beat* | $197.60 mln | $197.45 mln (10 Analysts) |
Q3 Net Income | $30.70 mln | ||
Q3 Adjusted EBITDA | Beat | $70.90 mln | $68.79 mln (9 Analysts) |
*Applies to a deviation of less than 1%; not applicable for per-share numbers.
Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 3 "strong buy" or "buy", 9 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the software peer group is "buy"
Wall Street's median 12-month price target for SPS Commerce, Inc. is $76.00, about 11.2% below its October 28 closing price of $85.59
The stock recently traded at 16 times the next 12-month earnings vs. a P/E of 12 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)