EverCommerce Tempers Outlook as Revenue Growth Slows
Adjusted EBITDA of $44.5 million topped the prior range by $1.5 million.
EverCommerce Inc. (EVCM), a vertical-software provider for service-based businesses, tempered its 2026 outlook after second-quarter revenue growth slowed and full-year results should trend toward the low end of its forecasts.
The quarter extended a deceleration that began last year. Revenue growth eased to 2.7% from 3.6% in the first quarter and roughly 5.2% to 5.3% in each of the preceding three quarters. Pro forma growth slowed more sharply, reaching 2.0% compared with 7.4% a year earlier.
Revenue rose to $152.0 million from a year earlier and increased 3.1% sequentially. Net income from continuing operations climbed to $9.7 million, or $0.05 a share, from $5.8 million, or $0.03 a share, a year earlier.
Subscription and transaction-fee revenue increased 3.2% to $147.4 million, a slight acceleration from the first quarter's reported growth rate. On a pro forma basis, however, growth in that business slowed to 2.4% from 2.5% in the first quarter and 7.4% a year earlier.
Margins provided a counterweight to the softer top-line trajectory. Gross profit rose 4.0% to $114.5 million, lifting gross margin to about 75.3% from 74.4%. Operating income increased 10.6% to $17.5 million and operating margin widened to about 11.5%, even as sales-and-marketing and product-development expenses each rose roughly 10%.
EverCommerce kept its full-year revenue guidance at $612 million to $632 million and adjusted EBITDA guidance at $183 million to $191 million. The company now expects results toward the lower ends of both ranges, a shift from its earlier expectation that growth would accelerate during the second half and into 2027. Third-quarter guidance calls for revenue of $151.5 million to $154.5 million and adjusted EBITDA of $44 million to $46 million.
The company repurchased 1.4 million shares for $14.8 million during the quarter, leaving $19.2 million authorized at June 30. First-half operating cash flow declined 7.8% to $53.1 million as capitalized software spending increased 23.0% to $15.6 million, narrowing the cash-flow cushion as growth expectations moved lower.