SPS Commerce Narrows Full-Year Outlook After Sale

The Tip Desk · October 31, 2026 · 3 min read

Third-quarter revenue was $197.6 million, up 4% from a year earlier, as the company booked $30.7 million of net income, or $0.85 a share.

SPS Commerce, Inc. (SPSC), the intelligent supply chain network, reported third-quarter revenue of $197.6 million, up 4% from $189.9 million a year earlier, a slower pace than the 6% year-over-year increase in both the second and first quarters of 2026.

The company said the 4% increase was partially offset by the June 30 sale of the 3P Revenue Recovery business and variability in the 1P Revenue Recovery take-rate model. Recurring revenue also grew 4%, slower than 6% growth in the second quarter and 7% growth in the first quarter.

Profitability moved in the other direction. Adjusted EBITDA rose 17% to $70.9 million from $60.5 million a year earlier, after 19% growth to $66.6 million in the second quarter. Adjusted EBITDA margin expanded to 36% from 32% a year earlier. Net income was $30.7 million, or $0.85 a share, versus $25.6 million, or $0.67 a share. Non-GAAP income was $50.2 million, or $1.39 a share.

Gross profit was $140.5 million, with cost of revenues of $57.1 million. Chief Financial Officer Joe Del Preto said the results demonstrated operating leverage and that continued margin expansion reflected disciplined cost management and efficiency gains from agentic customer onboarding. Chief Executive Chad Collins said progress on agentic transformation initiatives had exceeded his expectations.

Share repurchases totaled $48.8 million in the quarter. Cash and cash equivalents were $153.8 million at September 30, with short-term investments of $29.7 million.

The company said the 3P Revenue Recovery divestiture reduces second-half 2026 revenue guidance by about $10.5 million and is expected to be neutral to Adjusted EBITDA in the second half. Fourth-quarter revenue is expected to be $199.3 million to $201.3 million, versus third-quarter guidance of $196.3 million to $198.3 million issued after the second quarter. Fourth-quarter Adjusted EBITDA is expected to be $72.0 million to $74.0 million. Net income per diluted share is expected to be $0.74 to $0.79, and non-GAAP income per diluted share $1.31 to $1.36.

Fiscal-year 2026 revenue guidance was narrowed to $786.9 million to $788.9 million, representing about 5% growth over 2025, from $788.4 million to $793.4 million after the second quarter and $796.0 million to $802.0 million after the first quarter. Full-year Adjusted EBITDA is expected to be $267.4 million to $269.4 million, a 34% margin at the midpoint and about 330 basis points above full-year 2025. Net income per diluted share is expected to be $2.29 to $2.35, and non-GAAP income per diluted share $5.05 to $5.11.

SPS Commerce said its AI-powered network connects more than 300,000 trading relationships and moves more than 750 million transactions and over $650 billion in gross merchandise value each year.