EX-99 2 er_q125.htm EX-99 Document

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Exhibit 99

Contact:
Investor Relations
The Blueshirt Group
Irmina Blaszczyk & Lisa Laukkanen
SPSC@blueshirtgroup.com
415-217-4962

SPS Commerce Reports First Quarter 2025 Financial Results
Company delivers 97th consecutive quarter of topline growth
First quarter 2025 revenue grew 21% and recurring revenue grew 23% from the first quarter of 2024

MINNEAPOLIS, April 24, 2025 (GLOBE NEWSWIRE) -- SPS Commerce, Inc. (NASDAQ: SPSC), a leader in retail supply chain cloud services, today announced financial results for the first quarter ended March 31, 2025.
Financial Highlights
First Quarter 2025 Financial Highlights
•Revenue was $181.5 million in the first quarter of 2025, compared to $149.6 million in the first quarter of 2024, reflecting 21% growth.
•Recurring revenue grew 23% from the first quarter of 2024.
•Net income was $22.2 million or $0.58 per diluted share, compared to net income of $18.0 million or $0.48 per diluted share in the first quarter of 2024.
•Non-GAAP income per diluted share was $1.00, compared to non-GAAP income per diluted share of $0.86 in the first quarter of 2024.
•Adjusted EBITDA for the first quarter of 2025 increased 22% to $54.4 million compared to the first quarter of 2024.
•Share repurchases in the first quarter of 2025 totaled $40.0 million.

“SPS Commerce operates a network of over 50,000 suppliers, logistics companies and buying organizations across retail, distribution, grocery, and manufacturing, and we are uniquely positioned to support all trading relationships,” said Chad Collins, CEO of SPS Commerce. “With an $11 billion total addressable market, we have a tremendous opportunity to transform how trading partners work together as they continue to advance their supply chain technologies.”

“We delivered strong first-quarter performance, and the 97th consecutive quarter of revenue growth,” said Kim Nelson, CFO of SPS Commerce. “Despite ongoing uncertainty in the macro environment, we remain confident in our full-year 2025 growth outlook and margin expansion profile, which underscores the resilience of our business model and the mission critical nature of our solutions, designed to improve collaboration across the global retail supply chain.”


Guidance
Second Quarter 2025 Guidance
•Revenue is expected to be in the range of $184.5 million to $186.2 million, representing 20% to 21% year-over-year growth.
•Net income per diluted share is expected to be in the range of $0.41 to $0.44, with fully diluted weighted average shares outstanding of 38.8 million shares.
•Non-GAAP income per diluted share is expected to be in the range of $0.87 to $0.90.
•Adjusted EBITDA is expected to be in the range of $53.0 million to $54.5 million.
•Non-cash, share-based compensation expense is expected to be $15.5 million, depreciation expense is expected to be $5.5 million, and amortization expense is expected to be $9.8 million.

Fiscal Year 2025 Guidance
•Revenue is expected to be in the range of $758.5 million to $763.0 million, representing 19% to 20% growth over 2024.
•Net income per diluted share is expected to be in the range of $2.06 to $2.13, with fully diluted weighted average shares outstanding of 38.7 million shares.
•Non-GAAP income per diluted share is expected to be in the range of $3.86 to $3.93.
•Adjusted EBITDA is expected to be in the range of $229.4 million to $232.9 million, representing 23% to 25% growth over 2024.
•Non-cash, share-based compensation expense is expected to be $61.4 million, depreciation expense is expected to be $23.0 million, and amortization expense is expected to be $38.0 million.

The forward-looking measures and the underlying assumptions involve significant known and unknown risks and uncertainties, and actual results may vary materially. The Company does not present a reconciliation of the forward-looking non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA margin, and non-GAAP income per share, to the most directly comparable GAAP financial measures because it is impractical to forecast certain items without unreasonable efforts due to the uncertainty and inherent difficulty of predicting, within a reasonable range, the occurrence and financial impact of and the periods in which such items may be recognized.
Quarterly Conference Call
To access the call, please dial 1-833-816-1382, or outside the U.S. 1-412-317-0475 at least 15 minutes prior to the 3:30 p.m. CT start time. Please ask to join the SPS Commerce Q1 2025 conference call. A live webcast of the call will also be available at http://investors.spscommerce.com under the Events and Presentations menu. The replay will also be available on our website at http://investors.spscommerce.com.

About SPS Commerce
SPS Commerce is the world’s leading retail network, connecting trading partners around the globe to optimize supply chain operations for all retail partners. We support data-driven partnerships with innovative cloud technology, customer-obsessed service, and accessible experts so our customers can focus on what they do best. Over 50,000 recurring revenue customers in retail, grocery, distribution, supply, manufacturing, and logistics are using SPS as their retail network. SPS has achieved 97 consecutive quarters of revenue growth and is headquartered in Minneapolis. For additional information, contact SPS at 866-245-8100 or visit www.spscommerce.com.

SPS COMMERCE, SPS, SPS logo and INFINITE RETAIL POWER are marks of SPS Commerce, Inc. and registered in the U.S. Patent and Trademark Office, along with other SPS marks. Such marks may also be registered or otherwise protected in other countries. 

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Use of Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, we provide investors with Adjusted EBITDA, Adjusted EBITDA Margin, and non-GAAP income per share, all of which are non-GAAP financial measures. We believe that these non-GAAP financial measures provide useful information to our management, Board of Directors, and investors regarding certain financial and business trends relating to our financial condition and results of operations.

Our management uses these non-GAAP financial measures to compare our performance to that of prior periods for trend analyses and planning purposes. Adjusted EBITDA is also used for purposes of determining executive and senior management incentive compensation. We believe these non-GAAP financial measures are useful to an investor as they are widely used in evaluating operating performance. Adjusted EBITDA and Adjusted EBITDA Margin are used to measure operating performance without regard to items such as depreciation and amortization, which can vary depending upon accounting methods and the book value of assets, and to present a meaningful measure of corporate performance exclusive of capital structure and the method by which assets were acquired.

These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP. These non-GAAP financial measures exclude significant expenses and income that are required by GAAP to be recorded in our condensed consolidated financial statements and are subject to inherent limitations. Investors should review the reconciliations of non-GAAP financial measures to the comparable GAAP financial measures that are included in this press release.
Adjusted EBITDA Measures:
Adjusted EBITDA consists of net income adjusted for income tax expense, depreciation and amortization expense, stock-based compensation expense, realized gain or loss from investments held and foreign currency impact on cash and investments, investment income, and other adjustments as necessary for a fair presentation. Other adjustments for the three months ended March 31, 2025 included the expense impacts from disposals of certain capitalized internally developed software and one-time acquisition-related insurance costs. Net income is the comparable GAAP measure of financial performance.
Adjusted EBITDA Margin consists of Adjusted EBITDA divided by revenue. Margin, the comparable GAAP measure of financial performance, consists of net income divided by revenue.
Non-GAAP Income Per Share Measure:
Non-GAAP income per share consists of net income adjusted for stock-based compensation expense, amortization expense related to intangible assets, realized gain or loss from investments held and foreign currency impact on cash and investments, other adjustments as necessary for a fair presentation, including for the three months ended March 31, 2025 the expense impacts from disposals of certain capitalized internally developed software and one-time acquisition-related insurance costs, and the corresponding tax impacts of the adjustments to net income, divided by the weighted average number of shares of common and diluted stock outstanding during each period. Net income per share, the comparable GAAP measure of financial performance, consists of net income divided by the weighted average number of shares of common and diluted stock outstanding during each period. To quantify the tax effects, we recalculated income tax expense excluding the direct book and tax effects of the specific items constituting the non-GAAP adjustments. The difference between this recalculated income tax expense and GAAP income tax expense is presented as the income tax effect of the non-GAAP adjustments.


Forward-Looking Statements
This press release may contain forward-looking statements, including information about management's view of SPS Commerce's future expectations, plans and prospects, including our views regarding future execution within our business, the opportunity we see in the retail supply chain world and our performance for the second quarter and full year of 2025, within the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors which may cause the results of SPS Commerce to be materially different than those expressed or implied in such statements. Certain of these risk factors and others are included in documents SPS Commerce files with the Securities and Exchange Commission, including but not limited to, SPS Commerce's Annual Report on Form 10-K for the year ended December 31, 2024, as well as subsequent reports filed with the Securities and Exchange Commission. Other unknown or unpredictable factors also could have material adverse effects on SPS Commerce's future results. The forward-looking statements included in this press release are made only as of the date hereof. SPS Commerce cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, SPS Commerce expressly disclaims any intent or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.


SPS COMMERCE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except shares)

March 31,
2025		December 31,
2024
ASSETS(unaudited)
Current assets
Cash and cash equivalents$94,921 $241,017 
Accounts receivable68,183 56,214 
Allowance for credit losses(4,793)(4,179)
Accounts receivable, net63,390 52,035 
Deferred costs67,107 65,342 
Other assets26,417 23,513 
Total current assets251,835 381,907 
Property and equipment, net38,687 37,547 
Operating lease right-of-use assets8,424 8,192 
Goodwill533,940 399,180 
Intangible assets, net252,280 181,294 
Other assets
Deferred costs, non-current21,416 20,572 
Deferred income tax assets562 505 
Other assets, non-current1,906 2,033 
Total assets$1,109,050 $1,031,230 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable$11,255 $8,577 
Accrued compensation40,747 47,160 
Accrued expenses16,640 12,108 
Deferred revenue78,620 74,256 
Operating lease liabilities6,162 4,583 
Total current liabilities153,424 146,684 
Other liabilities
Deferred revenue, non-current5,748 6,189 
Operating lease liabilities, non-current6,101 7,885 
Deferred income tax liabilities20,298 15,541 
Other liabilities, non-current2,558 241 
Total liabilities188,129 176,540 
Commitments and contingencies
Stockholders' equity
Common stock40 40 
Treasury stock(102,096)(99,748)
Additional paid-in capital672,138 627,982 
Retained earnings358,295 336,099 
Accumulated other comprehensive loss(7,456)(9,683)
Total stockholders’ equity920,921 854,690 
Total liabilities and stockholders’ equity$1,109,050 $1,031,230 






SPS COMMERCE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited; in thousands, except per share amounts)

Three Months Ended
March 31,
20252024
Revenues$181,549 $149,576 
Cost of revenues56,914 51,487 
Gross profit124,635 98,089 
Operating expenses
Sales and marketing41,634 36,432 
Research and development17,439 16,009 
General and administrative31,018 25,907 
Amortization of intangible assets8,588 4,338 
Total operating expenses98,679 82,686 
Income from operations25,956 15,403 
Other income, net2,207 3,132 
Income before income taxes28,163 18,535 
Income tax expense5,967 532 
Net income$22,196 $18,003 
Net income per share
Basic$0.58 $0.49 
Diluted$0.58 $0.48 
Weighted average common shares used to compute net income per share
Basic37,990 37,049 
Diluted38,163 37,686 























SPS COMMERCE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; in thousands)

Three Months Ended
March 31,
20252024
Cash flows from operating activities
Net income$22,196 $18,003 
Reconciliation of net income to net cash provided by operating activities
Deferred income taxes(4,418)(7,070)
Depreciation and amortization of property and equipment4,957 4,694 
Amortization of intangible assets8,588 4,338 
Provision for credit losses1,822 1,408 
Stock-based compensation13,867 20,018 
Other, net168 (431)
Changes in assets and liabilities, net of effects of acquisition
Accounts receivable(7,443)(6,759)
Deferred costs(1,247)(1,651)
Other assets and liabilities1,174 3,030 
Accounts payable1,677 5,098 
Accrued compensation(7,948)(9,518)
Accrued expenses3,868 (674)
Deferred revenue3,160 4,129 
Operating leases(438)(551)
Net cash provided by operating activities39,983 34,064 
Cash flows from investing activities
Purchases of property and equipment(6,150)(3,533)
Purchases of investments— (44,412)
Maturities of investments— 45,000 
Acquisition of business, net(141,636)— 
Net cash used in investing activities(147,786)(2,945)
Cash flows from financing activities
Repurchases of common stock(40,000)(16,540)
Net proceeds from exercise of options to purchase common stock635 1,260 
Net proceeds from employee stock purchase plan activity411 391 
Net cash used in financing activities(38,954)(14,889)
Effect of foreign currency exchange rate changes661 (674)
Net increase (decrease) in cash and cash equivalents(146,096)15,556 
Cash and cash equivalents at beginning of period241,017 219,081 
Cash and cash equivalents at end of period$94,921 $234,637 




SPS COMMERCE, INC.
NON-GAAP RECONCILIATIONS
(Unaudited; in thousands, except Margin, Adjusted EBITDA Margin, and per share amounts)

Adjusted EBITDA
Three Months Ended
March 31,
20252024
Net income$22,196 $18,003 
Income tax expense5,967 532 
Depreciation and amortization of property and equipment4,957 4,694 
Amortization of intangible assets8,588 4,338 
Stock-based compensation expense13,867 20,018 
Realized gain from investments held and foreign currency impact on cash and investments(366)(304)
Investment income(1,849)(2,879)
Other1,013 — 
Adjusted EBITDA$54,373 $44,402 

Adjusted EBITDA Margin
Three Months Ended
March 31,
20252024
Revenue$181,549$149,576
Net income22,19618,003
Margin12 %12 %
Adjusted EBITDA54,37344,402
Adjusted EBITDA Margin30 %30 %

Non-GAAP Income per Share
Three Months Ended
March 31,
20252024
Net income$22,196 $18,003 
Stock-based compensation expense13,867 20,018 
Amortization of intangible assets8,588 4,338 
Realized gain from investments held and foreign currency impact on cash and investments(366)(304)
Other1,013 — 
Income tax effects of adjustments(7,285)(9,554)
Non-GAAP income$38,013 $32,501 
Shares used to compute net income and non-GAAP income per share
Basic37,990 37,049 
Diluted38,163 37,686 
Net income per share, basic$0.58 $0.49 
Non-GAAP adjustments to net income per share, basic0.42 0.39 
Non-GAAP income per share, basic$1.00 $0.88 
Net income per share, diluted$0.58 $0.48 
Non-GAAP adjustments to net income per share, diluted0.42 0.38 
Non-GAAP income per share, diluted$1.00 $0.86 

The annual per share amounts may not cross-sum due to rounding.