SPS Commerce's Q1 2025 Earnings Call: Unpacking Key Contradictions in Macroeconomics, Customer Growth, and Strategy

Macroeconomic impact and customer behavior, Carbon6 customer growth and contribution, analytics growth expectations, customer acquisition strategy and TAM, cross-sell opportunities are the key contradictions discussed in SPS Commerce's latest 2025Q1 earnings call.



Revenue and Recurring Revenue Growth:
- SPS Commerce reported a 21% increase in revenue to $181.5 million in Q1 2025, with recurring revenue growing by 23%.
- This growth was driven by the evolving needs of supply chains, emphasizing the value of automation and improved trading partner relationships.

Acquisitions and Expanded Product Portfolio:
- The acquisition of Carbon6 added approximately 8,500 customers, enhancing their product portfolio with revenue recovery solutions.
- This acquisition positioned SPS Commerce as a leader in the emerging revenue recovery category, supporting supplier communities of major retailers.

Customer Acquisition and Community Enablement:
- SPS Commerce added approximately 54,150 recurring revenue customers in Q1, with a net increase of 300 organic customers.
- The increase was driven by strong performance in community enablement programs, with a mix shift towards new subscribing customers.

Impact of Uncertainty and Tariffs:
- While tariffs and macroeconomic uncertainties are top of mind for customers, they have not yet significantly impacted SPS's enablement programs or customer acquisition.
- They remain closely monitored to understand potential future impacts on the business.