What changed in this filing

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Item 1. Financial Statements

2025-04-24 compared with 2024-10-24 · 141 added, 184 removed, 411 unchanged (44% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except shares) September 30,

(in thousands, except shares) March 31,

2025 December 31,

2 unchanged sentences

Cash and cash equivalents $ 94,921 $ 241,017

Short-term investments 6,931 56,359

Accounts receivable 68,183 56,214

40 unchanged sentences

Retained earnings 358,295 336,099

Accumulated other comprehensive gain (loss) ( 1,185 ) 222

Accumulated other comprehensive loss ( 7,456 ) ( 9,683 )

Total stockholders’ equity 920,921 854,690

2 unchanged sentences

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Form 10-Q for the Quarterly Period ended March 31, 2025

SPS COMMERCE, INC.

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except per share amounts) (unaudited) 2025 2024

16 unchanged sentences

Unrealized gain on investments, net of tax of $ — and $ 171 , respectively

84 570 1,089 1,376

Reclassification of gain on investments into earnings, net of tax of $ — and $( 215 ), respectively

( 248 ) ( 412 ) ( 1,610 ) ( 1,169 )

Total other comprehensive income (expense) 2,227 ( 3,450 )

8 unchanged sentences

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Form 10-Q for the Quarterly Period ended March 31, 2025

SPS COMMERCE, INC.

2 unchanged sentences

Capital Retained

Earnings Accumulated Other Comprehensive Loss Total

Stockholders'

(in thousands, except shares) (unaudited) Shares Amount Shares Amount

Balances, June 30, 2023 36,646,819 $ 39 2,151,098 $ ( 128,892 ) $ 508,484 $ 223,192 $ ( 1,842 ) $ 600,981

Stock-based compensation — — — — 10,780 — — 10,780

Shares issued pursuant to stock awards 45,952 — — — 705 — — 705

Employee stock purchase plan activity 3,159 — — — 344 — — 344

Net income — — — — — 16,842 — 16,842

Foreign currency translation adjustments — — — — — — ( 2,966 ) ( 2,966 )

Unrealized gain on investments, net of tax — — — — — — 570 570

Reclassification of gain on investments into earnings, net of tax — — — — — — ( 412 ) ( 412 )

Balances, September 30, 2023 36,695,930 $ 39 2,151,098 $ ( 128,892 ) $ 520,313 $ 240,034 $ ( 4,650 ) $ 626,844

Balances, June 30, 2024 37,086,627 $ 39 2,333,099 $ ( 162,187 ) $ 574,842 $ 295,080 $ ( 4,353 ) $ 703,421

Stock-based compensation — — — — 9,996 — — 9,996

Shares issued pursuant to stock awards 72,852 — — — 1,884 — — 1,884

Employee stock purchase plan activity 2,833 — — — 453 — — 453

Repurchases of common stock, net of costs ( 456 ) — 456 ( 84 ) — — — ( 84 )

Reissuances of treasury stock 404,587 — ( 404,587 ) 62,523 24,544 — — 87,067

Net income — — — — — 23,460 — 23,460

Foreign currency translation adjustments — — — — — — 3,332 3,332

Unrealized gain on investments, net of tax — — — — — — 84 84

Reclassification of gain on investments into earnings, net of tax — — — — — — ( 248 ) ( 248 )

Balances, September 30, 2024 37,566,443 $ 39 1,928,968 $ ( 99,748 ) $ 611,719 $ 318,540 $ ( 1,185 ) $ 829,365

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Common Stock Treasury Stock Additional

Capital Retained

Earnings Accumulated Other Comprehensive Gain (Loss) Total

5 unchanged sentences

Employee stock purchase plan activity 2,398 — — — 391 — — 391

Repurchases of common stock, net of costs ( 109,480 ) — 109,480 ( 20,000 ) — — — ( 20,000 )

Net income — — — — — 18,003 — 18,003

2 unchanged sentences

Reclassification of gain on investments into earnings, net of tax — — — — — — ( 646 ) ( 646 )

Balances, September 30, 2023 36,695,930 $ 39 2,151,098 $ ( 128,892 ) $ 520,313 $ 240,034 $ ( 4,650 ) $ 626,844

Balances, March 31, 2024 37,049,001 $ 39 2,260,578 $ ( 148,892 ) $ 557,998 $ 277,048 $ ( 3,228 ) $ 682,965

Balances, December 31, 2024 37,661,308 $ 40 1,928,968 $ ( 99,748 ) $ 627,982 $ 336,099 $ ( 9,683 ) $ 854,690

6 unchanged sentences

Foreign currency translation adjustments — — — — — — 2,227 2,227

Unrealized gain on investments, net of tax — — — — — — 1,089 1,089

Reclassification of gain on investments into earnings, net of tax — — — — — — ( 1,610 ) ( 1,610 )

Balances, September 30, 2024 37,566,443 $ 39 1,928,968 $ ( 99,748 ) $ 611,719 $ 318,540 $ ( 1,185 ) $ 829,365

Balances, March 31, 2025 38,001,227 $ 40 1,831,869 $ ( 102,096 ) $ 672,138 $ 358,295 $ ( 7,456 ) $ 920,921

See accompanying notes to these condensed consolidated financial statements.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Form 10-Q for the Quarterly Period ended March 31, 2025

SPS COMMERCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended

September 30,

Three Months Ended

(in thousands) (unaudited) 2025 2024

8 unchanged sentences

Other, net 168 ( 431 )

Changes in assets and liabilities, net of effects of acquisitions

Changes in assets and liabilities, net of effects of acquisition

Accounts receivable ( 7,443 ) ( 6,759 )

11 unchanged sentences

Maturities of investments — 45,000

Acquisition of businesses, net ( 147,401 ) ( 70,218 )

Acquisition of business, net ( 141,636 ) —

Net cash used in investing activities ( 147,786 ) ( 2,945 )

3 unchanged sentences

Net proceeds from employee stock purchase plan activity 411 391

Net cash provided by (used in) financing activities ( 27,697 ) 10,005

Net cash used in financing activities ( 38,954 ) ( 14,889 )

Effect of foreign currency exchange rate changes 661 ( 674 )

4 unchanged sentences

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Form 10-Q for the Quarterly Period ended March 31, 2025

SPS COMMERCE, INC.

2 unchanged sentences

Business Description

SPS Commerce is a leading provider of cloud-based supply chain management services across our global retail network.

Our products make it easier for retailers, grocers, distributors, suppliers, and logistics firms to communicate and collaborate by simplifying how they manage and share item, inventory, order and sales data across omnichannel retail channels.

We deliver our products using a full-service model, which includes industry-leading technology and a team of experts that optimize, update, and operate the technology on customers' behalf.

Our products enable customers to increase supply chain performance, optimize inventory levels and sell-through, reduce operational costs, improve order visibility, and satisfy consumer demands for a seamless omnichannel experience.

SPS Commerce is transforming how our global retail supply chain co-operates by creating a more dynamic, interconnected community where players can more freely connect, collaborate, and prosper together.

Our comprehensive suite of cloud-based products and solutions lead the industry in establishing and maintaining stronger collaboration between retailers, grocers, distributors, suppliers, manufacturers, and logistics firms around the globe.

Our products enable customers to enhance how they operate:

both within their organizations and with their trading partners, with reduced operational costs and stronger supply chain performance;

with order and supply chain visibility, sell-through data, and optimized inventory management, and;

through the limitless access to connect and grow with the world’s largest retail network of trading partners that only SPS Commerce can offer.

Basis of Presentation

11 unchanged sentences

Significant Accounting Policies

There were no material changes in our significant accounting policies during the nine months ended September 30, 2024 .

See Note A to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023 , as filed with the SEC, for additional information regarding our significant accounting policies.

Accounting Pronouncements Recently Issued and Adopted

Standard Date of Issuance Description Date of Adoption Effect on the Financial Statements

ASU 2023-07 , Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures

November 2023 This amendment requires that an entity disclose significant segment expenses impacting profit and loss that are regularly provided to the chief operating decision maker.

2024 The adoption will result in additional disclosure in our Annual Report on Form 10-K for the year ended December 31, 2024.

There were no material changes in our significant accounting policies, nor were there differences in the basis of our segmentation, during the three months ended March 31, 2025 .

See Note A to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 as filed with the SEC.

Accounting Pronouncements Not Yet Adopted

Standard Date of Issuance Description Year of Required Adoption Effect on the Financial Statements

ASU 2023-09 , Income Taxes (Topic 740) - Improvements to Income Tax Disclosures

December 2023 This amendment requires that an entity disclose specific categories in the effective tax rate reconciliation table as well as provide disclosure of disaggregated information related to income tax expense, income before income taxes, and income taxes paid.

2025 The adoption will result in additional disclosure in our Annual Report on

Form 10-K for the year ending December 31, 2025.

ASU 2024-03 , Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)

November 2024 This amendment requires that an entity disclose in its notes to financial statements specified information about certain costs and expenses.

2027 We are currently evaluating the adoption on our financial statements and anticipate the impact will result in additional disclosure.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Form 10-Q for the Quarterly Period ended March 31, 2025

NOTE B – Business Acquisitions

SupplyPike, Inc.

Effective July 31, 2024, we acquired SupplyPike, Inc.

("SupplyPike"), an automated invoice deduction management and prevention solution, through the purchase of all of the outstanding equity ownership interests of SupplyPike.

Pursuant to the definitive agreement and plan of merger, the total consideration transferred at close was $ 205.8 million, net of cash acquired and subject to customary post-close adjustments.

The consideration was comprised of $ 118.6 million paid in cash and 404,587 shares of SPS common stock (valued at $ 87.2 million, determined at acquisition close based on the price of SPS common stock).

The shares were issued from SPS treasury shares, see Note J - Stockholders' Equity for further detail on the treasury share reissuance.

The purchase accounting for the acquisition has not been finalized as of September 30, 2024;

provisional amounts are primarily related to intangible assets and tax components.

Carbon6 Technologies, Inc.

On December 30, 2024, we entered into a definitive agreement to acquire all of the outstanding equity ownership interests of Carbon6 Technologies, Inc.

("Carbon6"), a provider of software tools to Amazon sellers, including specialized offerings for revenue recovery for both first-party ("1P") and third-party ("3P") suppliers.

The acquisition became effective on February 4, 2025 (" Close").

Pursuant to the definitive agreement, the total consideration transferred at Close was $ 209.3 million, net of cash acquired, and subject to customary post-close adjustments.

The consideration was comprised of $ 141.6 million paid in cash, net of cash acquired, and 378,100 shares of SPS common stock (valued at $ 67.7 million, determined at acquisition Close based on the price of SPS common stock).

The shares were issued from SPS treasury shares.

The purchase accounting for the acquisition has not been finalized as of March 31, 2025;

provisional amounts are primarily related to intangible assets and tax components, and correspondingly goodwill.

We will finalize the allocation of the purchase price within the one-year measurement period following the acquisition.

9 unchanged sentences

Estimated fair value of assets and liabilities acquired:

Other assets 3,659

Accounts receivable 5,868

Other assets, current 7,782

Intangible assets

1 unchanged sentence

Developed technology 25,200

Deferred revenue ( 2,297 )

Other liabilities ( 2,643 )

Other liabilities, current and non-current ( 7,682 )

Deferred income tax liabilities, net ( 10,274 )

4 unchanged sentences

Developed technology 9.0 years

Traverse Systems

Effective May 8, 2024, we entered into an asset purchase agreement to acquire certain assets of Traverse Systems LLC ("Traverse Systems"), an industry-leading provider in retailer supply chain performance and vendor management.

Total consideration transferred at close was $ 29.4 million, subject to customary post-close adjustments, which was comprised of $ 25.0 million paid in cash and 22,874 shares of SPS common stock (valued at $ 4.4 million, determined at acquisition close based o n the price of S PS common stock).

The shares were issued from SPS treasury shares, see Note J - Stockholders' Equity for further detail on the treasury share reissuance.

Unaudited Pro Forma Financial Information

The following unaudited pro forma financial information presents the combined results of SPS and Carbon6 assuming the acquisition was completed as of the beginning of the prior fiscal year, January 1, 2024.

These unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined companies would have been, nor are they indicative of future results of operations.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Form 10-Q for the Quarterly Period ended March 31, 2025

The pro forma results reflect certain adjustments, such as one-time acquisition-related costs, incremental impact for amortization of acquired intangibles, and the elimination of debt extinguishment and interest costs.

The adjustments do not reflect synergies or costs that would have been expected to result from the integration of the acquisition.

Pro forma consolidated revenue and net income for the three months ended March 31, 2025 and 2024 are as follows:

Three Months Ended

(in thousands) 2025 2024

Revenue $ 185,730 $ 158,120

Net income 28,382 13,111

SupplyPike, Inc.

Effective July 31, 2024, we acquired SupplyPike, Inc.

("SupplyPike"), an automated invoice deduction management and prevention solution, through the purchase of all of the outstanding equity ownership interests of SupplyPike.

Pursuant to the definitive agreement and plan of merger, the total consideration transferred at close was $ 205.8 million, net of cash acquired.

The consideration was comprised of $ 118.6 million paid in cash, net of cash acquired, and 404,587 shares of SPS common stock (valued at $ 87.2 million, determined at acquisition close based on the price of SPS common stock).

The shares were issued from SPS treasury shares.

The purchase accounting for the acquisition was finalized in the three months ending March 31, 2025;

provisional adjustments were primarily related to intangible assets and tax components, and correspondingly goodwill.

The goodwill associated with the acquisition is not deductible for income tax purposes.

Purchase Price Allocation

We accounted for the acquisition as a business combination.

We allocated the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date.

Assets acquired primarily comprised of subscriber relationships and developed technology intangible assets, totaling $ 7.7 million and $ 3.6 million of estimated fair value, respectively, and $ 18.4 million was allocated to goodwill.

The remainder of the consideration transferred was allocated to net assets acquired other than the intangible assets.

The purchase accounting for the acquisition was finalized as of September 30, 2024.

The goodwill associated with the acquisition is deductible for income tax purposes.

Other Acquisition Activity

Effective April 10, 2024, the Company entered into an asset purchase agreement to acquire Vision33's SAP Business One SPS Integration Technology.

Pursuant to the definitive agreement, the purchase price, denominated in Canadian dollars ("CAD"), was $ 5.8 million CAD ($ 4.3 million U.S.

dollars ["USD"] at the Agreement date exchange rate), of which $ 4.5 million CAD ($ 3.3 million USD) was paid in cash at close, with the remainder payable in cash within two years , subject to certain closing conditions.

Assets acquired were primarily comprised of developed technology and subscriber relationships, totaling $ 1.7 million USD and $ 0.4 million USD of estimated fair value, respectively.

The remainder of the consideration transferred, $ 2.2 million USD, was allocated to goodwill.

The purchase accounting for the acquisition was finalized as of June 30, 2024.

The goodwill associated with the acquisition is deductible for income tax purposes.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

The following table presents the purchase consideration and estimated fair values of acquired assets and liabilities recorded in the Company's condensed consolidated balance sheet as of the acquisition date:

(in thousands)

Cash paid $ 124,769

Equity consideration 87,156

Total consideration $ 211,925

Estimated fair value of assets and liabilities acquired:

Other assets, current and non-current 3,732

Intangible assets

Subscriber relationships 62,967

Developed technology 21,090

Deferred revenue ( 2,297 )

Other liabilities, current and non-current ( 2,644 )

Deferred income tax liabilities, net ( 15,098 )

Total fair value of assets and liabilities acquired $ 73,868

Goodwill $ 138,057

The following table summarizes the estimated useful lives for each acquired intangible asset:

Subscriber relationships 9.0 years

Developed technology 8.0 years

NOTE C – Revenue

Revenue by Product Type

We derive our revenues from the following revenue streams:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

6 unchanged sentences

Total revenue $ 181,549 $ 149,576

Revenues are the amount that reflects the consideration we are contractually and legally entitled to, as well as the amount we expect to collect, in exchange for those services.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

Revenue by Geographic Area

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Domestic revenue 85 % 83 %

2 unchanged sentences

Recurring Revenues

Recurring revenues consist of recurring subscriptions from customers that utilize our Fulfillment, Analytics, and Other supply chain management products.

Revenue for these products is generally recognized on a ratable basis over the contract term beginning on the date that our service is made available to the customer.

Our contracts with our recurring revenue customers are recurring in nature, generally ranging from monthly to annual, and generally allow the customer to cancel the contract for any reason with 30 to 90 days’ notice.

Timing of billings varies by customer and by contract type and generally are either in advance or within 30 days of the service being performed.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

We define recurring revenue as active contracts during the reporting period to regularly pay us fees for subscription-based and reoccurring services.

All components of the contracts that are not expected to recur (primarily set ups and professional services) are excluded from recurring revenue.

Revenue for subscription-based services is recognized on a ratable basis over the contract term beginning on the date that our service is made available to the customer.

Our contracts primarily range from monthly to annual and generally allow the customer to cancel the contract for any reason with 30 to 90 days’ notice.

Timing of billings varies by customer and by contract type and are either in advance or within 30 days of the service being performed.

Given that the recurring revenue contracts are generally for one year or less, we have applied the optional exemption to not disclose information about the remaining performance obligations for recurring revenue contracts.

2 unchanged sentences

Set-up revenues

Set-up fees are specific for each connection a customer has with a trading partner.

Set-up fees, a component of our revenue, are specific for each connection a customer has with a trading partner.

These nonrefundable fees are necessary for our customers to utilize our services and do not provide any standalone value.

3 unchanged sentences

The table below presents the activity of the portion of the deferred revenue liability relating to set-up fees.

We expect to recognize $ 13.5 million of the balance as of September 30, 2024 as revenue over the next 12 months with the remaining amount recognized thereafter.

We expect to recognize $ 12.1 million of the balance as of March 31, 2025 as revenue over the next 12 months with the remaining amount recognized thereafter.

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

4 unchanged sentences

Miscellaneous one-time revenues

Miscellaneous one-time fees consist of professional services and testing and certification.

Miscellaneous one-time fees primarily consist of professional services and testing and certification.

The contract period for these one-time fees is for one year or less and recognized at the time service is provided.

We have applied the optional exemption to not disclose information about the remaining performance obligations for miscellaneous one-time fee contracts since they have original durations of one year or less.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

Deferred Revenue

We recognized revenue of $ 61.8 million and $ 52.4 million in the nine months ended September 30, 2024 and 2023, respectively, from amounts included in deferred revenue at the beginning of the period.

We recognized revenue of $ 42.8 million and $ 36.6 million in the three months ended March 31, 2025 and 2024, respectively, from amounts included in deferred revenue at the beginning of the period.

NOTE D – Deferred Costs

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

3 unchanged sentences

Balance, end of period $ 88,523 $ 84,248

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

NOTE E – Fair Value Measurements

Cash equivalents and investments, as measured at fair value on a recurring basis, consisted of the following:

September 30, 2024 December 31, 2023

Fair Value Level Amortized Cost Unrealized Gains (Losses), net Fair Value Fair Value Level Amortized Cost Unrealized Gains (Losses), net Fair Value

Cash equivalents, as measured at fair value on a recurring basis, consisted of the following:

March 31, 2025 December 31, 2024

Fair Value Level Amortized Cost Unrealized Gains (Losses), net Fair Value Amortized Cost Unrealized Gains (Losses), net Fair Value

(in thousands)

Cash equivalents:

Money market funds Level 1 $ 135,700 $ — $ 135,700 Level 1 $ 161,233 $ — $ 161,233

Certificates of deposit Level 2 6,931 — 6,931 Level 1 6,805 — 6,805

Marketable securities:

Commercial paper Level 2 — — — Level 2 48,860 694 49,554

$ 142,631 $ — $ 142,631 $ 216,898 $ 694 $ 217,592

Money market funds Level 1 $ 70,944 $ — $ 70,944 $ 178,417 $ — $ 178,417

NOTE F – Allowance for Credit Losses

The allowance for credit losses activity, included in accounts receivable, net, was as follows:

Nine Months Ended

September 30,

Three Months Ended

(in thousands) 2025 2024

3 unchanged sentences

Balance, end of period $ 4,793 $ 3,589

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

NOTE G – Property and Equipment, Net

Property and equipment, net consisted of the following:

(in thousands) September 30, 2024 December 31, 2023

(in thousands) March 31, 2025 December 31, 2024

Internally developed software $ 78,558 $ 73,617

5 unchanged sentences

Total property and equipment, net $ 38,687 $ 37,547

Property and equipment, net located at subsidiary and office locations outside of the U.S.

Property and equipment, net located outside of the U.S.

was as follows:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

International property and equipment 20 % 18 %

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

NOTE H – Goodwill and Intangible Assets, Net

The activity in goodwill was as follows:

(in thousands) Nine Months Ended

September 30, 2024

(in thousands) Three Months Ended

March 31, 2025

Balance, beginning of period $ 399,180

5 unchanged sentences

Intangible assets, net consisted of the following:

September 30, 2024

March 31, 2025

($ in thousands) Gross

5 unchanged sentences

$ 330,156 $ ( 78,707 ) $ 831 $ 252,280 7.1 years

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

December 31, 2024

11 unchanged sentences

Total future amortization $ 252,280

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

NOTE I – Commitments and Contingencies

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

3 unchanged sentences

Supplemental cash flow information related to leases was as follows:

Nine Months Ended

September 30,

Three Months Ended

(in thousands) 2025 2024

3 unchanged sentences

Supplemental balance sheet information related to operating leases was as follows:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Weighted-average remaining lease term 2.1 years 2.4 years

Weighted-average discount rate 4.2 % 4.3 %

At September 30, 2024, our future minimum payments under operating leases were as follows:

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

At March 31, 2025, our future minimum payments under operating leases were as follows:

(in thousands)

5 unchanged sentences

Purchase Commitments

We have entered into separate noncancelable agreements with computing infrastructure, productivity software, customer relationship management, and performance and security data analytics vendors for services through 2026.

At September 30, 2024, our remaining purchase commitments and estimated purchase timing were as follows:

We have entered into separate noncancelable agreements with vendors for computing infrastructure, software platforms, and other service arrangements through 2030.

At March 31, 2025, our remaining purchase commitments and estimated purchase timing were as follows:

(in thousands)

Remainder of 2025 $ 11,297

Thereafter 4,137

Total estimated future purchases $ 20,614

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

NOTE J – Stockholders’ Equity

1 unchanged sentence

Our board of directors has authorized multiple non-concurrent programs to repurchase our common stock.

Details of the programs and activity thereunder through September 30, 2024 were as follows:

Details of the programs and activity thereunder through March 31, 2025 were as follows:

(in thousands) Effective Date Expiration Date Share Value Authorized for Repurchase Share Value Repurchased Unused & Expired Share Repurchase Value Share Value Available for Future Repurchase

1 unchanged sentence

2024 Program August 2024 July 2026 100,000 39,994 N/A $ 60,006

Share repurchases are accounted for as the trade date occurs and are reflected in the condensed consolidated financial statements net of the costs incurred to acquire the shares.

Share repurchases that have not yet settled in cash are included in accrued expenses in the condensed consolidated balance sheet.

The share repurchase activity by period was as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except shares and per share amounts) 2025 2024

3 unchanged sentences

Treasury Stock Reissuance

In connection with the acquisitions of SupplyPike and Traverse Systems, the Company re-issued treasury shares as part of the purchase considerations (see Note B – Business Combinations for further information).

Treasury stock reissuances are accounted for using the specific identification method, with gains (or losses to the extent of previously recognized gains) recognized in additional paid-in capital and any remaining loss recorded in retained earnings.

In connection with the acquisition of Carbon6 in the three months ended March 31, 2025 , the Company re-issued treasury shares as part of the purchase consideration (see Note B – Business Combinations for further information).

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

NOTE K – Stock-Based Compensation

Our equity compensation plans provide for the grant of incentive and nonqualified stock options, as well as other stock-based awards including performance share units (“PSUs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), and deferred stock units (“DSUs”), to employees, non-employee directors and other consultants who provide services to us.

Our equity compensation plans include grants of incentive and nonqualified stock options, performance share units (“PSUs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), and deferred stock units (“DSUs”), to employees, executive officers, and non-employee directors.

We also provide an employee stock purchase plan (“ESPP”) and 401(k) match to eligible participants.

We recognize stock-based compensation expense based on grant date award fair value.

This cost is recognized over the period for which the employee is required to provide service in exchange for the award or the award performance period, except for expenses relating to retirement-eligible employees.

If retirement-eligible employees have not given their required notice, expense is recognized on a pro-rata basis over the notice period prior to retirement;

if they have given their notice, expense is recognized over the notice period;

if they have given their notice and completed the notice period, expense is recognized upon grant.

At September 30, 2024, there were 12.3 million shares available for grant under approved equity compensation plans.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

At March 31, 2025, there were 11.9 million shares available for grant under approved equity compensation plans.

Stock-based compensation expense was allocated in the condensed consolidated statements of comprehensive income as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

7 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

2 unchanged sentences

RSUs & DSUs 8,633 15,491

RSAs 112 122 329 345

ESPP 800 637 2,323 1,974

401(k) stock match 729 738

$ 13,867 $ 20,018

As of September 30, 2024, there was $ 78.9 million of unrecognized stock-based compensation expense under our equity compensation plans, which is expected to be recognized on a primarily straight-line basis over a weighted average period of 2.5 years.

As of March 31, 2025, there was $ 102.3 million of unrecognized stock-based compensation expense under our equity compensation plans, which is expected to be recognized on a primarily straight-line basis over a weighted average period of 2.6 years.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

Stock Options

Our stock option activity was as follows:

Nine Months Ended

September 30, 2024

Three Months Ended

March 31, 2025

Options (#) Weighted Average

5 unchanged sentences

Outstanding, end of period 320,840 $ 112.12

Of the total outstanding options at September 30, 2024, 0.2 million were exercisable.

Of the total outstanding options at March 31, 2025, 0.2 million were exercisable.

The outstanding and exercisable options had a weighted average exercise price of $ 94.29 per share and a weighted average remaining contractual life of 2.7 years.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

The weighted average grant date fair value of options granted during the nine months ended September 30, 2024 was $ 69.82 per share.

The weighted average grant date fair value of options granted during the three months ended March 31, 2025 was $ 50.56 per share.

This was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions:

9 unchanged sentences

Activity for our PSUs, RSUs, RSAs, and DSUs in aggregate was as follows:

Nine Months Ended

September 30, 2024

Three Months Ended

March 31, 2025

# Weighted Average Grant

5 unchanged sentences

Outstanding, end of period 802,272 $ 178.37

The number of PSUs, RSUs, RSAs, and DSUs outstanding at September 30, 2024 included less than 0.1 million units that have vested, but the shares of common stock have not yet been issued, pursuant to the terms of the underlying agreements.

The number of PSUs, RSUs, RSAs, and DSUs outstanding at March 31, 2025 included less than 0.1 million units that have vested, but the shares of common stock have not yet been issued, pursuant to the terms of the underlying agreements.

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

Employee Stock Purchase Plan

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except shares) 2025 2024

1 unchanged sentence

Shares purchased 2,630 2,398

A total of 1.6 million shares of common stock are reserved for issuance under the plan at September 30, 2024.

A total of 1.6 million shares of common stock are reserved for issuance under the ESPP at March 31, 2025.

The fair value was estimated based on the market price of our common stock at the beginning of the offering period using the following assumptions:

3 unchanged sentences

Risk-free interest rate 5.4 %

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

NOTE L – Income Taxes

6 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

Investment income $ 1,849 $ 2,879

Realized gain from foreign currency on cash and investments held 1,077 98 2,636 525

Realized gain from investments held and foreign currency impact on cash and investments 366 304

Other expense, net ( 8 ) ( 51 )

Total other income, net $ 2,207 $ 3,132

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended March 31, 2025

NOTE N – Net Income Per Share

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except per share amounts) 2025 2024

9 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024

1 unchanged sentence

SPS COMMERCE, INC.

Form 10-Q for the Quarterly Period ended September 30, 2024

Form 10-Q for the Quarterly Period ended March 31, 2025

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements