Why SPS Commerce Stock Is Crashing Today

Core Viewpoint - Shares of SPS Commerce have declined by 24% following the release of third-quarter earnings, which, despite showing a 16% increase in sales and a 23% rise in adjusted earnings per share, did not meet Wall Street's revenue expectations [1][6] Financial Performance - SPS Commerce reported a 16% increase in sales and a 23% rise in adjusted earnings per share for the third quarter [1] - The company has achieved 99 consecutive quarters of top-line growth [4] Market Reaction - The market reacted negatively to the earnings report due to sales falling short of analysts' expectations [6] - The stock is currently trading at 21 times free cash flow, close to its all-time low valuation, and is down 63% from its all-time high [5][6] Future Guidance - Management has projected organic sales growth of only 7% to 8% for 2026, which is significantly lower than the 18% annualized revenue growth rate observed over the past five years [2] Competitive Position - SPS Commerce is recognized as the leading provider in cloud-based supply chain services for retailers, third-party logistics providers, and suppliers [3] - The company emphasizes its broad adoption and unique value proposition in AI-driven data use cases [4]