SPS Commerce (SPSC) Stock Forecast & Price Target

SPS Commerce is supported by a stronger, more predictable core as management’s actions to refocus on first-party relationships and divest the 3P revenue recovery business remove a lingering growth headwind while preserving valuable retailer ties with Walmart, Amazon, Target, and others. Fundamentals also look constructive because 3Q revenue of $197.6M was broadly in line, recurring customer counts rose sequentially for the first time since 3Q25, ARPU increased 7% sequentially and 22% year over year, and Adjusted EBITDA beat consensus by $2.5M with margins reaching 35.9%. The bullish case is further reinforced by improving gross retention, expected cross-sell and enablement-driven reacceleration, and margin expansion potential from agentic onboarding and AI monetization initiatives that could extend growth momentum.

SPS Commerce is facing a deteriorating top-line outlook as management cut its full-year guide by $3M after already lowering it by about $8M in the prior quarter, reflecting both the divestiture of the 3P revenue recovery business and new Amazon policy changes. Although reported 3Q revenue was in line and profitability continues to outperform, the revenue mix shift from the take-rate model to subscription is delaying monetization, while the bigger 4Q impact from Amazon-related headwinds suggests growth is becoming less durable. Even with margin expansion and higher Non-GAAP EPS estimates of $5.10 and $5.51 for 2026 and 2027, respectively, the repeated negative revisions and ARPU pressure undermine the quality of growth and support a negative stance.