0001092699-24-000074 | 10-Q | XBRL Viewer

Goodwill and Intangible Assets, Net

9 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The activity in goodwill was as follows:


(in thousands)	Nine Months Ended September 30, 2024
Balance, beginning of period	$	249,176
Addition from business acquisitions	173,164
Foreign currency translation	(649)
Remeasurement from provisional purchase accounting amount	1,817
Balance, end of period	$	423,508

Intangible Assets

Intangible assets, net consisted of the following:


	September 30, 2024
($ in thousands)	Gross Carrying Amount		Accumulated Amortization		Foreign Currency Translation		Net		Weighted Average Remaining Amortization Period
Subscriber relationships	$	126,423	$	(41,513)	$	(138)	$	84,772	6.2 years
Developed technology	105,518		(22,151)		(8)		83,359		6.6 years
	$	231,941	$	(63,664)	$	(146)	$	168,131	6.4 years


	December 31, 2023
($ in thousands)	Gross Carrying Amount		Accumulated Amortization		Foreign Currency Translation		Net		Weighted Average Remaining Amortization Period
Subscriber relationships	$	105,228	$	(32,097)	$	724	$	73,855	6.6 years
Developed technology	48,843		(15,669)		315		33,489		5.0 years
	$	154,071	$	(47,766)	$	1,039	$	107,344	6.1 years

The estimated future annual amortization expense related to intangible assets is as follows:


(in thousands)
Remainder of 2024	$	7,231
2025	28,792
2026	27,788
2027	27,314
2028	25,974
Thereafter	51,032
Total future amortization	$	168,131

General (Policies)

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

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.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of SPS Commerce, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements.

This interim financial information has been prepared under the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these condensed consolidated financial statements do not include all of the information and notes required by GAAP. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the Securities and Exchange Commission (“SEC”). We have included all normal recurring adjustments considered necessary to provide a fair presentation of our financial position, results of operations, stockholders’ equity, and cash flows for the interim periods presented. Operating results for these interim periods are not necessarily indicative of the results to be expected for the full year.

Use of Estimates

Preparing financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

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.

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

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

Commitments and Contingencies - Summary of Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$ 3,801	$ 3,835
Right-of-use assets obtained in exchange for operating lease liabilities	$ 2,554	$ 1,072

Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended				9 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Mar. 31, 2022	Mar. 31, 2021	Sep. 30, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant (in shares)					12.3
Unrecognized stock-based compensation expense					$ 78.9
Unrecognized stock-based compensation, expected to be recognized, weighted average period					2 years 6 months
Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares)					1.6
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding and exercisable options (in shares)					0.2
Weighted average exercise price (in dollars per share)					$ 83.65
Weighted average remaining contractual life					3 years
Weighted average fair value per share of options granted (in dollars per share)					$ 69.82
PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years	3 years	3 years	3 years
PSUs \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares)	0.1
PSUs, RSUs, RSAs and DSUs \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vested number of units (less than) (in shares)					0.1

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands	Total	Common Stock	Treasury Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Gain (Loss)
Beginning balance (in shares) at Dec. 31, 2022		36,158,046
Beginning balance at Dec. 31, 2022	$ 537,073	$ 38	$ (128,892)	$ 476,117	$ 193,221	$ (3,411)
Beginning balance (in shares) at Dec. 31, 2022			2,151,098
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	34,192			34,192
Shares issued pursuant to stock awards (in shares)		496,500
Shares issued pursuant to stock awards	5,524	$ 1		5,523
Employee stock purchase plan activity (in shares)		41,384
Employee stock purchase plan activity	$ 4,481			4,481
Repurchases of common stock, net of costs (in shares)	0
Repurchases of common stock, net of costs	$ 0
Net income	46,813				46,813
Foreign currency translation adjustments	(1,446)					(1,446)
Unrealized gain on investments, net of tax	1,376					1,376
Reclassification of gain on investments into earnings, net of tax	(1,169)					(1,169)
Ending balance (in shares) at Sep. 30, 2023		36,695,930
Ending balance at Sep. 30, 2023	626,844	$ 39	$ (128,892)	520,313	240,034	(4,650)
Ending balance (in shares) at Sep. 30, 2023			2,151,098
Beginning balance (in shares) at Jun. 30, 2023		36,646,819
Beginning balance at Jun. 30, 2023	600,981	$ 39	$ (128,892)	508,484	223,192	(1,842)
Beginning balance (in shares) at Jun. 30, 2023			2,151,098
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	10,780			10,780
Shares issued pursuant to stock awards (in shares)		45,952
Shares issued pursuant to stock awards	705			705
Employee stock purchase plan activity (in shares)		3,159
Employee stock purchase plan activity	$ 344			344
Repurchases of common stock, net of costs (in shares)	0
Repurchases of common stock, net of costs	$ 0
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)
Ending balance (in shares) at Sep. 30, 2023		36,695,930
Ending balance at Sep. 30, 2023	$ 626,844	$ 39	$ (128,892)	520,313	240,034	(4,650)
Ending balance (in shares) at Sep. 30, 2023			2,151,098
Beginning balance (in shares) at Dec. 31, 2023	36,820,048	36,820,048
Beginning balance at Dec. 31, 2023	$ 667,475	$ 39	$ (128,892)	537,061	259,045	222
Beginning balance (in shares) at Dec. 31, 2023	2,151,098		2,151,098
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	$ 40,075			40,075
Shares issued pursuant to stock awards (in shares)		488,849
Shares issued pursuant to stock awards	4,198			4,198
Employee stock purchase plan activity (in shares)		35,416
Employee stock purchase plan activity	$ 5,672			5,672
Repurchases of common stock, net of costs (in shares)	205,331	(205,331)	205,331
Repurchases of common stock, net of costs	$ (37,567)		$ (37,567)
Reissuances of treasury stock (in shares)		427,461	(427,461)
Reissuances of treasury stock	91,424		$ 66,711	24,713
Net income	59,495				59,495
Foreign currency translation adjustments	(886)					(886)
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)
Ending balance (in shares) at Sep. 30, 2024	37,566,443	37,566,443
Ending balance at Sep. 30, 2024	$ 829,365	$ 39	$ (99,748)	611,719	318,540	(1,185)
Ending balance (in shares) at Sep. 30, 2024	1,928,968		1,928,968
Beginning balance (in shares) at Jun. 30, 2024		37,086,627
Beginning balance at Jun. 30, 2024	$ 703,421	$ 39	$ (162,187)	574,842	295,080	(4,353)
Beginning balance (in shares) at Jun. 30, 2024			2,333,099
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	9,996			9,996
Shares issued pursuant to stock awards (in shares)		72,852
Shares issued pursuant to stock awards	1,884			1,884
Employee stock purchase plan activity (in shares)		2,833
Employee stock purchase plan activity	$ 453			453
Repurchases of common stock, net of costs (in shares)	456	(456)	456
Repurchases of common stock, net of costs	$ (84)		$ (84)
Reissuances of treasury stock (in shares)		404,587	(404,587)
Reissuances of treasury stock	87,067		$ 62,523	24,544
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)
Ending balance (in shares) at Sep. 30, 2024	37,566,443	37,566,443
Ending balance at Sep. 30, 2024	$ 829,365	$ 39	$ (99,748)	$ 611,719	$ 318,540	$ (1,185)
Ending balance (in shares) at Sep. 30, 2024	1,928,968		1,928,968

Net Income Per Share

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Net Income Per Share

The components and computation of basic and diluted net income per share were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share amounts)	2024		2023		2024		2023
Numerator
Net income	$	23,460	$	16,842	$	59,495	$	46,813
Denominator
Weighted average common shares outstanding, basic	37,447		36,728		37,192		36,584
Options to purchase common stock and ESPP	145		256		159		279
PSUs, RSUs, RSAs, and DSUs	404		600		434		554
Weighted average common shares outstanding, diluted	37,996		37,584		37,785		37,417
Net income per share
Basic	$	0.63	$	0.46	$	1.60	$	1.28
Diluted	$	0.62	$	0.45	$	1.57	$	1.25

The number of outstanding potential common shares that were excluded from the calculation of diluted net income per share as they were anti-dilutive was as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(in thousands)	2024	2023	2024	2023
Anti-dilutive shares	130	40	118	43

Commitments and Contingencies - Summary of Supplemental Balance Sheet Information Related to Leases (Details)	Sep. 30, 2024	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Weighted-average remaining lease term	2 years 7 months 6 days	3 years 1 month 6 days
Weighted-average discount rate	4.20%	4.00%

Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2024

Equity [Abstract]

Schedule of Repurchase Agreements

Details of the programs and activity thereunder through September 30, 2024 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
2022 Program	August 2022	July 2024	$	50,000	$	40,556	$	9,444	N/A
2024 Program	August 2024	July 2026	100,000		—		N/A		$	100,000

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)	2024		2023		2024		2023
Number of shares repurchased	456		—		205,331		—
Total share repurchased cost	$	84	$	—	$	37,567	$	—
Average total cost per repurchased share	$	184.21	$	—	$	182.96	$	—

Net Income Per Share - Components and Computation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Numerator
Net income	$ 23,460	$ 16,842	$ 59,495	$ 46,813
Denominator
Weighted average common shares outstanding, basic (in shares)	37,447	36,728	37,192	36,584
Options to purchase common stock and ESPP (in shares)	145	256	159	279
PSUs, RSUs, RSAs, and DSUs (in shares)	404	600	434	554
Weighted average common shares outstanding, diluted (in shares)	37,996	37,584	37,785	37,417
Net income per share
Basic (in dollars per share)	$ 0.63	$ 0.46	$ 1.60	$ 1.28
Diluted (in dollars per share)	$ 0.62	$ 0.45	$ 1.57	$ 1.25

Stock-Based Compensation - PSU, RSU, RSA, and DSU (Details) - PSUs, RSUs, RSAs and DSUs	9 Months Ended
	Sep. 30, 2024 $ / shares shares
#
Beginning balance (in shares) \| shares	773,414
Granted (in shares) \| shares	409,843
Vested and common stock issued (in shares) \| shares	(403,291)
Forfeited (in shares) \| shares	(33,725)
Ending balance (in shares) \| shares	746,241
Weighted Average Grant Date Fair Value ($/share)
Beginning balance (in dollars per share) \| $ / shares	$ 147.50
Granted (in dollars per share) \| $ / shares	185.73
Vested and common stock issued (in dollars per share) \| $ / shares	124.30
Forfeited (in dollars per share) \| $ / shares	180.49
Ending balance (in dollars per share) \| $ / shares	$ 179.54

Stock-Based Compensation

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

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. 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.

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)	2024		2023		2024		2023
Cost of revenues	$	1,412	$	2,506	$	8,224	$	7,595
Operating expenses
Sales and marketing	2,820		2,428		9,776		7,379
Research and development	1,939		1,798		7,001		5,387
General and administrative	4,581		4,704		17,263		15,736
	$	10,752	$	11,436	$	42,264	$	36,097

Stock-based compensation expense by grant type or plan was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Stock options	$	514	$	487	$	1,517	$	1,472
PSUs	2,260		2,812		7,149		10,236
RSUs & DSUs	6,309		6,722		28,751		20,165
RSAs	112		122		329		345
ESPP	800		637		2,323		1,974
401(k) stock match	757		656		2,195		1,905
	$	10,752	$	11,436	$	42,264	$	36,097

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.

Stock Options

Our stock option activity was as follows:


	Nine Months Ended September 30, 2024
	Options (#)	Weighted Average Exercise Price ($/share)
Outstanding, beginning of period	346,822	$	80.02
Granted	36,993	197.42
Exercised	(85,364)	49.18
Forfeited	(2,094)	158.63
Outstanding, end of period	296,357	$	103.01

Of the total outstanding options at September 30, 2024, 0.2 million were exercisable. The outstanding and exercisable options had a weighted average exercise price of $83.65 per share and a weighted average remaining contractual life of 3.0 years.

The weighted average grant date fair value of options granted during the nine months ended September 30, 2024 was $69.82 per share. This was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:


Life (in years)	4.1
Volatility	36.7	%
Dividend yield	—
Risk-free interest rate	4.3	%

Performance Share Units, Restricted Stock Units and Awards, and Deferred Stock Units

In each of the quarters ended March 31, 2024, 2023, 2022, and 2021 we granted PSU awards with a target performance level. These awards are earned based upon our Company’s total shareholder return as compared to an indexed total shareholder return over the course of a fiscal based three-year performance period, starting in the year of grant. Earned awards vest in the quarter following the conclusion of the performance period. In the three months ended March 31, 2024, PSU awards granted in 2021 vested at the maximum performance level and 0.1 million shares of common stock were issued.

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


	Nine Months Ended September 30, 2024
	#	Weighted Average Grant Date Fair Value ($/share)
Outstanding, beginning of period	773,414	$	147.50
Granted	409,843	185.73
Vested and common stock issued	(403,291)	124.30
Forfeited	(33,725)	180.49
Outstanding, end of period	746,241	$	179.54

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.

Employee Stock Purchase Plan

Our ESPP activity was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except shares)	2024		2023		2024		2023
Amounts for shares purchased	$	453	$	344	$	5,672	$	4,481
Shares purchased	2,833		3,159		35,416		41,384

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

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:


Life (in years)	0.5
Volatility	30.9	%
Dividend yield	—
Risk-free interest rate	5.3	%

Revenue - Summary of Revenues by Revenue Stream (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue Recognition [Line Items]
Total revenue	$ 163,686	$ 135,661	$ 466,858	$ 391,945
Recurring revenues
Revenue Recognition [Line Items]
Total revenue	154,456	127,371	438,122	366,195
One-time revenues
Revenue Recognition [Line Items]
Total revenue	9,230	8,290	28,736	25,750
Fulfillment \| Recurring revenues
Revenue Recognition [Line Items]
Total revenue	135,290	110,900	382,654	318,069
Analytics \| Recurring revenues
Revenue Recognition [Line Items]
Total revenue	13,838	13,098	41,361	38,177
Other \| Recurring revenues
Revenue Recognition [Line Items]
Total revenue	$ 5,328	$ 3,373	$ 14,107	$ 9,949

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

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-Paragraph 41
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-42

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-4

+ Details

Stock-Based Compensation - Summary of ESPP Activity (Details) - Employee Stock Purchase Plan - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Amounts for shares purchased	$ 453	$ 344	$ 5,672	$ 4,481
Shares purchased (in shares)	2,833	3,159	35,416	41,384

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 1D
-Publisher FASB
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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Reference 25: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Property and Equipment, Net

9 Months Ended

Sep. 30, 2024

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

Property and equipment, net consisted of the following:


(in thousands)	September 30, 2024		December 31, 2023
Internally developed software	$	69,727	$	60,396
Computer equipment	35,904		34,402
Leasehold improvements	15,381		15,387
Office equipment and furniture	10,980		10,966
Property and equipment, cost	131,992		121,151
Less: accumulated depreciation and amortization	(95,844)		(85,108)
Total property and equipment, net	$	36,148	$	36,043

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


	September 30, 2024		December 31, 2023
International property and equipment	18	%	15	%

Commitments and Contingencies - Summary of Components of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Operating lease cost	$ 884	$ 729	$ 2,496	$ 2,306
Variable lease cost	824	909	2,743	2,787
Total lease expense	$ 1,708	$ 1,638	$ 5,239	$ 5,093

Allowance for Credit Losses (Tables)

9 Months Ended

Sep. 30, 2024

Allowance for Credit Loss [Abstract]

Summary of Allowance for Credit Losses Activity Included in Accounts Receivable Net

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


	Nine Months Ended September 30,
(in thousands)	2024		2023
Balance, beginning of period	$	3,320	$	3,066
Provision for credit losses	6,239		4,004
Write-offs, net of recoveries	(5,085)		(3,993)
Balance, end of period	$	4,474	$	3,077

Revenue (Tables)

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Summary of Revenues by Revenue Stream

We derive our revenues from the following revenue streams:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Recurring revenues:
Fulfillment	$	135,290	$	110,900	$	382,654	$	318,069
Analytics	13,838		13,098		41,361		38,177
Other	5,328		3,373		14,107		9,949
Recurring revenues	154,456		127,371		438,122		366,195
One-time revenues	9,230		8,290		28,736		25,750
Total revenue	$	163,686	$	135,661	$	466,858	$	391,945

Summary of Percentage of Domestic Revenue

Domestic revenue, which we define as revenue that was attributable to customers based within the United States ("U.S."), was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Domestic revenue	83	%	84	%	83	%	84	%

Summary of Deferred Revenue Liability Relating to Set-Up Fees

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.


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Balance, beginning of period	$	18,360	$	16,978	$	17,603	$	14,999
Invoiced set-up fees	3,866		4,496		13,387		14,493
Recognized set-up fees	(4,519)		(4,225)		(13,283)		(12,243)
Balance, end of period	$	17,707	$	17,249	$	17,707	$	17,249

Business Acquisitions

9 Months Ended

Sep. 30, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

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. We will finalize the allocation of the purchase price within the one-year measurement period following the acquisition. The goodwill associated with the acquisition is not deductible for income tax purposes.

Purchase Price Allocation

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:
Cash	$	6,118
Other assets	3,659
Intangible assets
Subscriber relationships	16,500
Developed technology	49,500
Deferred revenue	(2,297)
Other liabilities	(2,643)
Deferred income tax liabilities, net	(11,580)
Total fair value of assets and liabilities acquired	$	59,257

Goodwill	$	152,668

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


			Useful Life
Subscriber relationships			7.0 years
Developed technology			8.0 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 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.

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.

Revenue - Summary of Deferred Revenue Liability Relating to Set-Up Fees (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue recognition	$ 13,500		$ 13,500
Set-Up Fees
Deferred Revenue Arrangement [Roll Forward]
Balance, beginning of period	18,360	$ 16,978	17,603	$ 14,999
Invoiced set-up fees	3,866	4,496	13,387	14,493
Recognized set-up fees	(4,519)	(4,225)	(13,283)	(12,243)
Balance, end of period	$ 17,707	$ 17,249	$ 17,707	$ 17,249

Stock-Based Compensation - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 10,752	$ 11,436	$ 42,264	$ 36,097
Stock options
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	514	487	1,517	1,472
PSUs
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	2,260	2,812	7,149	10,236
RSUs & DSUs
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	6,309	6,722	28,751	20,165
RSAs
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	112	122	329	345
ESPP
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	800	637	2,323	1,974
401(k) stock match
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	757	656	2,195	1,905
Cost of revenues
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	1,412	2,506	8,224	7,595
Sales and marketing
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	2,820	2,428	9,776	7,379
Research and development
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	1,939	1,798	7,001	5,387
General and administrative
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 4,581	$ 4,704	$ 17,263	$ 15,736

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Summary of Stock-Based Compensation Expense

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)	2024		2023		2024		2023
Cost of revenues	$	1,412	$	2,506	$	8,224	$	7,595
Operating expenses
Sales and marketing	2,820		2,428		9,776		7,379
Research and development	1,939		1,798		7,001		5,387
General and administrative	4,581		4,704		17,263		15,736
	$	10,752	$	11,436	$	42,264	$	36,097

Stock-based compensation expense by grant type or plan was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Stock options	$	514	$	487	$	1,517	$	1,472
PSUs	2,260		2,812		7,149		10,236
RSUs & DSUs	6,309		6,722		28,751		20,165
RSAs	112		122		329		345
ESPP	800		637		2,323		1,974
401(k) stock match	757		656		2,195		1,905
	$	10,752	$	11,436	$	42,264	$	36,097

Summary of Stock Option Activity

Our stock option activity was as follows:


	Nine Months Ended September 30, 2024
	Options (#)	Weighted Average Exercise Price ($/share)
Outstanding, beginning of period	346,822	$	80.02
Granted	36,993	197.42
Exercised	(85,364)	49.18
Forfeited	(2,094)	158.63
Outstanding, end of period	296,357	$	103.01

Summary of Weighted Average Fair Value Per Share of Options Granted, Assumptions

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


Life (in years)	4.1
Volatility	36.7	%
Dividend yield	—
Risk-free interest rate	4.3	%

Summary of PSU, RSU, RSA, and DSU

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


	Nine Months Ended September 30, 2024
	#	Weighted Average Grant Date Fair Value ($/share)
Outstanding, beginning of period	773,414	$	147.50
Granted	409,843	185.73
Vested and common stock issued	(403,291)	124.30
Forfeited	(33,725)	180.49
Outstanding, end of period	746,241	$	179.54

Summary of ESPP Activity

Our ESPP activity was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except shares)	2024		2023		2024		2023
Amounts for shares purchased	$	453	$	344	$	5,672	$	4,481
Shares purchased	2,833		3,159		35,416		41,384

Summary of Fair Value Estimation of Common Stock, Assumptions

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:


Life (in years)	0.5
Volatility	30.9	%
Dividend yield	—
Risk-free interest rate	5.3	%

Revenue - Summary of Percentage of Domestic Revenue (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue Benchmark \| Geographic Concentration Risk \| Domestic revenue
Disaggregation Of Revenue [Line Items]
Concentration risk, percentage	83.00%	84.00%	83.00%	84.00%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

Deferred Costs (Tables)

9 Months Ended

Sep. 30, 2024

Deferred Costs [Abstract]

Summary of Deferred Costs Activity

The deferred costs activity was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Balance, beginning of period	$	84,928	$	75,255	$	82,750	$	70,179
Incurred deferred costs	22,532		20,094		67,483		57,632
Amortized deferred costs	(21,993)		(16,303)		(64,766)		(48,765)
Balance, end of period	$	85,467	$	79,046	$	85,467	$	79,046

Fair Value Measurements

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

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
(in thousands)
Cash equivalents:
Money market funds	Level 1	$	135,700	$	—	$	135,700	Level 1	$	161,233	$	—	$	161,233
Investments:
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

Property and Equipment, Net (Tables)

9 Months Ended

Sep. 30, 2024

Property, Plant and Equipment [Abstract]

Summary of Property and Equipment, Net

Property and equipment, net consisted of the following:


(in thousands)	September 30, 2024		December 31, 2023
Internally developed software	$	69,727	$	60,396
Computer equipment	35,904		34,402
Leasehold improvements	15,381		15,387
Office equipment and furniture	10,980		10,966
Property and equipment, cost	131,992		121,151
Less: accumulated depreciation and amortization	(95,844)		(85,108)
Total property and equipment, net	$	36,148	$	36,043

Summary of Percentage of Property and Equipment Net Located at Subsidiary and Office Locations Outside of United States

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


	September 30, 2024		December 31, 2023
International property and equipment	18	%	15	%

Property and Equipment, Net - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property and equipment, cost	$ 131,992	$ 121,151
Less: accumulated depreciation and amortization	(95,844)	(85,108)
Total property and equipment, net	36,148	36,043
Internally developed software
Property, Plant and Equipment [Line Items]
Property and equipment, cost	69,727	60,396
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment, cost	35,904	34,402
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, cost	15,381	15,387
Office equipment and furniture
Property, Plant and Equipment [Line Items]
Property and equipment, cost	$ 10,980	$ 10,966

Stockholders' Equity - Summary of Stock Repurchase Activity by Period (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Equity [Abstract]
Number of shares repurchased (in shares)	456	0	205,331	0
Total share repurchased cost	$ 84	$ 0	$ 37,567	$ 0
Average total cost per repurchased share (in dollars per share)	$ 184.21	$ 0	$ 182.96	$ 0

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net income	$ 23,460	$ 16,842	$ 59,495	$ 46,813

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	110,000,000	110,000,000
Common stock, shares issued (in shares)	39,495,411	38,971,146
Common stock, shares outstanding (in shares)	37,566,443	36,820,048
Treasury stock, at cost (in shares)	1,928,968	2,151,098

Goodwill and Intangible Assets, Net - Summary of Intangible Assets, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 231,941	$ 154,071
Accumulated Amortization	(63,664)	(47,766)
Foreign Currency Translation	(146)	1,039
Total future amortization	$ 168,131	$ 107,344
Weighted Average Remaining Amortization Period	6 years 4 months 24 days	6 years 1 month 6 days
Subscriber relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 126,423	$ 105,228
Accumulated Amortization	(41,513)	(32,097)
Foreign Currency Translation	(138)	724
Total future amortization	$ 84,772	$ 73,855
Weighted Average Remaining Amortization Period	6 years 2 months 12 days	6 years 7 months 6 days
Developed technology
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 105,518	$ 48,843
Accumulated Amortization	(22,151)	(15,669)
Foreign Currency Translation	(8)	315
Total future amortization	$ 83,359	$ 33,489
Weighted Average Remaining Amortization Period	6 years 7 months 6 days	5 years

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Statement [Abstract]
Revenues	$ 163,686	$ 135,661	$ 466,858	$ 391,945
Cost of revenues	51,624	45,521	155,129	133,029
Gross profit	112,062	90,140	311,729	258,916
Operating expenses
Sales and marketing	37,577	30,289	109,700	89,722
Research and development	15,292	13,558	45,667	39,438
General and administrative	27,152	21,906	76,575	64,275
Amortization of intangible assets	6,470	3,788	15,648	11,118
Total operating expenses	86,491	69,541	247,590	204,553
Income from operations	25,571	20,599	64,139	54,363
Other income, net	3,778	1,702	10,966	4,859
Income before income taxes	29,349	22,301	75,105	59,222
Income tax expense	5,889	5,459	15,610	12,409
Net income	23,460	16,842	59,495	46,813
Other comprehensive income (expense)
Foreign currency translation adjustments	3,332	(2,966)	(886)	(1,446)
Unrealized gain on investments, net of tax of $28, $190, $363 and $459, respectively	84	570	1,089	1,376
Reclassification of gain on investments into earnings, net of tax of $(83), $(137), $(537) and $(390), respectively	(248)	(412)	(1,610)	(1,169)
Total other comprehensive income (expense)	3,168	(2,808)	(1,407)	(1,239)
Comprehensive income	$ 26,628	$ 14,034	$ 58,088	$ 45,574
Net income per share
Basic (in dollars per share)	$ 0.63	$ 0.46	$ 1.60	$ 1.28
Diluted (in dollars per share)	$ 0.62	$ 0.45	$ 1.57	$ 1.25
Weighted average common shares used to compute net income per share
Basic (in shares)	37,447	36,728	37,192	36,584
Diluted (in shares)	37,996	37,584	37,785	37,417

Allowance for Credit Losses - Summary of Allowance for Credit Losses Activity (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance, beginning of period	$ 3,320	$ 3,066
Provision for credit losses	6,239	4,004
Write-offs, net of recoveries	(5,085)	(3,993)
Balance, end of period	$ 4,474	$ 3,077

Goodwill and Intangible Assets, Net (Tables)

9 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Activity in Goodwill

The activity in goodwill was as follows:


(in thousands)	Nine Months Ended September 30, 2024
Balance, beginning of period	$	249,176
Addition from business acquisitions	173,164
Foreign currency translation	(649)
Remeasurement from provisional purchase accounting amount	1,817
Balance, end of period	$	423,508

Summary of Intangible Assets, Net

Intangible assets, net consisted of the following:


	September 30, 2024
($ in thousands)	Gross Carrying Amount		Accumulated Amortization		Foreign Currency Translation		Net		Weighted Average Remaining Amortization Period
Subscriber relationships	$	126,423	$	(41,513)	$	(138)	$	84,772	6.2 years
Developed technology	105,518		(22,151)		(8)		83,359		6.6 years
	$	231,941	$	(63,664)	$	(146)	$	168,131	6.4 years


	December 31, 2023
($ in thousands)	Gross Carrying Amount		Accumulated Amortization		Foreign Currency Translation		Net		Weighted Average Remaining Amortization Period
Subscriber relationships	$	105,228	$	(32,097)	$	724	$	73,855	6.6 years
Developed technology	48,843		(15,669)		315		33,489		5.0 years
	$	154,071	$	(47,766)	$	1,039	$	107,344	6.1 years

Summary of Estimated Annual Amortization Expense Related to Intangible Assets

The estimated future annual amortization expense related to intangible assets is as follows:


(in thousands)
Remainder of 2024	$	7,231
2025	28,792
2026	27,788
2027	27,314
2028	25,974
Thereafter	51,032
Total future amortization	$	168,131

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 55
-Paragraph 24
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482548/350-20-55-24

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+ Details

Stock-Based Compensation - Weighted Average Grant Date Fair Value of Options Granted, Assumptions (Details) - Stock options	9 Months Ended
	Sep. 30, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Life (in years)	4 years 1 month 6 days
Volatility	36.70%
Dividend yield	0.00%
Risk-free interest rate	4.30%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Net Income Per Share (Tables)

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Summary of Components and Computation of Basic and Diluted Net Income Per Share

The components and computation of basic and diluted net income per share were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share amounts)	2024		2023		2024		2023
Numerator
Net income	$	23,460	$	16,842	$	59,495	$	46,813
Denominator
Weighted average common shares outstanding, basic	37,447		36,728		37,192		36,584
Options to purchase common stock and ESPP	145		256		159		279
PSUs, RSUs, RSAs, and DSUs	404		600		434		554
Weighted average common shares outstanding, diluted	37,996		37,584		37,785		37,417
Net income per share
Basic	$	0.63	$	0.46	$	1.60	$	1.28
Diluted	$	0.62	$	0.45	$	1.57	$	1.25

Summary of Anti-dilutive Common Shares Excluded from Calculation of Diluted Net Income Per Share

The number of outstanding potential common shares that were excluded from the calculation of diluted net income per share as they were anti-dilutive was as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(in thousands)	2024	2023	2024	2023
Anti-dilutive shares	130	40	118	43

Goodwill and Intangible Assets, Net - Summary of Activity in Goodwill (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2024 USD ($)
Goodwill [Roll Forward]
Balance, beginning of period	$ 249,176
Addition from business acquisitions	173,164
Foreign currency translation	(649)
Remeasurement from provisional purchase accounting amount	1,817
Balance, end of period	$ 423,508

- Definition

Amount, after accumulated impairment loss, of asset representing future economic benefit arising from other asset acquired in business combination or from joint venture formation or both, that is not individually identified and separately recognized.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 49
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-URI https://asc.fasb.org/1943274/2147482785/280-10-55-49

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Reference 3: http://www.xbrl.org/2003/role/exampleRef
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Reference 4: http://www.xbrl.org/2003/role/exampleRef
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-Name Accounting Standards Codification
-Section 45
-Paragraph 1
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-URI https://asc.fasb.org/1943274/2147482598/350-20-45-1

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
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-Paragraph 1
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-Topic 350
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-Paragraph 1
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1
-Subparagraph (SX 210.9-03(10)(1))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147478546/942-210-S99-1

+ Details

COVER - shares	9 Months Ended
COVER - shares	Sep. 30, 2024	Oct. 17, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2024
Document Transition Report	false
Entity File Number	001-34702
Entity Registrant Name	SPS COMMERCE, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	41-2015127
Entity Address, Address Line One	333 South Seventh Street
Entity Address, Address Line Two	Suite 1000
Entity Address, City or Town	Minneapolis
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55402
City Area Code	612
Local Phone Number	435-9400
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	SPSC
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		37,568,061
Entity Central Index Key	0001092699
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Amendment Flag	false

Other Income and Expense

9 Months Ended

Sep. 30, 2024

Other Income and Expenses [Abstract]

Other Income and Expense

Other income, net included the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Investment income	$	2,704	$	2,635	$	8,377	$	5,372
Realized gain from foreign currency on cash and investments held	1,077		98		2,636		525
Other expense, net	(3)		(1,031)		(47)		(1,038)
Total other income, net	$	3,778	$	1,702	$	10,966	$	4,859

Commitments and Contingencies

9 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Leases

The components of lease expense were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Operating lease cost	$	884	$	729	$	2,496	$	2,306
Variable lease cost	824		909		2,743		2,787
	$	1,708	$	1,638	$	5,239	$	5,093

Supplemental cash flow information related to leases was as follows:


	Nine Months Ended September 30,
(in thousands)	2024		2023
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$	3,801	$	3,835
Right-of-use assets obtained in exchange for operating lease liabilities	2,554		1,072

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


	September 30, 2024		December 31, 2023
Weighted-average remaining lease term	2.6 years		3.1 years
Weighted-average discount rate	4.2	%	4.0	%

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


(in thousands)
Remainder of 2024	$	1,716
2025	5,460
2026	4,784
2027	1,740


Thereafter	240
Total future gross payments	$	13,940
Less: imputed interest	(770)
Total operating lease liabilities	$	13,170

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:


(in thousands)
Remainder of 2024	$	2,890
2025	14,187
2026	4,692



Total estimated future purchases	$	21,769

Insider Trading Arrangements

3 Months Ended

9 Months Ended

Sep. 30, 2024

Trading Arrangements, by Individual

Material Terms of Trading Arrangement

During the three months ended September 30, 2024, the following directors and officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted written plans for the sale of our securities that are intended to satisfy the affirmative defense of Rule 10b5-1(c) of the Exchange Act:

Name

Title

Adoption Date

Earliest Sale Date

Expiration or Termination Date

Aggregate Number of Shares of the Company's Common Stock to be Sold(1)

Marty Reaume

Director

August 22, 2024

January 2, 2025

May 14, 2025

7,558

Jamie Thingelstad

Chief Technology Officer

September 5, 2024

December 31, 2024

May 23, 2025

18,537

(1) The number of shares is the maximum number of shares to be sold but the actual activity may be lower. Transaction(s) may be contingent upon future events such as performance factors, tax withholding obligations, and/or future market price(s).

Non-Rule 10b5-1 Arrangement Adopted

false

Rule 10b5-1 Arrangement Terminated

false

Non-Rule 10b5-1 Arrangement Terminated

false

Marty Reaume [Member]

Trading Arrangements, by Individual

Name

Marty Reaume

Title

Director

Rule 10b5-1 Arrangement Adopted

true

August 22, 2024

May 14, 2025

265 days

7,558

Jamie Thingelstad [Member]

Trading Arrangements, by Individual

Name

Jamie Thingelstad

Title

Chief Technology Officer

Rule 10b5-1 Arrangement Adopted

true

September 5, 2024

May 23, 2025

260 days

18,537

Commitments and Contingencies - Summary of Future Minimum Payments Under Operating Leases (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Remainder of 2024	$ 1,716
2025	5,460
2026	4,784
2027	1,740
Thereafter	240
Total future gross payments	13,940
Less: imputed interest	(770)
Total operating lease liabilities	$ 13,170

Stock-Based Compensation - Fair Value Estimation of Common Stock, Assumptions (Details) - Employee Stock Purchase Plan	9 Months Ended
	Sep. 30, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Life (in years)	6 months
Volatility	30.90%
Dividend yield	0.00%
Risk-free interest rate	5.30%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash flows from operating activities
Net income	$ 59,495	$ 46,813
Reconciliation of net income to net cash provided by operating activities
Deferred income taxes	(9,918)	(11,906)
Depreciation and amortization of property and equipment	14,010	13,964
Amortization of intangible assets	15,648	11,118
Provision for credit losses	6,239	4,004
Stock-based compensation	42,264	36,097
Other, net	(925)	1,711
Changes in assets and liabilities, net of effects of acquisitions
Accounts receivable	(11,456)	(8,800)
Deferred costs	(2,240)	(7,543)
Other assets and liabilities	(2,258)	2,814
Accounts payable	665	(5,289)
Accrued compensation	458	8,073
Accrued expenses	842	(169)
Deferred revenue	5,424	10,042
Operating leases	(1,412)	(1,417)
Net cash provided by operating activities	116,836	99,512
Cash flows from investing activities
Purchases of property and equipment	(13,832)	(15,467)
Purchases of investments	(85,759)	(102,763)
Maturities of investments	136,765	95,000
Acquisition of businesses, net	(147,401)	(70,218)
Net cash used in investing activities	(110,227)	(93,448)
Cash flows from financing activities
Repurchases of common stock	(37,567)	0
Net proceeds from exercise of options to purchase common stock	4,198	5,524
Net proceeds from employee stock purchase plan activity	5,672	4,481
Net cash provided by (used in) financing activities	(27,697)	10,005
Effect of foreign currency exchange rate changes	849	(260)
Net increase (decrease) in cash and cash equivalents	(20,239)	15,809
Cash and cash equivalents at beginning of period	219,081	162,893
Cash and cash equivalents at end of period	$ 198,842	$ 178,702

Property and Equipment, Net - Summary of Percentage of Property and Equipment Net Located at Subsidiary and Office Locations Outside of United States (Details)	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
International property and equipment \| Geographic Concentration Risk \| International property and equipment
Property, Plant and Equipment [Line Items]
Concentration risk, percentage	18.00%	15.00%

Commitments and Contingencies - Summary of Remaining Purchase Commitments (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Remainder of 2024	$ 2,890
2025	14,187
2026	4,692
Total estimated future purchases	$ 21,769

Deferred Costs - Summary of Deferred Costs Activity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Deferred Costs [Roll Forward]
Balance, beginning of period	$ 84,928	$ 75,255	$ 82,750	$ 70,179
Incurred deferred costs	22,532	20,094	67,483	57,632
Amortized deferred costs	(21,993)	(16,303)	(64,766)	(48,765)
Balance, end of period	$ 85,467	$ 79,046	$ 85,467	$ 79,046

Other Income and Expense (Tables)

9 Months Ended

Sep. 30, 2024

Other Income and Expenses [Abstract]

Summary of Other Income, Net

Other income, net included the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Investment income	$	2,704	$	2,635	$	8,377	$	5,372
Realized gain from foreign currency on cash and investments held	1,077		98		2,636		525
Other expense, net	(3)		(1,031)		(47)		(1,038)
Total other income, net	$	3,778	$	1,702	$	10,966	$	4,859

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

Summary of Components of Lease Expense

The components of lease expense were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Operating lease cost	$	884	$	729	$	2,496	$	2,306
Variable lease cost	824		909		2,743		2,787
	$	1,708	$	1,638	$	5,239	$	5,093

Summary of Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information related to leases was as follows:


	Nine Months Ended September 30,
(in thousands)	2024		2023
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$	3,801	$	3,835
Right-of-use assets obtained in exchange for operating lease liabilities	2,554		1,072

Summary of Supplemental Balance Sheet Information Related to Leases

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


	September 30, 2024		December 31, 2023
Weighted-average remaining lease term	2.6 years		3.1 years
Weighted-average discount rate	4.2	%	4.0	%

Summary of Future Minimum Payments Under Operating Leases

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


(in thousands)
Remainder of 2024	$	1,716
2025	5,460
2026	4,784
2027	1,740


Thereafter	240
Total future gross payments	$	13,940
Less: imputed interest	(770)
Total operating lease liabilities	$	13,170

Summary of Remaining Purchase Commitments and Estimated Purchase Timing

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


(in thousands)
Remainder of 2024	$	2,890
2025	14,187
2026	4,692



Total estimated future purchases	$	21,769

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Current assets
Cash and cash equivalents	$ 198,842	$ 219,081
Short-term investments	6,931	56,359
Accounts receivable	60,044	50,160
Allowance for credit losses	(4,474)	(3,320)
Accounts receivable, net	55,570	46,840
Deferred costs	64,665	62,403
Other assets	18,639	16,758
Total current assets	344,647	401,441
Property and equipment, net	36,148	36,043
Operating lease right-of-use assets	8,412	7,862
Goodwill	423,508	249,176
Intangible assets, net	168,131	107,344
Other assets
Deferred costs, non-current	20,802	20,347
Deferred income tax assets	412	505
Other assets, non-current	1,240	1,126
Total assets	1,003,300	823,844
Current liabilities
Accounts payable	8,107	7,420
Accrued compensation	46,010	41,588
Accrued expenses	8,968	8,014
Deferred revenue	78,883	69,187
Operating lease liabilities	4,363	4,460
Total current liabilities	146,331	130,669
Other liabilities
Deferred revenue, non-current	6,550	6,930
Operating lease liabilities, non-current	8,807	9,569
Deferred income tax liabilities	11,607	8,972
Other liabilities, non-current	640	229
Total liabilities	173,935	156,369
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding	0	0
Common stock, $0.001 par value; 110,000,000 shares authorized; 39,495,411 and 38,971,146 shares issued; and 37,566,443 and 36,820,048 shares outstanding, respectively	39	39
Treasury stock, at cost; 1,928,968 and 2,151,098 shares, respectively	(99,748)	(128,892)
Additional paid-in capital	611,719	537,061
Retained earnings	318,540	259,045
Accumulated other comprehensive gain (loss)	(1,185)	222
Total stockholders’ equity	829,365	667,475
Total liabilities and stockholders’ equity	$ 1,003,300	$ 823,844

Revenue - Narrative (Details) - USD ($) $ in Millions	9 Months Ended
Revenue - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2024	Sep. 30, 2023
Disaggregation Of Revenue [Line Items]
Latest timing of billings	30 days
Contract term maximum	1 year
Set up fees recognized period	2 years
Maximum recognition period for miscellaneous one-time fee	1 year
Deferred revenue	$ 61.8	$ 52.4
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Disaggregation Of Revenue [Line Items]
Revenue recognition	$ 13.5
Revenue recognition period	12 months
Minimum
Disaggregation Of Revenue [Line Items]
Customer contract cancellation period	30 days
Maximum
Disaggregation Of Revenue [Line Items]
Customer contract cancellation period	90 days

Business Acquisitions - Narrative (Details) $ in Thousands, $ in Millions					9 Months Ended
	Jul. 31, 2024 USD ($) shares	May 08, 2024 USD ($) shares	Apr. 10, 2024 USD ($)	Apr. 10, 2024 CAD ($)	Sep. 30, 2024 USD ($)	Sep. 30, 2023 USD ($)	Dec. 31, 2023 USD ($)
Business Acquisition [Line Items]
Acquisition of businesses, net					$ 147,401	$ 70,218
Goodwill					$ 423,508		$ 249,176
SupplyPike, Inc.
Business Acquisition [Line Items]
Consideration transferred, net of cash acquired	$ 205,800
Acquisition of businesses, net	$ 118,600
Number of shares reissued (in shares) \| shares	404,587
Value of common stock transferred	$ 87,156
Total consideration	211,925
Cash paid	124,769
Goodwill	152,668
SupplyPike, Inc. \| Subscriber relationships
Business Acquisition [Line Items]
Intangible assets	16,500
SupplyPike, Inc. \| Developed technology
Business Acquisition [Line Items]
Intangible assets	$ 49,500
Traverse Systems
Business Acquisition [Line Items]
Number of shares reissued (in shares) \| shares		22,874
Value of common stock transferred		$ 4,400
Total consideration		29,400
Cash paid		25,000
Goodwill		18,400
Traverse Systems \| Subscriber relationships
Business Acquisition [Line Items]
Assets acquired		7,700
Traverse Systems \| Developed technology
Business Acquisition [Line Items]
Assets acquired		$ 3,600
Vision33's SAP Business One SPS Integration Technology
Business Acquisition [Line Items]
Total consideration			$ 4,300	$ 5.8
Cash paid			3,300	$ 4.5
Goodwill			$ 2,200
Business acquisition, remainder payable term			2 years	2 years
Vision33's SAP Business One SPS Integration Technology \| Subscriber relationships
Business Acquisition [Line Items]
Intangible assets			$ 400
Vision33's SAP Business One SPS Integration Technology \| Developed technology
Business Acquisition [Line Items]
Intangible assets			$ 1,700

Other Income and Expense - Summary of Other Income, Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Other Income and Expenses [Abstract]
Investment income	$ 2,704	$ 2,635	$ 8,377	$ 5,372
Realized gain from foreign currency on cash and investments held	1,077	98	2,636	525
Other expense, net	(3)	(1,031)	(47)	(1,038)
Total other income, net	$ 3,778	$ 1,702	$ 10,966	$ 4,859

Fair Value Measurements - Summary of Cash Equivalents and Investments (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Schedule of Financial Instruments [Line Items]
Amortized Cost	$ 142,631	$ 216,898
Unrealized Gains (Losses), net	0	694
Fair Value	142,631	217,592
Certificates of deposit
Schedule of Financial Instruments [Line Items]
Amortized Cost	6,931	6,805
Unrealized Gains (Losses), net	0	0
Fair Value	6,931	6,805
Cash equivalents: \| Money market funds
Schedule of Financial Instruments [Line Items]
Amortized Cost	135,700	161,233
Unrealized Gains (Losses), net	0	0
Fair Value	135,700	161,233
Marketable securities: \| Commercial paper
Schedule of Financial Instruments [Line Items]
Amortized Cost	0	48,860
Unrealized Gains (Losses), net	0	694
Fair Value	$ 0	$ 49,554

- Definition

Amount of investment in debt security measured at fair value with change in fair value recognized in other comprehensive income (available-for-sale).

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
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- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 320
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-URI https://asc.fasb.org/1943274/2147481800/320-10-50-2

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147481800/320-10-50-3

+ Details

Allowance for Credit Losses

9 Months Ended

Sep. 30, 2024

Allowance for Credit Loss [Abstract]

Allowance for Credit Losses

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


	Nine Months Ended September 30,
(in thousands)	2024		2023
Balance, beginning of period	$	3,320	$	3,066
Provision for credit losses	6,239		4,004
Write-offs, net of recoveries	(5,085)		(3,993)
Balance, end of period	$	4,474	$	3,077

Goodwill and Intangible Assets, Net - Summary of Estimated Future Annual Amortization Expense Related to Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2024	$ 7,231
2025	28,792
2026	27,788
2027	27,314
2028	25,974
Thereafter	51,032
Total future amortization	$ 168,131	$ 107,344

Stockholders' Equity - Summary of Share Repurchase Plan (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Schedule of Stockholders Equity [Line Items]
Share Value Repurchased	$ 99,748	$ 128,892
Common Stock \| 2022 Program
Schedule of Stockholders Equity [Line Items]
Share Value Authorized for Repurchase	50,000
Share Value Repurchased	40,556
Unused & Expired Share Repurchase Value	9,444
Common Stock \| 2024 Program
Schedule of Stockholders Equity [Line Items]
Share Value Authorized for Repurchase	100,000
Share Value Repurchased	0
Share Value Available for Future Repurchase	$ 100,000

Business Acquisitions (Tables)

9 Months Ended

Sep. 30, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed at Acquisition Date


(in thousands)
Cash paid	$	124,769
Equity consideration	87,156
Total consideration	$	211,925

Estimated fair value of assets and liabilities acquired:
Cash	$	6,118
Other assets	3,659
Intangible assets
Subscriber relationships	16,500
Developed technology	49,500
Deferred revenue	(2,297)
Other liabilities	(2,643)
Deferred income tax liabilities, net	(11,580)
Total fair value of assets and liabilities acquired	$	59,257

Goodwill	$	152,668

Summary of Estimated Useful Lives for each acquired Intangible Asset

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


			Useful Life
Subscriber relationships			7.0 years
Developed technology			8.0 years

Business Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed at Acquisition Date (Details) - USD ($) $ in Thousands	Jul. 31, 2024	Sep. 30, 2024	Dec. 31, 2023
Estimated fair value of assets and liabilities acquired:
Goodwill		$ 423,508	$ 249,176
SupplyPike, Inc.
Business Acquisition [Line Items]
Cash paid	$ 124,769
Equity consideration	87,156
Total consideration	211,925
Estimated fair value of assets and liabilities acquired:
Cash	6,118
Other assets	3,659
Deferred revenue	(2,297)
Other liabilities	(2,643)
Deferred income tax liabilities, net	(11,580)
Total fair value of assets and liabilities acquired	59,257
Goodwill	152,668
SupplyPike, Inc. \| Subscriber relationships
Estimated fair value of assets and liabilities acquired:
Intangible assets	16,500
SupplyPike, Inc. \| Developed technology
Estimated fair value of assets and liabilities acquired:
Intangible assets	$ 49,500

Business Acquisitions - Summary of Estimated Useful Lives for each acquired Intangible Asset (Details) - SupplyPike, Inc.	Jul. 31, 2024
Subscriber relationships
Business Acquisition [Line Items]
Intangible assets useful life	7 years
Developed technology
Business Acquisition [Line Items]
Intangible assets useful life	8 years

General

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

General

Business Description

Basis of Presentation

Use of Estimates

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.

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

December 2023

2025

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

Stock-Based Compensation - Stock Option Activity (Details)	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Options (#)
Beginning balance (in shares) \| shares	346,822
Granted (in shares) \| shares	36,993
Exercised (in shares) \| shares	(85,364)
Forfeited (in shares) \| shares	(2,094)
Ending balance (in shares) \| shares	296,357
Weighted Average Exercise Price ($/share)
Beginning balance (in dollars per share) \| $ / shares	$ 80.02
Granted (in dollars per share) \| $ / shares	197.42
Exercised (in dollars per share) \| $ / shares	49.18
Forfeited (in dollars per share) \| $ / shares	158.63
Ending balance (in dollars per share) \| $ / shares	$ 103.01

Net Income Per Share - Summary of Anti-dilutive Common Shares Excluded from Calculation of Diluted Net Income Per Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Earnings Per Share [Abstract]
Anti-dilutive shares (in shares)	130	40	118	43

General (Tables)

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Accounting Pronouncements Recently Adopted

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.

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

December 2023

2025

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

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes We record our interim provision for income taxes by applying our estimated annual effective tax rate to our year-to-date pre-tax income and adjust the provision for discrete tax items recorded in the period. Our provisions for income taxes includes current federal, state, and foreign income tax expense, as well as deferred tax expense. Differences between our effective tax rate and statutory tax rates are primarily due to the impact of permanently non-deductible expenses partially offset by the federal research and development credits and tax benefits associated with foreign-derived intangible income. Additionally, excess tax benefits generated upon settlement or exercise of stock awards are recognized as a reduction to income tax expense as a discrete tax item in the quarter that the event occurs, creating potentially significant fluctuation in tax expense by quarter and by year.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 2: http://www.xbrl.org/2003/role/exampleRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
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-Paragraph 12C
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 12B
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-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
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-URI https://asc.fasb.org/1943274/2147477891/740-270-50-1

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
-Section 50
-Paragraph 2
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482603/740-30-50-2

+ Details

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Summary of Cash Equivalents and Investments

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
(in thousands)
Cash equivalents:
Money market funds	Level 1	$	135,700	$	—	$	135,700	Level 1	$	161,233	$	—	$	161,233
Investments:
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

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Statement [Abstract]
Unrealized gain on investments, tax	$ 28	$ 190	$ 363	$ 459
Reclassification of gain on investments into earnings, tax	$ (83)	$ (137)	$ (537)	$ (390)

Revenue

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue

We derive our revenues from the following revenue streams:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Recurring revenues:
Fulfillment	$	135,290	$	110,900	$	382,654	$	318,069
Analytics	13,838		13,098		41,361		38,177
Other	5,328		3,373		14,107		9,949
Recurring revenues	154,456		127,371		438,122		366,195
One-time revenues	9,230		8,290		28,736		25,750
Total revenue	$	163,686	$	135,661	$	466,858	$	391,945

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.

Revenue by Geographic Area

Domestic revenue, which we define as revenue that was attributable to customers based within the United States ("U.S."), was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Domestic revenue	83	%	84	%	83	%	84	%

No single jurisdiction outside of the U.S. had revenues in excess of 10%.

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.

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.

One-time Revenues

One-time revenues consist of set-up fees and miscellaneous fees from customers.

Set-up revenues

Set-up fees 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. Many of our customers have connections with numerous trading partners.

Set-up fees constitute a material renewal option right that provide customers a significant future incentive that would not be otherwise available to that customer unless they entered into the contract, as the set-up fees will not be incurred again upon contract renewal. As such, set-up fees and related costs are deferred and recognized ratably generally over two years which is the estimated period for which a material right is present for our customers.


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Balance, beginning of period	$	18,360	$	16,978	$	17,603	$	14,999
Invoiced set-up fees	3,866		4,496		13,387		14,493
Recognized set-up fees	(4,519)		(4,225)		(13,283)		(12,243)
Balance, end of period	$	17,707	$	17,249	$	17,707	$	17,249

Miscellaneous one-time revenues

Miscellaneous one-time fees 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.

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.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Publisher FASB
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Section 50
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org/606/tableOfContent

+ Details

Stockholders' Equity

9 Months Ended

Sep. 30, 2024

Equity [Abstract]

Stockholders' Equity

Stockholders’ Equity

Share Repurchase Programs

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:


(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
2022 Program	August 2022	July 2024	$	50,000	$	40,556	$	9,444	N/A
2024 Program	August 2024	July 2026	100,000		—		N/A		$	100,000

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)	2024		2023		2024		2023
Number of shares repurchased	456		—		205,331		—
Total share repurchased cost	$	84	$	—	$	37,567	$	—
Average total cost per repurchased share	$	184.21	$	—	$	182.96	$	—

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.

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-URI https://asc.fasb.org/1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Subparagraph (a)
-Publisher FASB
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+ Details

Deferred Costs

9 Months Ended

Sep. 30, 2024

Deferred Costs [Abstract]

Deferred Costs

The deferred costs activity was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Balance, beginning of period	$	84,928	$	75,255	$	82,750	$	70,179
Incurred deferred costs	22,532		20,094		67,483		57,632
Amortized deferred costs	(21,993)		(16,303)		(64,766)		(48,765)
Balance, end of period	$	85,467	$	79,046	$	85,467	$	79,046