SPS Commerce, Inc.

Good afternoon and welcome to the SPS Commerce third quarter 2024 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's remarks, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note that this event is being recorded. I would now like to turn the call over to Armina Blaszczyk, Investor Relations for SPS Commerce. Please go ahead.

Thank you, Cole. Good afternoon, everyone, and thank you for joining us on SPS Commerce Third Quarter 2024 Conference Call. We will make certain statements today, including with respect to our expected financial results, go-to-market strategy, and efforts designed to increase our traction and penetration with retailers and other customers. These statements are forward-looking, and involve a number of risks and uncertainties that could cause actual results to differ materially. Please note that these forward-looking statements reflect our opinions only as of the date of this call, and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Please refer to our SEC filings, specifically our Form 10-K, as well as our financial results press release for a more detailed description of the risk factors that may affect our results. These documents are available at our website, spscommerce.com, and at the SEC's website, sec.gov. In addition, we are providing a historical data sheet for easy reference on the investor relations section of our website, spscommerce.com. During our call today, we will discuss adjusted EBITDA financial measures and non-GAAP income per share. In our press release and our filings with the SEC, each of which is posted on our website, you will find additional disclosures regarding these non-GAAP financial measures, including reconciliations of these measures with comparable GAAP measures. And with that, I will turn the call over to Chad.

Thanks, Armina, and good afternoon, everyone. Thank you for joining us today. We delivered a strong third quarter. Revenue grew 21% to $163.7 million. Recurring revenue also grew 21%. It's been a year since I joined SPS Commerce. I've now come to fully appreciate the power of SPS's go-to-market strategy, network effect, and unique ability to improve collaboration and data accuracy to optimize supply chain operations. As the retail industry continues to increase in complexity, naturally, SPS's role in automating trading partner relationships continues to evolve. We are in the process of evaluating the expanded opportunity ahead of us, and we look forward to sharing our updated view of our addressable markets. The acquisitions we have completed in the past year exemplify SPS's growing TAM and our commitment to delivering a comprehensive suite of solutions to help retailers and suppliers improve collaboration. Last month marked the one-year anniversary of closing the TIE Kinetics acquisitions. We are pleased with our progress of the post-merger integration and remain enthusiastic about the long-term potential. As a reminder, we acquired Tide Kinetics to add e-invoicing capability to our product portfolio, establish a go-to-market beachhead in Europe for a fulfillment product, and strengthen our position in the U.S. market by adding the U.S. portion of the Tide Kinetics business to our U.S. operations. e-invoicing capability is a frequent requirement for customers implementing fulfillment outside of the U.S. in countries where there is an e-invoicing mandate. With this capability integrated into our fulfillment product, we can now address the needs of these customers. We appreciate the differences between North America and European retail markets, but with access to the experience and knowledge of the Thai Kinetics team, we are optimistic about the success and long-term potential of our opportunity in Europe. This year we continued to be acquisitive, and in Q3 we acquired Supply Pike and expanded our portfolio with automated invoice deduction management and prevention. We're excited to welcome our new employees and customers to SPS Commerce. Much like the acquisition of Traverse Systems in May this year, we strive to offer our customers and the broader market the resources needed to reduce supply chain missteps and strengthen suppliers' relationships with retailers. We are pleased to see our customers benefiting from these offerings. For example, GNC is the world's largest global specialty health, wellness, and performance retailer and one of SPS's longtime customers. They've worked with Traverse Systems over the years and leveraged the platform to gain complete visibility into every part of the purchase order lifecycle. They were able to isolate the root causes of problematic shipments and worked with vendors to raise the advanced shipping notice compliance rate from 76% to 92%. This resulted in better visibility into inbound shipments, allowing GNC to improve time to value of its inventory. Bissell, a leading manufacturer of home cleaning solutions, was challenged with significant invoice deductions in their order fulfillment process because the recovery process was too cumbersome and time consuming. Using Supply Pike's automated invoice deduction management and prevention solution, To consolidate data from retailer portals into a single user-friendly platform gave Bissell the visibility they needed to save millions in disputed deductions across multiple retailers. Having access to data on one platform also helped Bissell gain actionable insights into deduction trends across retailers, identify areas for improvement, and optimize deduction recovery strategies. Automation and optimization remains a priority across retail and distribution businesses. For example, Bunzel Retail Services offers a complete line of retail products and supplies for more than 83,000 SKUs and operates seven distribution centers across U.S. and Canada and six more internationally. Bunzel recognized that in order to run the business more efficiently to support their growth, they had to optimize data by minimizing manual intervention and improve order visibility. To support their goal to digitize their supply chain, they recently partnered with SPS Commerce to automate ordering, receiving, and invoicing processes with over 1,000 vendors. The evolving dynamics of the retail industry continue to drive digital transformation. SPS has been a trusted partner to thousands of retailers, suppliers, logistics providers, and distributors over the years, and we remain committed to our vision to be the world's retail network. Our customers continue to prioritize supply chain resilience and recognize the value we bring to the table as they strive for efficient collaboration with their trading partners. With that, I'll turn it over to Kim to discuss our financial results.