The new chief executive at Minneapolis-based SPS Commerce signaled the possibility of more international expansion in the company's strategy to continue its steady growth.
New SPS Commerce CEO aims for more geographic expansion beyond Minneapolis
Chad Collins succeeded Archie Black as CEO on Oct. 2, and in his first earnings call, he pointed to the potential for an international presence.
October 27, 2023 at 6:47PM
"One of the growth vectors that we will be looking at is geographic expansion," Chad Collins told analysts on his first earnings call as CEO.
SPS has largely operated in the United States, but it has been making inroads internationally. During the third quarter it completed one of its bigger deals, acquiring TIE Kinetix, a Netherlands-based provider of supply-chain digitalization including EDI (electronic data interchange) and e-invoicing in Europe, for approximately $72 million.
"We expect Collins to continue to execute the same game plan that has served SPS Commerce so well for many years," wrote Matthew Pfau, an analyst who covers SPS for William Blair & Co. "However, we could see him making some tweaks to the growth levers, including international and product expansion."
The Minneapolis-based provider of cloud-based supply-chain management software reported third-quarter results after the market closed Thursday. It earned $16.8 million, or 45 cents a share, compared with $15.9 million, or 43 cents a share, in the third quarter of 2023.
SPS' adjusted earnings per share for the quarter was 75 cents a share, a 19% increase over the third quarter of 2022. Earnings exceeded the consensus analyst expectation of 67 cents.
Revenue grew 18% to $135.7 million extending its streak of consecutive quarters of revenue growth for the company to 91.
SPS helps retailers electronically manage invoices with suppliers and process orders in omnichannel environments.
Collins succeeded Archie Black on Oct. 2. Black has moved to an executive chairman role after leadings SPS for 22 years.
A Minneapolis native, Collins has spent 25 years in the supply-chain software industry, most recently as global CEO of Körber Supply Chain Software. Prior to that he was CEO of Minneapolis-based HighJump Software before it was acquired by Körber in 2017.
A key influence will be whether Minnesotans like paid family medical leave when it starts in 2026.
