SPS Commerce, Inc. (NASDAQ:SPSC) Q1 2020 Earnings Conference Call - Final Transcript

Ladies and gentlemen, thank you for standing by and welcome to the SPS Commerce Q1 2020 Earnings Call.

[Operator Instructions]

I would now like to hand the conference over to your speaker today, Irmina Blaszczyk. You may begin.

Thank you, Blue. Good afternoon, everyone. And thank you for joining us on SPS Commerce first quarter 2020 conference call.

We will make certain statements and projections 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 and projections are forward looking and involve a number of risks and uncertainties that could cause actual results to differ materially. We note in particular that uncertainty regarding the impact of COVID-19 pandemic on our performance could cause actual results to differ materially from our projections.

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 we furnished via Form 8-K to the SEC earlier today 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 our Investor Relations section of our website, spscommerce.com.

During our call today, we will discuss adjusted EBITDA, financial measures and non-GAAP earnings per share. In our press release and our filings with the SEC, each of which is posted on our website, we will find additional disclosures regarding these non-GAAP and adjusted EBITDA measures, including reconciliations of these measures with comparable GAAP measures.

And with that, I will turn the call over to Archie.

Thanks, Irmina, and welcome, everyone. First and foremost, we hope you're all staying safe and well, and our thoughts are with everyone affected by the coronavirus pandemic. The health and safety of our employees, customers and partners is a top priority, and we remain fully committed to support the suppliers and retailers that serve our communities in these challenging times.

SPS Commerce services are absolutely critical to our customers to ensure they are able to deliver the day-to-day essentials we all need. We are a cloud-native company and the investments we have made over the years in our tools, systems and processes enable us to deliver uninterrupted and secure service anywhere in the world, often with nothing more than a web browser. Due to the nature of the SaaS business model, we are able to operate remotely, providing a full-service experience to existing customers and promptly onboarding new suppliers as needed.

For the first quarter, revenue grew 11% to $74.2 million. Recurring revenue grew 12% and adjusted EBITDA grew 24% to $20.4 million. SPS Commerce provides a mission-critical service