Shares of SPS Commerce (SPSC) plunged 32.13% in Friday's pre-market trading following the company's disappointing third-quarter earnings report and reduced full-year guidance. The cloud-based supply chain management solutions provider fell short on revenue expectations and provided a cautious outlook, spooking investors.

For the third quarter, SPS Commerce reported revenue of $189.904 million, missing the analyst consensus estimate of $191.797 million. Despite beating earnings expectations with adjusted earnings per share of $1.13 compared to the expected $1.00, the revenue miss overshadowed the positive earnings result. The company's CEO, Chad Collins, acknowledged the impact of "ongoing global trade and economic uncertainty" on the company's performance, noting increased scrutiny in spending among some customer groups.

Adding to investor concerns, SPS Commerce lowered its full-year 2025 revenue guidance to a range of $751.6 million to $753.6 million, down from its previous forecast of $759 million to $763 million. The company also provided a cautious fourth-quarter revenue outlook of $192.7 million to $194.7 million, which appears to be lower than analyst expectations. This conservative outlook, reflecting concerns about the current economic environment, likely contributed to the sharp sell-off. Despite announcing a new $100 million share repurchase program in an attempt to bolster investor confidence, the negative sentiment surrounding the revenue miss and reduced guidance prevailed, resulting in the significant stock price drop.