SPS Commerce (NASDAQ: SPSC) to Acquire Carbon6 Technologies for $210 Million, Expands Revenue Recovery Capabilities

2 min read | January 03, 2025 04:01 PM AEDT | By Team Kalkine Media

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SPS Commerce (NASDAQ: SPSC) to Acquire Carbon6 Technologies for $210 Million, Expands Revenue Recovery Capabilities — Image source: Shutterstock

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Highlights

SPS Commerce acquires Carbon6 for $210 million, strengthening revenue recovery tools.

Acquisition expected to generate $40.0 million in revenue for SPS in fiscal 2025.

Carbon6 acquisition enhances SPS’s market position in invoice deduction management.

SPS Commerce (NASDAQ:SPSC) has announced a strategic acquisition of Carbon6 Technologies for approximately $210 million, with 40% of the payment to be made in SPSC stock. This move is set to expand SPS Commerce’s capabilities in revenue recovery and invoice deduction management, with Carbon6’s software tools aimed at supporting Amazon sellers. Carbon6 offers ChargeGuard for first-party sellers and Seller Investigators for third-party sellers, helping them manage invoice deductions and recover lost revenue from major e-commerce transactions.

The acquisition is expected to contribute approximately $7.0 million in revenue in Q1 2025 and a total of $40.0 million in revenue for fiscal year 2025. Additionally, the deal is anticipated to increase SPS Commerce’s Adjusted EBITDA by $5.5 million in 2025, highlighting the potential for enhanced financial performance as the integration of Carbon6’s offerings unfolds. The acquisition is part of SPS Commerce's broader strategy to strengthen its position in the market for invoice deduction management, especially within the e-commerce sector, where sellers often face complex billing and payment challenges from large retailers like Amazon and Walmart.

SPS Commerce’s acquisition of Carbon6 follows its earlier purchase of SupplyPike, another company focused on improving invoice deduction processes. With both acquisitions, SPS is positioning itself as a leading provider of revenue recovery solutions, particularly for suppliers and sellers working with major online retailers. The company’s growing suite of tools is expected to offer businesses more robust solutions for managing their revenue, reducing invoice disputes, and improving overall financial efficiency.

While the acquisition offers clear growth potential, it does come with a few considerations. The 40% payment in SPS Commerce stock may lead to some dilution for existing shareholders. However, the company believes the long-term strategic benefits of expanding its revenue recovery capabilities outweigh the short-term impact. Additionally, while Carbon6’s contribution to Q1 2025 revenue is expected to be breakeven in terms of Adjusted EBITDA, SPS Commerce expects significant financial benefits as the integration progresses and the tools begin to reach a larger customer base.

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