Commerce.com, Inc. Q2 FY2025 earnings call

• Q2 represented solid progress with non-GAAP operating income, ARR, revenue, and operating cash flow all showing improvements. - The company rebranded to Commerce to reflect the shift to AI-driven commerce, aiming to shape the future of commerce. - Key partnerships include with Perplexity, Google Cloud, PROS, and Accenture, which enhance capabilities in AI-driven commerce. - Product developments such as the upcoming release of Feedonomics within the BigCommerce control panel, Makeswift, and branded payments are in the works. - Pipeline conversion rates are improving as sales teams align with specific use cases and verticals. - The company was awarded 24 out of 24 medals in the 2025 Paradigm B2B Combine for the third year, and welcomed top B2B and B2C brands.

In Q2 2025, Commerce achieved several key financial metrics. Revenue reached $84.4 million, growing 3% year-over-year. Non-GAAP operating income was nearly $4.8 million, a 335 basis point margin improvement year-over-year. Annual revenue run-rate (ARR) was nearly $355 million, a 3% year-over-year increase. Operating cash flow was approximately $13.6 million, an improvement of nearly $2 million year-over-year. Non-GAAP gross margin strengthened to 80%, up 280 basis points year-over-year. Average revenue per enterprise account rose to $46,403, a 9% increase year-over-year.

• For Q3 2025, revenue is expected to be between $85 million and $87 million, and non-GAAP operating income between $2.3 million and $3.3 million. - For full-year 2025, revenue is expected to be between $339.6 million and $346.6 million, and non-GAAP operating income between $19 million and $25 million. - Prioritizing growth acceleration while investing in core products and AI advancements, with a focus on margin expansion in the low to mid-single digits.

• Risks associated with forward-looking statements, including uncertainties in AI adoption rates, market competition, and the execution of growth strategies. - Uncertainties in the commercialization of agentic commerce features and the pace at which answer engines will integrate and value Commerce's product data.

Q: Raimo Lenschow asks about seeing in the field and the impact of rebranding.

A: Travis Hess notes continued success, especially in B2B, and Daniel Lentz explains the rebrand is a corporate parent brand change not affecting individual product branding but providing a more cohesive message.

Q: Ken Wong asks about measuring the product portfolio success.

A: Travis Hess states leading indicators like pipeline build and client efficacy will show progress, with material signs of growth likely in early 2026.

Q: Natalie Howe asks about B2B adoption and payment solution.

A: Travis Hess discusses B2B momentum due to platform capabilities and partnership with PROS for CPQ, while Daniel Lentz explains the payment solution is for small and mid-market customers, offering an optional, integrated solution.

Q: David E. Hynes asks about BigCommerce's opportunity as platform vs data orchestration layer.

A: Travis Hess says both are important, with an open composable approach, and Daniel Lentz notes AI trends benefit all revenue streams, with Feedonomics likely growing disproportionately.

Q: Jeffrey Parker Lane asks about pipeline conversion and margin expansion.

A: Daniel Lentz says pipeline build is healthy with improving win rates, and margin expansion is possible while prioritizing growth acceleration and investing in core products.