Commerce Announces Strategic Operating Plan to Accelerate Profitability and Free Cash Flow Generation

Commerce launches a multi-year cost and capital-return plan that lifts 2026 profit guidance and targets 20%+ non-GAAP margins from 2027.

Rhea-AI Summary

Commerce (CMRC) announced a strategic operating plan targeting at least 20% full-year non-GAAP operating margins beginning in 2027, plus a new $50 million share repurchase authorization effective through September 10, 2028.

The plan is expected to reduce the annualized non-GAAP operating cost base by approximately $60 million to $80 million, equal to $0.73 to $0.97 per diluted share based on the June 30, 2026 share count. About $3 million, or 4%, of these savings are expected in 2026, with the full annualized benefit in 2027. Commerce cites approximately $353 million of net operating loss carryforwards and other tax attributes as of June 30, 2026 to help limit cash taxes on incremental earnings.

For 2026, total revenue guidance is reaffirmed at $336.5 million to $344.5 million, while non-GAAP operating income guidance is raised by $3 million to $31.0 million to $37.0 million. Third-quarter 2026 guidance is unchanged, with revenue of $82.5 million to $85.5 million and non-GAAP operating income of $3.3 million to $5.3 million. Commerce expects to incur $4.2 million to $8.8 million of restructuring and other one-time expenses in the third quarter of 2026 and $4.3 million to $17.5 million in the fourth quarter, mainly related to reductions in staffing and other operating costs, and aims to substantially complete the plan by the second quarter of fiscal 2027.

Positive

• Annualized cost savings of approximately $60 million to $80 million targeted from the strategic operating plan
• Per-share benefit of approximately $0.73 to $0.97 in annualized cost savings based on the June 30, 2026 diluted share count
• Non-GAAP operating margin targeted at a minimum of 20% starting in 2027 on an ongoing basis
• 2026 non-GAAP operating income guidance raised by $3 million to a range of $31.0 million to $37.0 million
• Share repurchase authorization of up to $50 million over two years from September 10, 2026 to September 10, 2028
• Tax attributes of approximately $353 million in net operating loss carryforwards and other items as of June 30, 2026 expected to reduce cash taxes on incremental earnings

Negative

• Restructuring and one-time expenses expected at $4.2 million to $8.8 million in Q3 2026 and $4.3 million to $17.5 million in Q4 2026
• Limited near-term savings with only about $3 million (4% of targeted annualized savings) expected to be realized in 2026
• Cost reductions include staffing, professional services, facilities, software and infrastructure, which may affect operations and workforce

News Explained

The $50 million buyback is a discretionary ceiling, not a committed use of Commerce’s cash.

Commerce has authorized repurchases of up to $50 million through September 10, 2028, but the authorization does not commit the company to buy any shares and can be suspended or discontinued.

On the June 30, 2026 balance-sheet record, that maximum is below the $156,324,000 held in cash and short-term investments, although the release says repurchases would be funded from generated cash flow. Actual holder ownership changes therefore depend on repurchases that are later disclosed.

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Details

Market reaction after 2026 guidance update: CMRC +19.95%

$2.64 $3.12 Day Range

$258.41M Market Cap

Following this news, CMRC has gained 19.95%, reflecting a significant positive market reaction. Our momentum scanner has triggered 36 alerts so far, indicating elevated trading interest and price volatility. The stock is currently trading at $3.12. Trading volume is exceptionally heavy at 49.5x the average, suggesting very strong buying interest.

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Market Context

-31.96% followed Commerce’s Aug 06 Q2 earnings report, a relevant prior operating update; the curren...

Analysis

-31.96% followed Commerce’s Aug 06 Q2 earnings report, a relevant prior operating update; the current announcement changed the profitability and cash-generation framework while raising operating-income guidance.

Key Figures

Non-GAAP operating margin target: At least 20% Annualized cost savings: $60 million to $80 million Per diluted share savings: $0.73 to $0.97 +5 more

Non-GAAP operating margin target

At least 20%

Beginning in 2027 and ongoing thereafter

Annualized cost savings

$60 million to $80 million

Operating plan

Per diluted share savings

$0.73 to $0.97

Annualized cost savings

Tax attributes

$353 million

Net operating loss carryforwards and other tax attributes as of June 30, 2026

Q3 restructuring expenses

$4.2 million to $8.8 million

Third quarter ended September 30, 2026

Q4 restructuring expenses

$4.3 million to $17.5 million

Fourth quarter of fiscal 2026

Share repurchase authorization

Up to $50 million

Repurchases authorized from September 10, 2026 through September 10, 2028

2026 non-GAAP operating income guidance

$31.0 million to $37.0 million

Raised by $3 million from prior guidance of $28.0 million to $34.0 million

Historical Context

1 past event · Latest: Aug 06

1 event

1. Aug 06

   Q2 earnings report

   24h Move

   -32.0%

   Reported Q2 profitability and reaffirmed 2026 guidance before the current plan raised operating-income guidance.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

non-gaap operating margins, free cash flow, net operating loss carryforwards, fully diluted shares

4 terms

non-gaap operating margins financial

"Commerce is targeting full-year non-GAAP operating margins of at least 20%"

Non-GAAP operating margin is a company's operating profit as a percentage of sales after excluding one-time or unusual costs and accounting items that management believes obscure ongoing performance. Think of it like measuring a car’s typical fuel efficiency but ignoring a few rare long trips—investors use it to see the company’s core profitability and trend performance, but it matters to compare consistently since exclusions can vary between firms.

free cash flow financial

"materially increase profitability and free cash flow"

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

View in glossary

net operating loss carryforwards financial

"approximately $353 million of total net operating loss carryforwards"

Net operating loss carryforwards are tax rules that let a company apply past operating losses against future taxable profits, reducing the amount of tax it must pay when it returns to profitability. Think of it like a negative balance in a tax ledger that can be used to lower future tax bills, improving after-tax cash flow and earnings; investors track the size, expiration rules and any limits because they affect valuation and future cash available to the business.

fully diluted shares financial

"approximately 82.6 million fully diluted shares outstanding"

Fully diluted shares are the total number of company shares that would exist if every claim that can be turned into common stock—such as employee stock options, warrants, and convertible debt or preferred shares—were exercised or converted. Investors use this number to see the biggest possible share count when calculating ownership percentages, earnings per share and dilution risk; think of it as counting all possible slices of a pie if every coupon could be redeemed.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Company targets full-year non-GAAP operating margins of at least 20% beginning in 2027 and materially higher free cash flow

Plan expected to generate approximately $60 million to $80 million of annualized cost savings, or $0.73 to $0.97 on a per diluted share basis

Board authorizes up to $50 million of share repurchases over the next two years

AUSTIN, Texas, Sept. 10, 2026 (GLOBE NEWSWIRE) -- Commerce.com, Inc. (Nasdaq: CMRC) ("Commerce,” “We” or the "Company"), a data-centric provider of an open, AI-driven commerce ecosystem that enables businesses to unlock data, power intelligent discovery and deliver personalized experiences at scale, today announced a strategic operating plan designed to reduce costs and materially increase profitability and free cash flow.

The plan is expected to generate approximately $60 million to $80 million of annualized cost savings, or $0.73 to $0.97 on a per diluted share basis (based on diluted share count as of June 30th, 2026). Commerce expects to realize approximately $3 million, or 4%, of the anticipated savings during 2026, with the full annualized benefit reflected in 2027.

The plan increases efficiency while protecting investments in the products and capabilities that will drive future growth. Investment will stay focused on complex commerce needs across B2B and B2C, especially the Company's differentiated B2B position, along with continued investment in payments, Feedonomics, product intelligence, and agentic commerce. Spending will be reduced in areas that are less central to the Company’s strategy or where expected returns are lower.

“Over the past several quarters, we have focused Commerce on the parts of the business where we see the strongest opportunities to grow,” said Travis Hess, Chief Executive Officer of Commerce. “We also need to be more disciplined about what we spend and the returns we generate from those investments. This plan reduces costs while protecting our key growth investments, and we expect it to meaningfully increase profitability and free cash flow.”  

Financial Impact and Objectives

As part of the plan, Commerce is targeting full-year non-GAAP operating margins of at least 20% beginning in 2027 and on an ongoing basis thereafter.

The plan is expected to:

• Reduce the Company's annualized non-GAAP operating cost base by approximately $60 million to $80 million, with the majority of these savings expected to translate into additional free cash flow.
• Deliver approximately $0.73 to $0.97 on a per diluted share basis (based on diluted share count as of June 30, 2026) of annualized cost savings.
• Benefit from approximately $353 million of total net operating loss carryforwards and other tax attributes as of June 30, 2026, which are expected to reduce cash taxes on incremental earnings and support strong conversion to free cash flow.
  
  

The plan primarily includes reductions in operating costs, such as staffing, professional services, facilities, software, and infrastructure. Commerce also expects to realize continued efficiency improvements through the expanded use of AI across its internal operations. Commerce expects the majority of the actions and expenses related to the Plan to be implemented and recorded by the end of our fiscal fourth quarter 2026 and the plan to be substantially complete by our second quarter in fiscal 2027.

The Company currently expects to incur approximately $4.2 million to $8.8 million of restructuring and other one-time expenses in the Company’s third quarter ended September 30, 2026 and $4.3 million to $17.5 million of restructuring expenses in the Company’s fourth quarter of fiscal 2026.

“This plan materially increases the profitability and free cash flow we believe Commerce can generate without changing our growth strategy,” said Daniel Lentz, Chief Financial Officer and Chief Operating Officer of Commerce. “At our current revenue base, we believe the business can generate meaningfully more cash. Our existing tax attributes should also help limit cash taxes and support strong free cash flow conversion. As free cash flow increases, we expect to have greater flexibility to return capital to shareholders while maintaining a strong balance sheet and continuing to invest in the business.”

Share Repurchase Authorization

The Company’s Board of Directors has authorized the repurchase of up to $50 million of Commerce common stock over the next two years beginning on September 10, 2026 through September 10, 2028. The repurchase is expected to be funded from cash flow generated by the Company's disciplined approach to capital allocation and operating performance.

Any repurchases of shares may be made from time to time at the Company’s discretion. The timing, amount and method of any repurchases will depend on market conditions, the Company’s financial position, other uses of capital and other relevant factors. The authorization does not require Commerce to repurchase any specific amount of stock and may be modified, suspended or discontinued at any time.

2026 Financial Outlook

As a result of the plan, Commerce is updating its full-year 2026 guidance. The Company is reaffirming its full-year revenue guidance and raising its full-year non-GAAP operating income guidance by $3 million to reflect savings expected to be realized in 2026. The Company currently expects:

• Total revenue between $336.5 million and $344.5 million.
• Non-GAAP operating income between $31.0 million and $37.0 million.

The Company is also reaffirming its third quarter 2026 guidance of total revenue between $82.5 million and $85.5 million and non-GAAP operating income between $3.3 million and $5.3 million, unchanged from the guidance provided on August 6, 2026.

Prior full-year 2026 guidance was for total revenue of $336.5 million to $344.5 million and non-GAAP operating income of $28.0 million to $34.0 million. The Company currently has approximately 82.6 million fully diluted shares outstanding for the six months ended June 30, 2026.

The updated outlook incorporates approximately $3 million of savings expected to be realized during the remainder of 2026 (as reflected in our updated non-GAAP operating income outlook above). The strategic operating plan is not expected, by itself, to have a material impact on the Company's 2026 revenue outlook.

About Commerce

Commerce (Nasdaq: CMRC) empowers businesses to innovate, grow, and thrive by providing an open, AI-driven commerce ecosystem. As the parent company of BigCommerce, Feedonomics, and Makeswift, Commerce connects the tools and systems that power growth, enabling businesses to unlock the full potential of their data, deliver seamless and personalized experiences across every channel, and adapt swiftly to an ever-changing market. Trusted by leading businesses like Coldwater Creek, Cole Haan, Dell, King Arthur Baking Co., Mizuno, Pacsun, Perry Ellis, Skechers, SportsShoes and Uplift Desk, Commerce delivers the storefront control, optimized data, and AI-ready tools businesses need to grow, serve diverse buyers, and operate with confidence in an increasingly intelligent, multi-surface world. For more information, visit www.commerce.com or follow us on X and LinkedIn.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of applicable federal securities laws. These statements include, among other things, statements regarding the scope, timing and implementation of the Company's strategic operating plan; expected cost savings, charges and cash expenditures; anticipated effects on revenue, operating income, margins, earnings per share and free cash flow; the Company's financial objectives and guidance; preservation of strategic investments; future growth opportunities; and the expected use of net operating loss carryforwards.

Forward-looking statements are based on management's current expectations and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially. These risks include the Company's ability to implement the plan within the anticipated timeframe, the possibility that expected savings may not be fully realized, potential disruption to the Company's operations, customers or employees, and the other risks described in the Company's filings with the Securities and Exchange Commission, including under the caption "Risk Factors." Forward-looking statements speak only as of the date they are made, and Commerce assumes no obligation to update them except as required by law.

Use of Non-GAAP Financial Measures

This press release includes certain financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"), including non-GAAP operating income and free cash flow. These measures are supplemental to, and should not be considered in isolation or as substitutes for, comparable GAAP measures.

Commerce defines non-GAAP operating income as GAAP income or loss from operations excluding stock-based compensation expense and related payroll taxes, amortization of intangible assets, acquisition-related costs and restructuring charges. The most directly comparable GAAP measure is income or loss from operations.

Commerce defines free cash flow as net cash provided by operating activities less capital expenditures. The most directly comparable GAAP measure is net cash provided by operating activities.

The Company does not provide guidance for GAAP income or loss from operations or cash flows from operating activities. A reconciliation of forward-looking non-GAAP operating income and free cash flow to the most directly comparable GAAP measures is not available without unreasonable effort because reliable estimates for certain reconciling items are unavailable. These items may vary significantly between periods and could materially affect future financial results.

BigCommerce®, the Commerce logo, and other brands are the trademarks or registered trademarks of Commerce.com Pty. Ltd. Third-party trademarks and service marks are the property of their respective owner.

Media Relations Contact

Brad Hem
PR@commerce.com

Investor Relations Contact

Tyler Duncan
InvestorRelations@commerce.com

FAQ

What are the main components of Commerce's strategic operating plan?

The plan focuses on reducing non-GAAP operating costs by approximately $60 million to $80 million on an annualized basis. Cost actions primarily target staffing, professional services, facilities, software and infrastructure, along with efficiency gains from expanded use of AI across internal operations. Commerce states that spending will be reduced in areas less central to its strategy or with lower expected returns, while preserving investment in B2B and B2C complex commerce, payments, Feedonomics, product intelligence and agentic commerce.

When will Commerce implement and complete the cost-reduction plan?

Commerce expects that the majority of the actions and related expenses will be implemented and recorded by the end of its fiscal fourth quarter 2026. The plan is expected to be substantially complete by the second quarter of fiscal 2027, with the full annualized cost savings reflected in 2027.

How is Commerce's 2026 financial outlook changing as a result of the plan?

For full-year 2026, Commerce is reaffirming total revenue guidance of $336.5 million to $344.5 million. It is raising its full-year non-GAAP operating income guidance by $3 million, to a range of $31.0 million to $37.0 million, incorporating approximately $3 million of cost savings expected in 2026. The plan is not expected, by itself, to have a material impact on the 2026 revenue outlook.

What guidance has Commerce provided for the third quarter of 2026?

For the third quarter of 2026, Commerce is reaffirming its prior guidance of total revenue between $82.5 million and $85.5 million and non-GAAP operating income between $3.3 million and $5.3 million. This guidance is unchanged from what was provided on August 6, 2026.

How will the $50 million share repurchase authorization work?

The Board has authorized the repurchase of up to $50 million of Commerce common stock from September 10, 2026 through September 10, 2028. Repurchases may be made from time to time at the company’s discretion and are expected to be funded from cash flow generated by its capital allocation approach and operating performance. The timing, amount and method of any repurchases will depend on market conditions, the company’s financial position, other uses of capital and other factors, and the authorization can be modified, suspended or discontinued at any time without requiring a specific amount of stock to be repurchased.

How many fully diluted shares does Commerce currently have outstanding?

Commerce reports that it currently has approximately 82.6 million fully diluted shares outstanding for the six months ended June 30, 2026. This share count underlies the calculation of the $0.73 to $0.97 per diluted share of expected annualized cost savings.