CMRC Q2 Earnings Call Flags Softer B2C Demand, Outlook Cut

CMRC Cuts Outlook on Deliberate Trade-Offs

CFO & COO Daniel Lentz put third-quarter revenues at $82.5 million to $85.5 million, with non-GAAP operating income of $3.3 million to $5.3 million.

Lentz set 2026 revenue guidance at $336.5 million to $344.5 million and non-GAAP operating income at $28 million to $34 million.

He said the revenue midpoint is $18 million below the prior outlook, split roughly evenly between a smaller partner ecosystem and cautious bookings assumptions. The operating-income midpoint fell $12.5 million, also reflecting R&D and AI infrastructure spending.

Commerce.com Sees B2C Replatforming Stay Soft

A Needham analyst pressed CEO Travis Hess on replatforming. Hess said deals are taking longer rather than disappearing as merchants reassess technology priorities around AI-driven discovery.

Hess said B2C replatforming remains the main area of softness, while win and close rates have not changed materially. He also cited second-half holiday timing as another reason for prudence.

An Oppenheimer analyst asked whether June pricing changes were affecting demand. Lentz said the changes touched only a small portion of ARR and had not affected pipeline or conversion.

CMRC Leans Into Product Intelligence and AI

CEO Travis Hess said Commerce is concentrating resources on product intelligence, AI, payments and B2B rather than every near-term revenue opportunity. Feedonomics is central as discovery spreads across AI assistants, marketplaces and other channels.

In response to a Canaccord analyst, Hess emphasized Feedonomics’ platform-agnostic positioning among large merchants. Lentz said Feedonomics represents roughly 20% of ARR, perhaps slightly less, and is growing faster than the overall business.

Lentz said non-GAAP gross margin fell to 75.7% from 77.4% in the first quarter as AI crawlers and agents drove higher hosting costs. Lentz said Commerce is keeping storefronts broadly accessible despite the expense.

Commerce Payments Runs Ahead of Internal Plans

Hess described BigCommerce Payments adoption as ahead of expectations after its U.S. launch. Lentz said GMV on the branded solution is running more than 30% above internal targets.

Lentz said new and existing merchants are adopting the product, including some larger customers despite its initial small-business and mid-market focus.

Lentz said Commerce remains on track for a U.K. launch later this year and framed payments as a tool for bringing revenue growth closer to underlying GMV growth.

CMRC Sees B2B Strength but a Monetization Gap

B2B GMV increased 17% year over year, faster than the platform’s 14% growth. Lentz said B2B pipeline growth, win rates and gross retention are stronger than in the broader business.

He also said B2B customers use fewer credit-card transactions, limiting partner and services revenues and requiring Commerce to find additional ways to participate in B2B payment flows.

Hess said manufacturers and distributors fit the platform’s strengths in complex catalogs, permissions and workflows. He added that the dedicated B2B go-to-market organization has helped support momentum.

Commerce Keeps Focus on Durable Economics

Hess closed by emphasizing a more durable business model rather than maximizing near-term revenues. Hess said priorities remain product intelligence, agentic commerce, payments, B2B, Makeswift and Feedonomics Surface.

Commerce ended the quarter with ARR of $360.5 million and NRR of 95.8%, the third consecutive sequential improvement. Lentz said the company remains on track for full-year GAAP profitability.

CMRC’s Zacks Rank and Style Scores

CMRC carries a Zacks Rank #3 (Hold), with a Value Score of A, Growth Score of A, Momentum Score of A and a VGM Score of A. Under the Zacks framework, A and B Style Scores are more favorable than lower grades, while VGM combines value, growth and momentum characteristics.

The Zacks Rank and Style Scores work together, with the strongest historical combinations centered on Zacks Rank #1 (Strong Buy) and #2 (Buy) stocks paired with A or B scores. CMRC’s rank is less favorable than the top ranks, and the Zacks Rank can change as estimates are revised after the results. You can see the complete list of today’s Zacks #1 Rank stocks here.

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