CMRC Q4 Deep Dive: B2B Momentum and Payments Rollout Fail to Offset Soft Guidance

E-commerce software company Commerce (NASDAQ:CMRC) missed Wall Street’s revenue expectations in Q4 CY2025 as sales rose 2.9% year on year to $89.52 million. Next quarter’s revenue guidance of $83 million underwhelmed, coming in 3.5% below analysts’ estimates. Its non-GAAP profit of $0.07 per share was in line with analysts’ consensus estimates.

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StockStory’s Take

Commerce’s fourth quarter results were met with a negative market reaction, as the company missed Wall Street’s revenue expectations and delivered only modest year-on-year growth. Management pointed to strong adoption of its B2B ecommerce solutions and early traction from new product launches as positive factors, but also cited weaker-than-anticipated performance in the business-to-consumer (B2C) segment, particularly in the latter part of the year. CEO Travis Hess acknowledged that agentic commerce trends—where buyers increasingly use AI-driven interfaces—are reshaping customer journeys and may have impacted replatforming activity among larger retailers, noting, “We were disappointed in what we delivered in the back half of the year.”

Looking forward, Commerce’s revenue guidance for the next quarter and full year reflects both optimism around new product initiatives and caution regarding macroeconomic uncertainty. Management plans to accelerate investment in research and development by nearly 30%, with a focus on monetizing its existing customer base through product cross-sell, payments integration, and expanding AI-powered solutions. CFO Daniel Lentz emphasized a disciplined approach to spending, stating that higher-than-expected revenue would be reinvested in growth, but also acknowledged that some guidance conservatism reflects “a little bit of conservatism in Q1 and carrying that forward in case we start to see just some sort of macro issues.”

Key Insights from Management’s Remarks

Management attributed the quarter’s performance to B2B segment strength, new product launches, and a shift toward unified platform metrics, while also highlighting challenges in B2C and customer expansion.

• B2B segment growth: The company reported that B2B customers were the main contributors to new annual recurring revenue (ARR), with BigCommerce B2B Edition achieving nearly 20% growth and the highest retention across the product portfolio.
• Early success of Feedonomics Surface: The self-service Feedonomics Surface tool, launched in late Q3, drove a 24-point increase in gross merchandise volume (GMV) growth for users compared to non-users, demonstrating value in product data enrichment and multi-channel syndication.
• Unified product and brand strategy: Commerce completed the integration of its products under a single platform and brand, aiming to streamline operations and enhance cross-product adoption. This restructuring also led to efficiency gains and increased profitability.
• Metric disclosure changes: Management shifted away from enterprise-specific metrics to report broader measures like total GMV and company-wide net revenue retention (NRR), arguing these better reflect the business’s health and expansion opportunities. NRR was 95.2%, below best-in-class levels, and identified as a key area for improvement.
• Operational focus on monetization: Despite double-digit GMV growth, ARR growth lagged due to lower payment monetization in B2B and a need for improved cross-selling. Management highlighted efforts to close this gap through payments integration, product bundling, and AI-driven solutions.

Drivers of Future Performance

Commerce’s outlook is shaped by its push for product-led monetization, payments integration, and cautious spending amid macroeconomic headwinds.

• Payments platform rollout: The launch of BigCommerce Payments, in partnership with PayPal, is expected to drive margin improvement and greater monetization of GMV. Initial efforts will target small and midsized merchants, with broader rollout to enterprise customers planned for later in the year. Management described this as a significant pivot toward a more focused payments strategy.
• AI and cross-product integration: Increased R&D investment will prioritize embedding AI capabilities into the core platform and expanding Feedonomics Surface and MakeSwift. Management expects these initiatives to enhance customer retention, increase average revenue per account, and create new monetization paths via data services and bundled offerings.
• Retention and expansion focus: Improving company-wide net revenue retention is a central priority. Management pointed to incremental NRR improvement embedded in guidance, driven by product enhancements, deeper customer engagement, and a shift from plan-based to usage- and value-based expansion. However, leadership acknowledged that achieving best-in-class NRR will require ongoing execution and operational discipline.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will be watching (1) the adoption rate and margin impact of BigCommerce Payments as it rolls out, (2) the pace and breadth of customer uptake for AI-powered products like Feedonomics Surface and MakeSwift, and (3) incremental improvements in net revenue retention as new monetization strategies take hold. We will also track how effectively the company links ARR growth to its expanding GMV base.

Commerce currently trades at $2.46, down from $2.75 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).

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