- Shopify (TSX:SHOP) reported Q2 revenue of US$3.58 billion and adjusted earnings of $0.42 per share, beating analyst expectations while delivering 34 per cent revenue growth
- The company forecast low-30 per cent revenue growth for Q3, above Wall Street estimates, driven in part by strong adoption of its AI tools
- At least six brokerages raised their price targets on Shopify, citing confidence in the company’s growth momentum and outlook for the second half of 2026
- Shopify stock (TSX:SHOP) opened trading at C$200.88
Shopify (TSX/NASDAQ:SHOP) won a fresh round of support from Wall Street after the e-commerce software provider reported better-than-expected second-quarter results and issued third-quarter revenue guidance that topped analyst expectations, prompting at least six brokerages to lift their price targets on the stock.
The Ottawa-based company reported second-quarter revenue of US$3.58 billion, up 34 per cent year over year, beating the consensus estimate of US$3.45 billion. Adjusted earnings came in at $0.42 per share, ahead of analyst expectations of $0.40 per share. Shopify also delivered an 18 per cent free cash flow margin, continuing a streak of strong profitability and cash generation.
This article is a journalistic opinion piece that has been written based on independent research. It is intended to inform investors and should not be taken as a recommendation or financial advice.
Shopify President Harley Finkelstein described the quarter as a standout performance.
“This was a monster quarter: more than 30 per cent growth in GMV AND revenue AND gross profit AND free cash flow,” Shopify’s president, Harley Finkelstein, said in a news release.
Investor enthusiasm was further fuelled by Shopify’s outlook for the third quarter. The company expects revenue to grow at a low-30’s percentage rate year over year, above Wall Street expectations for approximately 26 per cent growth. Shopify also forecast gross profit dollar growth in the mid-to-high 20’s percentage range and free cash flow margins in the high-teens to low-20’s.
The stronger-than-expected forecast helped ease concerns that rising artificial intelligence investments could weigh on profitability. Instead, management pointed to accelerating adoption of AI tools and increasing merchant engagement across its platform. AI-driven customer traffic and orders reportedly tripled during the quarter, while daily active users of Shopify’s Sidekick AI assistant increased 3.6-fold from a year earlier.
Following the results, several brokerages raised their price targets:
- Goldman Sachs maintained its Buy rating and increased its target price to US$194 from US$170
- Cantor Fitzgerald maintained a Neutral rating and raised its target to US$145 from US$127
- Citi reiterated its Buy rating and lifted its target to US$196 from US$150
- Barclays maintained a Hold rating and boosted its target to US $145 from US$126
- Evercore ISI kept its Buy rating and increased its target to US$175 from US$135
- ATB Capital Markets (ATB Cormark) maintained a Buy rating and raised its target to US$185 from US$171
Wall Street came away even more bullish on Shopify after the company delivered another quarter of 30 per cent plus growth across key metrics and issued stronger-than-expected guidance for the months ahead.
Don’t forget, “Back to School” season is nearly upon us and Shopify provides internet infrastructure for commerce. The company’s solutions power millions of businesses in more than 175 countries, including household names such as Mattel, Gymshark, Heinz, FTD, Netflix, Kylie Cosmetics, SKIMS and Supreme.
Shopify stock (TSX:SHOP) opened trading more than a per cent higher at C$200.88.
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