- Shopify stock jumped more than $10 at the open of trading Thursday after it reported strong increases in total revenue and profits in its latest financial results
- Shopify’s total revenue jumped 25 per cent to $1.7 billion compared to the previous year
- The company’s gross profit increased 36 per cent to $901 million compared to the same period in 2022
- After closing at C$67.66 Wednesday, Shopify shares opened at $78.35 Thursday morning
Shopify Inc. (TSX:SHOP) (NYSE:SHOP) stock jumped more than $10 at the open of trading Thursday after it reported strong increases in total revenue and profits in its latest financial results.
The provider of internet infrastructure for commerce revealed total revenue jumped 25 per cent to $1.7 billion compared to the previous year, and gross profit increased 36 per cent to $901 million compared to the same period in 2022.
Shopify stock was trading at $78.51 per share at 10 am ET after the company announced its financial results for the third quarter that ended Sept. 30.
“Our third-quarter results demonstrate the progress we are making to further solidify Shopify’s position as the global leader in commerce,” Harley Finkelstein, president of Shopify, said in a news release. “Our ability to help our merchants succeed in any economic environment by delivering innovative product solutions, has not only built strong trust with our merchants but has positioned Shopify for sustained growth and profitability for the future. As we look forward to the busiest shopping season of the year, we’re confident that our unified commerce platform empowers our merchants with the tools they need to seize every opportunity and achieve greater success.”
Other financial highlights from Shopify’s third quarter include:
- Gross merchandise volume (GMV) increased 22 per cent to $56.2 billion, an increase of $10.0 billion over the third quarter of 2022.
- Merchant solutions revenue increased 24 per cent to $1.2 billion compared to the previous year, driven by the growth of GMV and Shopify Payments.
- Gross payments volume grew to $32.8 billion, representing 58 per cent of GMV processed in the quarter, versus $25.0 billion, or 54 per cent, for the third quarter of 2022.
- Subscription solutions revenue increased 29 per cent to $486 million compared to the year before.
- Gross margin for the quarter was 52.6 per cent compared to 48.5 per cent in the third quarter of 2022.
- Operating income was $122 million, or 7 per cent of revenue, compared to an operating loss of $346 million, or 25 per cent of revenue, for the same period a year ago, driven primarily by higher gross profit and lower operating expenses in the quarter.
“We’re extremely pleased with our financial performance this quarter, which is a testament to the resilience and adaptability of our platform and our merchants,” Shopify Chief Financial Officer Jeff Hoffmeister said in a statement. “Our results showcased the durability of our business model as we delivered a compelling combination of both top-line growth and profitability, with revenue growing 25 per cent year-over-year and free cash flow margin reaching 16 per cent. We will continue to operate with discipline, thoughtfully investing in the huge opportunities ahead across regions, products, and channels to help merchants capture every opportunity every step of the way.”
Shopify is the global commerce company that provides essential internet infrastructure for commerce, offering trusted tools to start, scale, market, and run a retail business of any size. Shopify powers millions of businesses in more than 175 countries and is used by such brands as Mattel, Gymshark, Heinz, FTD, Netflix, Kylie Cosmetics, SKIMS and Supreme.
After closing at C$67.66 Wednesday, Shopify shares opened at $78.35 Thursday.
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