Shopify Q3 results beat on adjusted EPS but miss key growth metrics
Shopify reported Q3 revenue of $3.742 billion, up 31.6% year over year, and adjusted EPS of $0.49, which exceeded the $0.47 estimate. Gross merchandise volume and subscription revenue fell short of expectations, although Merchant Solutions revenue and operating income were ahead of forecasts. Shopify guided for Q4 revenue growth in the low 30% range and gross profit dollar growth in the high 20% range.
Why it matters
The weaker GMV and subscription results triggered a sharp decline in Shopify shares despite stronger profit and cash-generation figures. The Q4 outlook also indicates that gross profit growth is expected to trail revenue growth, extending investor concerns about business mix and growth momentum.
Key facts
- 1Q3 revenue was $3.742 billion, representing 31.6% year-over-year growth. rttnews.com
- 2Adjusted Q3 EPS was $0.49 versus an estimate of $0.47. finance.biggo.com
- 3Operating income increased 66% to $568M. finance.biggo.com
- 4Shopify forecast Q4 revenue growth in the low 30% range and gross profit growth in the high 20% range. finance.biggo.com
- 5Free cash flow reached $816 million, producing a 22% free cash flow margin. 247wallst.com
Open questions
- Reports give different Q3 GMV estimates on the same basis: $120.08B, and, versus $120.03B.
- Reports characterize the revenue comparison differently: gives an estimate of $3.75B, while gives an estimate range of $3.75B-$3.77B; some reports describe revenue as in line while others call it a miss.
Summary written by AlphAI AI Desk from 12 of 12 sources. Not investment advice. Figures are as stated by the linked sources.