Shopify has recently raised its spending on the platform to upgrade it, and in turn, boost top line growth. The addition of numerous merchant-friendly tools is expected to contribute to a bigger merchant base.
The Ottawa-based firm has also been making investments into newer technologies including augmented reality and virtual reality, the results are which are likely to be seen in the Q1 Gross Merchandise Volume.
Separately, the integration of local languages, as well as the acquisition of TicTail, may be seen as an effort to expand operations outside its core markets.
However, the higher expense required to improve the platform is expected to weigh on the bottom-line results. Analysts have projected a loss of 6 cents per share during the quarter.
Higher competition
Higher spending on the platform was inevitable for the company, given the rising completion of the industry. Apart from tradition rivals including Square (NYSE: SQ), tech giants including Facebook (NASDAQ: FB) and Microsoft (NASDAQ: MSFT) are reportedly planning to launch similar services.
The “drastic changes” expected in the Shopify landscape had earlier this month prompted research firm, Citron, to give bearish comments on the stock. The comments sent the shares down over 6%.
The stock has gained 63% in the year-to-date period and 78% in the trailing 52 weeks.