Shopify’s Q2 results beat expectations

Shopify Inc. (NYSE: SHOP) beat market expectations for revenue and earnings in the second quarter of 2019, sending the stock climbing over 7% in premarket hours on Thursday.

Total revenue increased 48% year-over-year to $362 million, beating estimates of $350 million.  

GAAP net loss was $28.7 million, or $0.26 per share, compared with $24 million, or $0.23 per share, in the year-ago period. Adjusted net income totaled $15.8 million, or $0.14 per share, topping forecasts of $0.03 per share.  

During the quarter, Subscription Solutions revenue rose 38% to $153 million, driven by higher Monthly Recurring Revenue (MRR) as a result of more merchants joining the Shopify platform. Merchant Solutions revenue grew 56% to $209 million, driven by growth in Gross Merchandise Volume (GMV), Shopify Capital and Shopify Shipping.    

At quarter-end, MRR was $47.1 million, up 34% from the same period last year, with a 26% contribution from Shopify Plus versus 23% last year. GMV grew 51% to $13.8 billion while Gross Payments Volume (GPV) rose to $5.8 billion, accounting for 42% of GMV processed during the quarter.  

Purchases from merchants’ stores coming from mobile devices versus desktop increased during the quarter, accounting for around 80% of traffic and 70% of orders for the second quarter, versus 76% and 66%, respectively, for the same period last year.

Shopify expects revenues of $377 million to $382 million for the third quarter of 2019. The company raised its full-year 2019 revenue outlook to a range of $1.51 billion to $1.53 billion versus the prior range of $1.48 billion to $1.50 billion.

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