Shopify growth slowing, but still tops projections
Ottawa-based e-commerce firm had revenue of nearly $245M in Q2
Canadian e-commerce darling Shopify Inc. appears to be settling into a pattern of slowing growth.
The Ottawa-based company revealed Tuesday that its yearover-year revenue grew by 62 per cent in the company’s second quarter, down from 68 per cent the quarter before and 75 per cent it posted in the first quarter of 2017.
Shopify has seen its year-overyear revenue growth drop consistently over the past six quarters, even as it unveiled a slew of new features and services for merchants, including a tapand-chip payment reader, instore pickup and multi-channel return and exchange options.
The latest hit came days after Shopify announced its first bricks-and-mortar location will open in Los Angeles in 2019.
The company’s Tuesday earnings report also showed slowing growth in gross merchandising volume (GMV), a key number that measures the total value of merchandise sold through the company. Shopify, which reports its numbers in U.S. dollars, said in the latest quarter GMV grew by 56 per cent to $9.1 billion, down from the 74 per cent increase the measure saw the year before.
Shopify executives didn’t appear alarmed about the GMV slowdown and monthly recurring revenue, which rose by 49 per cent from the year before to hit $35.3 million. Shopify executives, including chief operating officer Harley Finkelstein and founder Tobias Lutke, were also upbeat because the compa- ny beat analyst estimates for revenue and adjusted earnings during the second quarter.
Revenue for the three months ended June 30 was nearly $245 million, up from $151.7 million in last year’s second quarter and well above analysts estimates of $234.6 million, according to Thomson Reuters Eikon.