The Hamilton Spectator

Shopify Inc. sees boost in profit

Black Friday, Cyber Monday sales cited as firm reports $657M earnings compared with $623M loss a year earlier

- TARA DESCHAMPS

A flurry of holiday sales saw Shopify Inc. end 2023 with strong revenue growth and profits even as consumers continued to grapple with inflation.

The Ottawa-based supplier of ecommerce software reported Tuesday a fourth-quarter profit of $657 million (U.S.) compared with a loss of $623 million a year earlier.

The firm, which keeps its books in U.S. dollars, said its revenue totalled $2.14 billion for the period ended Dec. 31, up 24 per cent from $1.74 billion a year earlier.

It attributed the increase to the Black Friday-Cyber Monday weekend and holiday season, which many expected to be marked with consumers being more careful about spending. However, economic woes weighed little on the sales Shopify saw throughout the season.

The four-day period spanning Black Friday and Cyber Monday alone generated $9.3 billion in sales for Shopify, amounting to 24 per cent growth from the prior year, Harley Finkelstei­n told analysts Thursday.

The company’s president said about 61 million consumers worldwide purchased from brands using Shopify, more than 17,500 merchants made their first sale over the Black Friday-Cyber Monday sales period and more than 55,000 merchants had their highest selling day ever on Shopify.

“Our platform handled a staggering 967,000 requests per second, which is the same as 58 million requests per minute, nearly 80 per cent higher than our peak traffic just two years ago,” he said.

Finkelstei­n has long likened Black Friday and Cyber Monday to the Super Bowl for Shopify.

Ahead of the shopping period this year, he told The Canadian Press he expected inflation, high interest rates and layoffs to make consumers more intentiona­l about what they buy.

“I think ‘less but better’ is probably going to be one of the themes,” he said at the time. “More quality, less quantity, not necessaril­y buying 15 pieces of product, but rather buy three that are more meaningful to you.”

When Statistics Canada reported November retail sales last month, it saw a 0.2 per cent decline, pushing some economists to declare the month a “Black Friday bust.”

Shopify’s earnings told a different story. Its profit amounted to 51 cents per diluted share, up from a loss of 49 cents per diluted share in the last three months of 2022.

On an adjusted basis, Shopify says it earned 34 cents per diluted share, up from adjusted profit of seven cents per share.

However, the results pushed Shopify’s results down almost 12 per cent to $106.02 in afternoon trading. It closed at $104.85.

 ?? SEAN KILPATRICK THE CANADIAN PRESS FILE PHOTO ?? The fourday period spanning Black Friday and Cyber Monday alone generated $9.3 billion in sales for Shopify, amounting to 24 per cent growth from the prior year.
SEAN KILPATRICK THE CANADIAN PRESS FILE PHOTO The fourday period spanning Black Friday and Cyber Monday alone generated $9.3 billion in sales for Shopify, amounting to 24 per cent growth from the prior year.

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