shopify q2 earnings 2021
Shopify's CEO, Harley Finkelstein, and CFO, Amy Shapiro, recently held a conference call to discuss the company's Q2 results. They made forward-looking statements based on assumptions and acknowledged the risks and uncertainties that could affect the company's projected results. Despite this, Shopify remains in an enviable position as a leading provider of multi-channel commerce tools.
Finkelstein outlined the company's major investments in driving top-line and merchant growth, which include helping merchants build buyer relationships, go global, grow from first sale to full scale, and simplify logistics. Shopify has been investing in ways for merchants to connect with more buyers and deepen those relationships across more channels and services. The company has seen incredible growth in offline GMV on Shopify, and its retail point of sale offering has become the point of sale of choice for many top-tier brands.
Shopify has also been investing in helping merchants go global, which involves simplifying international selling. The company's new cross-border management tool, Shopify Markets, has helped merchants identify, set up, launch, optimize, and manage their international markets from a single store.
Shopify is also investing in helping merchants grow from their first sale to full scale. The company has significantly enhanced its B2B solution, which allows merchants to use the same store to sell B2B as they would for direct-to-consumer sales. This has enabled Shopify to penetrate its merchandise more deeply and enter a new market of merchants who conduct only B2B transactions.
Lastly, Shopify is simplifying logistics through its Shoplifefulfillment network. The company is simplifying the end-to-end supply chain at three critical stages: freight, distribution, and fulfillment. By leveraging software and machine learning, Shopify is able to simplify distribution and enable timely fulfillment with minimal inventory commitment from merchants. This has allowed Shopify to offer affordable and timely fulfillment, which has been nearly impossible for independent businesses to do on their own.
Overall, Shopify remains well-positioned for long-term success, with strong investments in driving top-line and merchant growth, simplifying logistics, and helping merchants go global.
SHOP Stock | Shopify Q2 2021 Earnings Call
Shopify held its second quarter 2021 conference call with its CEO, president, and CFO, discussing the company's performance, achievements, and future investments. The call covered various topics, including the growth of GMB, the expansion of the Shopify platform, and the company's efforts towards improving merchant success.
- Shopify's momentum continued in the second quarter, with strong commerce trends prevailing and more merchants joining and succeeding on the platform.
- Physical stores in many regions reopened their doors, and GMB reached its highest level ever.
- Shopify remains the go-to platform for entrepreneurs worldwide to launch and grow their businesses.
- Merchants are expanding their presence through social commerce and key partnerships with Google, Facebook, and Instagram.
- Shopify is leveraging its entire ecosystem to create a global retail operating system for the future of commerce.
- Shopify's subscription solutions revenue increased 70% over the same period last year, largely due to strong growth in MRR.
- Merchant solutions revenue grew 52% over Q2 2020, driven primarily by GMB expansion.
- Shopify's three key areas of investment for 2021 include Shopify Fulfillment Network, Shop, and International Expansion.
Shopify's strong performance in the second quarter of 2021 indicates that the company is well-positioned to continue its growth and expansion in the future. With a focus on merchant success, the Shopify platform continues to provide entrepreneurs with the tools they need to succeed in the modern retail era. The company's investments in Shopify Fulfillment Network, Shop, and International Expansion show a commitment to improving the platform's capabilities and providing merchants with the best possible experience.
Shopify (SHOP) Q2 Earnings Analysis | Has SHOP Stock Finally Bottomed?
Shopify Q2 earnings show losses are accelerating and growth is declining, but the stock is up over 5%. Is this a sign that overvalued speculative growth stocks during the pandemic have finally started to find a bottom?
- Shopify's stock is down over 75% in the last year and year-to-date, but still has a forward price-to-earnings ratio over 300 and trades at a premium compared to less overhyped peers.
- Shopify is implementing cost-cutting efforts, but analysts are still expecting the company to accelerate into mid-20s to 30% growth on the revenue side, which seems ambitious considering the recent softening of demand.
- Shopify's customers, mostly small business owners, likely had a pull forward in demand during the pandemic, but the vast majority will end up canceling and failing at business, which makes it hard to believe they can achieve those growth rate targets.
- The company increased their sales and marketing spend by over 50% year over year, and got just 17% back on that top line, which does not bode well for future quarters.
- Shopify's net loss has accelerated, and they made some bad speculative bets, but they are still well-capitalized from a balance sheet perspective, having over six billion dollars of cash and almost no liabilities.
- Despite the bad earnings report, the stock is up, which is somewhat of a bullish sign for the market in the short term.
Is Shopify Stock A Buy After Q2 Earnings? | SHOP Stock
In this earnings video, we will discuss Shopify's performance in the second quarter. Despite recent layoffs, the stock is up 7%, and the company plans to invest aggressively in its business.
- Shopify Editions offers new capabilities to unlock greater value across the platform.
- Total revenue in Q2 grew 16% YoY to $1.3 billion, with a three-year CAGR of 53%.
- MRR was $107.2 million, up 13% YoY.
- Gross merchandise volume was $46.9 billion, up 11% YoY.
- Merchant solutions grew 18% YoY to $928.6 million.
- Operating loss was $190.2 million, compared to an income of $139.4 million in the same quarter last year.
Shopify expects 2022 to be a transition year due to persistent high inflation, but its multi-channel capabilities and strong value proposition will continue to help merchants. The company plans to position itself well for the future of commerce.
Overall, it was an okay quarter for Shopify, with a meh outlook for this year. However, as long-term investors, it's important to focus on the future and the company's strategic investments.
[SHOP stock] Shopify Q2 2021 Earnings Call (7/28/21)
- Welcome to the Shopify Second Quarter 2021 Financial Results Conference Call
- Shopify CEO, Harley Finkelstein, President, Toby Lutke, and CFO, Amy Shapiro, present
- Forward-looking statements will be made and non-GAAP measures will be discussed
- GMB reached its highest level ever in Q2 as physical stores reopened and buyers value convenience
- Merchants using Shopify are well-prepared to make commerce happen online, in-store, or through apps
- Retail point-of-sale GMB is nearly back to pre-COVID levels as physical stores reopen
- Shopify is the go-to platform for entrepreneurs to launch and grow their businesses
- Social commerce is expanding through partnerships with Google, Facebook, and Instagram
New Features and Solutions:
- Shopify's online shopping assistant, Shop, is built for easy mobile shopping with buyer-friendly features
- Shopify Capital funded a record $363 million for merchants in Q2 and reinforced trusted relationships
- Shopify Shipping and Fulfillment Network complete the cart experience for merchants and buyers
- Shopify Plus continues to grow with large brands turning to Shopify to make the complex simple
- Shopify Unite announced major upgrades to the platform to build the internet's commerce infrastructure
- Revenue in Q2 was up 57% YoY to $1.1 billion, driven by strong performance from both subscription and merchant solutions
- Subscription solutions revenue increased 70% YoY to $334.2 million largely due to strong growth in MRR
- Merchant solutions revenue grew 52% YoY to $785.2 million, driven primarily by GMV expansion and increased adoption of Shopify payments and capital
- Adjusted gross profit dollars grew 64% over last year's Q2 to $627 million, contributing to strong adjusted operating earnings
- Adjusted net income for the quarter was $284.6 million, excluding a $778 million unrealized net gain on equity investments
- Cash, cash equivalents, and marketable securities balance was $7.76 billion on June 30th, giving Shopify financial flexibility
- Shopify's key areas of investment in 2021 are Shopify Fulfillment Network, Shop, and International Expansion
- Focus remains on building a product that offers merchants a delightful experience and optimizes the network of nodes and partners
How Bad Were Shopify Earnings? | Here's What I'm Doing... $SHOP
Shopify's recent earnings report has caused a stir among shareholders as the stock fell 15% yesterday but climbed again today. In this article, we will review the company's earnings report and analyze its performance.
Shopify's revenue came in at about $1.3 billion, a 16% growth over the same time last year, missing Wall Street's expectations. Merchant solutions, one of Shopify's revenue streams, was expected to grow twice as fast as subscription solutions, but it only grew at about 1.9 times.
Earnings per share:
On an on-gap basis, Shopify lost 3 cents per share, missing Wall Street's expectations. Gross margins came in at about 51%, while operating and net margins were both negative.
Free cash flow:
Shopify's free cash flow went from slightly positive to losing about $200 million, and net income, on a non-gap basis, went from a gain of $285 million to a loss of $38 million.
Subscription solutions vs. merchant solutions:
Subscription solutions saw revenue grow 9.6%, while gross profit grew only 3.6%. Merchant solutions' revenue grew 18.3%, but gross profit grew only 7.1%. This indicates a lack of leverage, and the company needs to reverse this trend.
Adjusted operating expenses were up 85%, and the company's operating income went from a gain of $140 million to a loss of $190 million. The company is taking steps to correct this by cutting 10% of its workforce.
Shopify's gross merchandise volume growth is expected to continue to be impacted by inflation, but it should grow faster than the broader retail market. The number of new merchants joining in the second half of this year is expected to be larger than those who joined in the first half. Merchant solutions should grow more than twice as fast as subscriptions, and gross merchandise and revenue growth will be evenly distributed across all four quarters. The company is cutting back on spending to decelerate its operating expenses.
Shopify trades at about 8.2 times sales on a trailing basis and 6.4 times sales on a forward basis. It is expensive relative to its peers but is expected to grow faster than those players.
Shopify's recent earnings report has raised concerns among shareholders, but the company is taking steps to correct its course by cutting back on spending and cutting its workforce. The moat is stable, and if Shopify can get its fulfillment network right, it can be a meaningful growth driver. The thesis overall has a yellow flag, but the company still has a wide mode. As a shareholder, the author is not selling any shares but is also not adding to their position at this point.
SHOP stock & their terrible 2Q earnings update! Should I BUY MORE SHOPIFY or is it a DISASTER?
Shopify, a leading e-commerce platform, recently reported their Q2 2022 results, which disappointed some investors. Despite this, the stock increased by 12%, possibly due to the Federal Reserve raising interest rates. Shopify's revenue grew by 15%, with gross profit only growing by 5%. The company also announced a 10% cut to their staff, resulting in a significant loss. While Shopify is still taking market share, their valuation and growth rate remain a concern for investors. The stock price has decreased by over 50%, and an investment in Shopify requires a hypothetical valuation framework to determine the potential upside. After considering multiple scenarios, the potential return does not seem compelling, and personal capital may be better invested elsewhere.