Shopify Q2 Earnings Report: When?
Shopify Reports Q3 2022 Results: Everything You Need to Know
Shopify's Q3 2022 results have excited investors with revenue growing 22% to $1.366 billion, beating Wall Street's estimates.
- Earnings per share came in at 2 cents on an adjusted basis, beating Wall Street's estimate of a 7 cents loss.
- Gross margin was down sharply to just 48.5%, operating margin at negative 3.3%, and net margin at negative 2.2% on a non-GAAP basis.
- Free cash flow was negative $434 million for the quarter, with net income at negative $30 million.
- Merchant Solutions grew twice as fast as subscription solutions, with an attach rate that continues to tick up.
- Shopify payments processed 54% of total gross merchandise development platform, up from 49% last year and even up 113 basis points sequentially.
- Management does not guide for revenue guidance but Wall Street is expecting 16% growth next quarter to $1.6 billion.
- Gross profit will still be under pressure as the company continues to shift more towards Merchant Solutions.
- Keep an eye on gross merchandise value, Fulfillment Network, operating margins, and free cash flow.
- Shopify's price to sales ratio is currently about 8.5, historically a low number, and the company's all-time low Enterprise sales is about 6.4 in 2016.
- The company's price to gross profit ratio is about 16, indicating that Wall Street is still pricing this business at a premium price.
Shopify's revenue is still growing, and the Shopify fulfillment network is getting built out, but the company still has work to do. The future looks bright, but we still have some waiting to do to find out.
Shopify (SHOP) Earnings Report Thursday, October 27th | ORATS Dashboard
Welcome to the ORAPS Earnings Report where we scan for companies with upcoming earnings announcements, check out historical earnings information and find potential options trades.
Scan for Earnings:
- We run a scan on stocks reporting earnings this week
- Total option volume indicator sorted from greatest to least
- Focusing on Shopify as a large cap company in the software application industry reporting earnings on Thursday, October 27th before the open
Earnings and Financials:
- Options market expecting a move of 10.4% in either direction
- This move was breached in four out of the last 12 earnings
- Long straddles were profitable in those cases, while the rest likely yielded profitable short straddles
- The P/E ratio for Shopify is currently 14.1, which is 75.0% under the average for the last 12 earnings observations
- Overlay quarterly financial data by clicking on the ratios below the earn move graph
Finding the Best Option Trades:
- Scan for neutral strategies
- Filter the scan results by S% or smoothed edge
- The highest ranked trade is a long put calendar with strikes at 30.5 expiring on Friday, January 20th and Friday, November 18th for a debit of 1.63 cents
- Theoretical values in more detail
- The distribution edge found by the expected value of the payoff picture on the stock's historical distribution has an edge of 22.7%
- The forecast edge derived from historical volatility has an edge of 23.3%
- The smoothed edge calculated by drawing a best fit curve through the monthly implied volatilities has an edge of 1.2%
- The edge is relative to the mid-market price of the trade
- The payoff graph shows a reward to risk ratio of 1.4 to 1
- The stock price rose 9.7% over the last month while the 30-day implied volatility fell 1.6%
- The average slope of the trend lines is negative
- The heat map on the right side of the graph is green where volatility and slope are undervalued and red where they are overvalued
- Short-term IV and slope are neutral while the long-term is slightly overvalued
To subscribe to the dashboard, go to orats.com and click on the dashboard product page. Thank you for watching and please like and subscribe to our channel for more videos. If you have any questions or issues related to this earnings report, please contact Auto at orats.com.
How Bad Were Shopify Earnings? | Here's What I'm Doing... $SHOP
Shopify's Q2 2021 earnings report showed revenue growth of 16% YoY, missing Wall Street's expectations, and earnings per share on a non-GAAP basis came in at a loss of 3 cents. The company's gross margins were at 51%, while operating and net margins were both negative. However, Shopify's balance sheet supports $7 billion in cash and less than $1 billion in debt. The company saw subscriptions revenue grow by 9.6%, but gross profit only grew by 3.6%, while merchant solutions revenue grew by 18.3%, but gross profit only grew by 7.1%, indicating reverse leverage. The company announced a 10% reduction in its workforce and plans to decelerate its operating expenses. Despite these challenges, Shopify plans to scale its fulfillment network and offer two-day guaranteed delivery to as many merchants as possible. The company is expected to grow at 15-20% in Q3, which is in line with Wall Street's expectations. Shopify's valuation is expensive, but the company is expected to grow faster than its peers. The moat is stable, and the thesis is yellow-flagged. The company's wide moat and optionality make it a solid long-term investment.
Shopify is about 10% of total U.S. e-commerce capital
GMV Up 11 and Adjusted Gross Profit Increased by Nearly 11: A Positive Quarter for Shopify
Shopify, one of the most dominant players in the e-commerce space, has had a better-than-expected quarter, with GMV up 11 and a smaller than expected operating loss. As consumers continue to favor brands on Shopify, the company is playing a crucial role in the businesses of its Merchants.
- Global e-commerce is expected to reach $7 trillion by 2025, and Shopify is a dominant player in that space.
- During the third quarter, more merchants are using more of Shopify's solutions, with the Merchant solution attached rate at 2.14.
- Shopify had a good quarter in terms of revenue, which was $1.4 billion, up 22% on a three-year KAGGER.
- Adjusted gross profit was $681 million, up nearly 11% on a three-year basis.
- Shopify is decelerating year-on-year operating expense growth and has about $5 billion in cash on its balance sheet.
- The company can continue to invest in buyer relationships and going global while being good stewards of capital and good capital allocators.
- Shopify is about 10% of total e-commerce in the US and has both small and large businesses using its platform, making it easier to sell across different services.
- Shopify's Merchants are getting ready for the holiday season, and the company is making it easy for them to find more customers through integrations with various channels.
Overall, Shopify had a positive quarter, with GMV up 11 and adjusted gross profit increasing by nearly 11%. As the company continues to play a crucial role in the businesses of its Merchants, it remains well-positioned for the future of e-commerce.
Is Shopify Stock UNDERVALUED??? | Q3 EARNINGS REVIEW
- Shopify is an e-commerce platform that helps businesses start, run, and grow
- The company has been growing and beat analyst expectations in Q3
- In this article, we will analyze Shopify's Q3 earnings report and conference call to determine if it's a good buy, sell, or hold
Key Drivers for Growth:
- Gross merchandise volume (GMV)
- Shopify payments
- Shopify Capital
- Shopify markets
- Largest part of revenue
- Increased 26% YoY
- Shopify's first-ever retail ecosystem
- Monthly fee paid by businesses of all sizes
- Nine-dollar light to $2,000+ Shopify Plus
- Shopify helps smaller businesses grow, leading to greater revenues
EPS and Gross Profit:
- Shopify beat EPS expectations
- Adjusted gross profit increased by 11% YoY
- Adjusted gross profit kaggar for past 3 years is 46%, showing potential for growth
Total Addressable Market (TAM):
- Solid TAM, but expected to grow massively over time
- Shopify will likely take more market share as they expand
- Currently has $4.9 billion in cash, cash equivalents, and marketable securities
- Lower than last year due to Deliverer acquisition
- Still in a fantastic cash position
Investment in 2022:
- Builder buyer relationships
- Going global
- Going from first sale to full scale
- Simplifying logistics through Shopify fulfillment network
- Shopify is set up for success
- Potential for massive revenue and margin growth
- Investing in key areas to expand and improve relationships with customers
- A good buy for long-term growth potential
SHOP Stock | Shopify Inc Q2 2022 Earnings Call
Good morning and welcome to Shopify's second quarter 2022 conference call. In this call, we will discuss our recent results, future plans, and answer any questions you may have. Our CEO, Toby Lucca, our President, Harley Finkelstein, and our CFO, Amy Shapiro, are all here with us this morning.
Assumptions and Risks
We will be making forward-looking statements on this call, which are subject to risks and uncertainties that could cause actual results to differ from those projected. We undertake no obligation to update these statements except as required by law. You can read about these assumptions, risks, and uncertainties in our press release this morning, as well as in our filings with U.S. and Canadian regulators.
We will also speak to adjusted financial measures, which are non-GAAP measures and not a substitute for GAAP financial measures. Reconciliations between the two are in the tables at the end of our press release. Finally, we report in U.S. dollars, so all amounts discussed today are in U.S. dollars unless otherwise indicated.
Building for the Future
The extraordinary journey that we have been on with merchants continues, as seen in our Q2 results. We continue to grow our merchant base and deliver more value to merchants via our mission-critical tools that prepare them well for the future. Anticipating their future needs is a key reason merchants choose us.
Shopify has always been a company that makes big strategic bets that our merchants demand of us. This is how we win. During the pandemic, we made a bet that retail spend would disproportionately favor e-commerce at a much higher pace than it has. Our belief was that the channel mix, the share of dollars that travel through e-commerce rather than physical retail, would permanently leap ahead. As we built for the digital leap, we staffed our efforts and expanded the company accordingly.
We are making investments to drive top-line and merchant growth by helping merchants build buyer relationships, go global, grow from first sale to full scale, and simplify logistics.
Building Buyer Relationships
We have been investing to extend ways for merchants to connect with more buyers and deepen those relationships across more channels and services. With people shopping in stores again, e-commerce is trending back to a more normalized growth curve. We've seen incredible growth in offline GMV on Shopify as more merchants come to us to modernize their point-of-sale software. Our world-class retail point-of-sale offering, which gives merchants a seamless view of their online and offline operations, is quickly becoming the point of sale of choice.
International selling should be as simple as selling domestically. With our new cross-border management tool, Shopify Markets, merchants can identify, set up, launch, optimize, and manage their international markets from a single store. Our own studies indicate that merchants can drive up to 40% higher conversion rates in international regions by customizing their storefronts for each market to improve the buyer experience for customers.
Grow from First Sale to Full Scale
We are investing to help merchants grow from first sale to full scale. Features such as Shopify Shipping and Shopify Capital make commerce easier for entrepreneurs, while features like Shopify Functions empower merchants to extend the platform through customization.
Our vision in building Shopify Fulfillment Network for the long term starts with simplifying the end-to-end supply chain at three critical stages that are really hard or close to impossible for independent businesses across freight, distribution, and fulfillment as inventory moves from port to porch. When this is done well, we greatly simplify logistics for merchants and enable them guaranteed delivery times, which provides a meaningful uplift to conversion.
In conclusion, Shopify remains in an enviable position in a massive, growing market as an enabler of multi-channel commerce. We are making investments to drive top-line and merchant growth, and we are confident that these investments will generate improved cost of customer acquisition, expand merchant lifetime values, and increase our merchant's odds of success by bringing more of Shopify to more merchants. Thank you for joining our call today.
Shopify Stock Earnings: The Good and The Bad | SHOP Stock
In this earnings video, we will discuss Shopify's latest earnings report that was released before the market opened. The stock has seen a 4-5% increase, and we will analyze the factors behind it.
- Total revenue increased 22% to $1.4 billion compared to the prior year, beating the estimated $1.34 billion.
- Monthly recurring revenue increased 8% to $107 million, which is flat quarter-over-quarter.
- Subscription solutions increased 12% year-over-year to $376.3 million.
- Gross merchandise volume increased 11% to $46.2 billion, with a 54% processed in the quarter.
- Gross payment volume grew to $25 billion, a tiny bit more than last quarter.
- Gross profit dollars grew 9% to $662.3 million, reflecting a greater mix of lower margin Merchant solution revenue and increased investments in their Cloud infrastructure.
- Adjusted gross profit grew 11% to $681.8 million.
- Operating loss increased to $345.4 million, representing 25% of revenue versus a loss of $4.1 million or 0.4% of revenue the same quarter last year.
- Adjusted net loss was $30 million or a loss of 2 cents, beating the expected loss of 7 cents.
- Operating expenses are much higher than last year and quarter-over-quarter.
- Stock-based compensation is at $407 million for the nine months ending, a significant increase from last year.
Overall, Shopify had an okay quarter, beating expectations and managing to navigate through the current economic environment pretty well. While there are some concerns regarding operating expenses and losses, it's important to keep an eye on these factors for the long term. As for the stock, it has seen a slight increase, but it remains to be seen how it will perform in the future.
- Online Shopify Stores: Boost Your E-commerce Game
- Shopify's Top Plan Features
- Seamless Shopify-Zazzle Integration
- Polen Joins Shopify Plus Ecosystem
- Adding Shopify's Buy Now Button
- Effortlessly Integrate Shopify Ecommerce with Wordpress
- Legitimacy of Prebuilt Shopify Stores
- Managing High-Risk Orders on Shopify
- Shopify Go-Live Checklist: Must-Do's
- Adding AliExpress Items to Shopify