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Shopify Trades Lower After Missing Revenue And Earnings Estimates

Published 28/10/2021, 14:20
Updated 28/10/2021, 14:20
© Reuters.

© Reuters.

By Daniel Shvartsman

Investing.com -- Shopify (NYSE:SHOP) stock dropped 3.5% premarket as the e-commerce software provider missed estimates on both top and bottom lines, with concerns of a post-pandemic hangover rearing their head.

The Canadian company reported $0.81 in adjusted net income per share (adjusting out a big equity gain), and revenues of $1.12 billion, off from estimates of $1.24/share and $1.15 billion. The company’s outlook for Q4 was imprecise, but maintained the theme of moderating growth from 2020. “We continue to expect the fourth quarter to contribute the largest share of full-year revenue, and that the revenue spread will be more evenly distributed across the four quarters than it has been historically,” they said, while nodding to the challenges around the supply chain in retail more broadly. Shopify’s Q4 has accounted for 32-33% of yearly revenue the last two years, and current estimates are for 1.37B in Q4 revenue, which would amount to 30% of this year’s revenue.

Shopify crossed a notable milestone at $400 billion in cumulative gross merchandise value, doubling that figure in the last 16 months.

The company’s shares are trading hands at $1300 premarket, up 15% from the start of the year but down 3.8% from yesterday’s close and 21% from this year’s highs. The company of course was a huge 2020 winner, returning over 180% for shareholders.

This sets a tone for today’s post-market report from Amazon (NASDAQ:AMZN), the leading e-commerce retailer, which missed revenue expectations in Q2 and has been off their highs as well.

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