May 20th, 2024

Shopify shares sink as company posts Q1 loss, forecasts slower revenue growth

By The Canadian Press on May 8, 2024.

Shopify Inc. reported a loss in its latest quarter as its revenue increased 23 per cent compared with a year ago.Shopify Inc. headquarters signage is shown in Ottawa on Tuesday, May 3, 2022. THE CANADIAN PRESS/Sean Kilpatrick

OTTAWA – Shopify Inc.’s shares dropped 19.5 per cent as the company reported a loss in its latest quarter and slower revenue growth for next quarter in its financial outlook.

The e-commerce software company, which keeps its books in U.S. dollars, says its net loss amounted to US$273 million or 21 cents US per diluted share for the quarter ended March 31.

The result for the quarter compared with a profit of US$68 million or five cents US per diluted share in the same quarter last year.

Revenue for the quarter totalled US$1.86 billion, up 23 per cent from US$1.51 billion in its first quarter last year.

The results pushed Shopify’s share price down $20.66 to $85.09 in morning trading on Wednesday.

In its outlook for the second quarter, Shopify says its year-over-year revenue growth will be affected by the sale of its logistics business. It also expects its gross margin to fall half a percentage point from the first quarter.

The company says its merchants solutions revenue amounted to US$1.35 billion in its latest quarter, up from US$1.13 billion a year earlier, while subscription solutions revenue totalled US$511 million, up from US$382 million in the same quarter last year.

On an adjusted basis, Shopify says it earned 20 cents US per diluted share in its latest quarter, up from an adjusted profit of a penny US per share in the first quarter of 2023.

This report by The Canadian Press was first published May 8, 2024.

Companies in this story: (TSX:SHOP)

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