How Shopify Is Getting Back on Track With Q1 Earnings
Shopify reported better than expected quarterly results before the opening bell on Wednesday.
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Shopify Inc. (NYSE: SHOP | SHOP Price Prediction) reported its most recent quarterly results before the opening bell on Wednesday. The up-and-coming e-commerce company posted $2.01 in earnings per share (EPS) and $988.6 million in revenue, which was better than consensus estimates that called for $0.73 in EPS and revenue of $865.48 million. The first quarter of last year reportedly had $0.19 in EPS on $470 million in revenue.
During the latest quarter, Subscription Solutions revenue grew 71% to $320.7 million. This increase was driven primarily by an increase in the number of merchants joining the Shopify platform.
Merchant Solutions revenue grew 137%, to $668.0 million, driven primarily by the growth of gross merchandise volume (GMV).
As of March 31, monthly recurring revenue (MRR) increased 62% year over year to $89.9 million, up from $55.4 million at the end of March 2020. Shopify Plus contributed $23.1 million, or 26%, of MRR.
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GMV for the first quarter was $37.3 billion, an increase of $19.9 billion, or 114%, over the first quarter of 2020. Gross payments volume grew to $17.3 billion, which accounted for 46% of GMV processed in the quarter, versus $7.3 billion, or 42%, for the first quarter of 2020.
Cash, cash equivalents and marketable securities totaled $7.87 billion at the end of the quarter, up from $6.39 billion at the end of the previous fiscal year.
Shopify did not get into the specifics of guidance for the second quarter. However, consensus estimates call for $0.83 in EPS on $949.78 million in revenue.
Shopify stock traded up about 4% on Wednesday, at $1,201.24 in a 52-week range of $595.03 to $1,499.75. The consensus price target is $1,441.21.
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Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics. Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications. A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.
