Shopify Inc. (NYSE: SHOP) reported its second quarter financial results and topped analysts’ estimates in both revenue and earnings. Despite beating estimates, Shopify shares were trading 8% lower during pre-market hours on Tuesday after the Company had reposted its corrected financial results.
For the second quarter, Shopify reported revenue of USD 245 Million, increasing 62% year over year and beating estimates of USD 234 Million. The Company reported an EPS of USD 2 cents, topping analysts’ estimates of an EPS loss of USD 3 cents.
Subscription solutions revenue grew by 55% to USD 110.7 million in the quarter. Shopify says this was driven primarily by its strong growth in Monthly Recurring Revenue (MRR), which was driven by an increase in the increasing number of merchants joining the platform.
MRR for the quarter was USD 35.3 Million, increasing 49% year over year. Shopify Plus contributed USD 8.1 Million to the MRR as opposed to 18% the same quarter last year.
Merchant solutions revenue by 68% to USD 134.2 Million, driven by growth of Gross Merchandise Volume (GMV) and the growth in Shopify Capital and Shopify Shipping.
Shopify continued to expand its shipping platform, as adoption of the service increased to more than a third of eligible merchants in the U.S. and Canada.
GMV for the quarter was USD 9.1 Billion, increasing 56% year over year. Gross Payments Volume (GPV) grew to USD 3.6 Billion, increasing 38% year over year and accounting for 40% of GMV processed in the quarter.
The Company’s mobile platform continued to grow in the quarter, as mobile orders accounted for 76% of traffic and 66% of orders, increasing by 4% and 6%, respectively.
“The diversity of our revenue drivers and of our merchant base contributed to our strong revenue growth this past quarter,” stated Amy Shapero, Shopify’s Chief Financial Officer. “Our mission, our technology and our growth model position us, and our merchants, to thrive in the face of massive changes to retail. We built the Shopify platform to meet the many and varied needs of all types of merchants, whether they are makers or curators, entrepreneurs or household brands. This presents us with an expansive opportunity set that we will continue to invest in with a view to even greater success over the long term.”
For the third quarter, Shopify forecasts revenue in the range of USD 253 Million to USD 257 Million on an adjusted operating loss in the range of USD 9 Million to USD 11 Million. As for the full year, the Company forecasts revenues in the range of USD 1.015 Billion to USD 1.025 Billion on an adjusted operating profit of USD 0 to USD 5 Million.