Home Markets Shopify (SHOP) Q4 2023 Earnings

Shopify (SHOP) Q4 2023 Earnings

by SuperiorInvest

An employee works at Shopify's headquarters in Ottawa, Ontario, Canada.

Chris Wattie | Reuters

buy Shares fell about 13% on Tuesday after the Canadian e-commerce company reported better-than-expected fourth-quarter earnings but gave mixed guidance for the current period.

Here's how the company fared during the quarter compared to consensus expectations from LSEG, formerly known as Refinitiv:

  • Earnings per share: 34 cents adjusted versus 31 cents expected
  • Revenue: $2.14 billion vs. $2.08 billion

Jeff Hoffmeister, Shopify's chief financial officer, attributed the good results to more products being sold on its platform. Gross merchandise volume, or the total volume of merchandise sold on the platform, rose 23% to $75.1 billion, above the $72.1 billion expected by analysts, according to StreetAccount.

Shopify's light guidance for the first quarter overshadowed the pace of earnings and revenue. The company said it expects free cash flow margin to be in the high single digits, below the 13.6% projected by Wall Street.

In a research note published Tuesday, Wedbush analysts noted that Shopify's guidance implies operating income “well below our estimates and consensus.” The company's forecast implies adjusted operating income of $178 million, while consensus estimates are for $382 million, analysts said. Wedbush has a neutral rating on Shopify stock.

Shopify called for first-quarter revenue to grow at a “low 20s percentage rate,” which it said would translate to a year-over-year growth rate in the low to mid-20s when adjusting for the sale of its logistics business. . . In May, the company offloaded its last-mile delivery and fulfillment units to Flexport.

Net income for the quarter was $657 million, or 51 cents per share, compared with a loss of $623 million, or a loss of 49 cents per share, in the prior-year quarter.

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