’Reddit is built for this moment’ - Stock soars on crushed earnings
Investing.com - Shopify (NASDAQ:SHOP) has unveiled second-quarter revenue growth estimates that topped analysts’ estimates, as the e-commerce group pushes to entice sellers to its platform even as it grapples with broader economic uncertainty.
But U.S.-listed shares in the company slumped by more than 8% in premarket U.S. trading on Thursday following lower-than-anticipated first-quarter profit.
Canada-based Shopify said it now expects revenue to increase in the mid-twenties percentage rate on a year-on-year basis in the current quarter, compared with Wall Street projections of 22.4%, according to LSEG data cited by Reuters.
Sales for the quarter ended on March 31 rose by 27% to $2.36 billion, thanks to an uptick in gross merchandise value and monthly recurring revenue. Bloomberg consensus expectations had seen the figure at $2.34 billion.
Operating income also jumped to $203 million, versus projections of $207.6 million.
Expenses, particularly in marketing and research and development, increased, partly offsetting a decline in administrative costs. Group-wide, operating expenses came in at $966 million, slightly above forecasts of $962.3 million.
"Our first-quarter results confirm two clear facts. First, we are delivering both growth and profitability at scale. Second, businesses perform better on Shopify, regardless of market conditions," said Shopify President Harley Finkelstein in a statement. "We built Shopify for times like these."
As a percentage of revenue, second quarter operating expenses are tipped to be between 39% to 40%.