Shopify's Q2 revenue was $1.3 billion, with a three-year compound growth rate of 53%

On July 27, local time , Shopify released its second-quarter financial report ending June 30, 2022. The financial report showed that total revenue in the second quarter increased by 16% year-on-year to US$1.3 billion, which means a three-year compound annual growth rate of 53%.

Gross profit was $655.6 million, up 6% from $620.9 million in the same period last year. Adjusted gross profit was $665.0 million, up 6% from $627.0 million in the same period last year.

From the perspective of specific business, Shopify has two main sources of revenue, namely subscription solutions and merchant solutions. Among them, in the second quarter of 2022, subscription solutions revenue was US$366 million, a year-on-year increase of 9.6%. The main reason for the increase was that more merchants joined the Shopify platform; merchant solutions revenue was US$929 million, a year-on-year increase of 28.3%, mainly driven by GMV (gross merchandise volume) growth and the continued strong growth of merchant solutions such as Shopify Payments, Shopify Capital and Shopify Markets. In the second quarter of 2022, Shopify's GMV was US$46.9 billion, a year-on-year increase of 11%.

In the second quarter of 2022, Shopify's adjusted operating loss was $41.8 million, or 3% of revenue, compared with an adjusted operating profit of $236.8 million, or 21% of revenue, in the same period last year. The financial report pointed out that this difference mainly reflects the expansion of Shopify's R&D, sales and marketing teams, as well as its efforts in international marketing and offline performance marketing.

Shopify's official website shows that in terms of stock price, after Shopify released its financial report on July 27, the stock price closed at US$35.24 per share that day, up 11.7% from US$31.55 per share the previous day. At the close of July 28, the stock price continued to rise slightly to US$35.91 per share.

As of July 29, Shopify's stock price has been on a clear upward trend since the release of its second-quarter financial report.

In the second half of 2022, Shopify made adjustments and upgrades in its business. Specifically, it completed the acquisition of e-commerce company Deliverr; launched YouTube Shopping in cooperation with YouTube; and streamlined its staff, reducing the number of employees by about 10%. Shopify said the main reason for the layoffs was the unexpected decline in the company's revenue after the explosive growth caused by the epidemic.

With the addition of Deliverr's world-class software, talent, data and scale, Shopify will be able to provide merchants with a one-stop logistics service, from initial inventory acceptance to smart fulfillment, to fast delivery and easy returns. The partnership with YouTube will enable Shopify's millions of merchants around the world to reach YouTube's more than 2 billion monthly active users.

After a series of recent acquisitions, partnerships, and layoffs, Shopify is confident about its future performance. For the second half of 2022, Shopify believes that as localized subscription pricing and other business plans gain traction, the number of new merchants joining the platform in the second half of the year will be higher than in the first half of the year, and throughout 2022, the annual growth rate of merchant solution revenue will be more than twice that of subscription solutions.

Shopify

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