CANADA’S Shopify topped Wall Street estimates for fourth-quarter revenue and profit on Tuesday (Feb 13), riding on demand for its e-commerce services from merchants during the holiday shopping season.
However, the company’s US-listed shares, which had more than doubled last year, fell nearly 8 per cent in trading before the bell.
“Shopify reported a strong quarter and exceeded revenue growth expectations. While guidance for the first quarter was also healthy, it may not be enough given high investor expectations,” said Gil Luria, analyst at DA Davidson.
Total revenue rose 24 per cent to US$2.14 billion for the three months to December, higher than analysts’ average estimate of US$2.08 billion, according to LSEG data.
On an adjusted basis, Shopify earned 34 US cents per share, beating expectations of 31 cents.
Shopify, which offers tools and services for businesses to set up their online stores, has launched new tools and offerings along with artificial intelligence products to stay ahead in a competitive e-commerce space.
Merchants on the platform reached a record of US$9.3 billion in sales over the Black Friday-Cyber Monday weekend, the company had said in November, a 24 per cent increase from a year earlier.
The company expects first-quarter revenue to grow at a low-20s percentage rate, while analysts were expecting a 20 per cent rise. REUTERS