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2mo ago

Shopify Posts Strong Q4 Revenue Growth but Faces Profitability Concerns

The e-commerce giant exceeded revenue expectations in Q4 2024, but its Q1 2025 guidance and rising costs raised investor concerns.

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Shopify Inc. headquarters signage in Ottawa on Tuesday, May 3, 2022.
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Overview

  • Shopify reported a 31.2% year-over-year revenue increase for Q4 2024, reaching $2.81 billion, surpassing analysts' expectations of $2.73 billion.
  • The company's gross merchandise volume (GMV) grew by 26% in Q4 to $94.46 billion, marking its highest growth in three years.
  • Shopify's AI-driven tools, including 'Shopify Magic' and the Sidekick assistant, have attracted merchants but contributed to increased operating expenses.
  • Despite strong Q4 results, Shopify's Q1 2025 guidance predicts mid-twenties revenue growth and low-twenties gross profit growth, below some analysts' expectations.
  • The company has captured 12% of the U.S. e-commerce market and continues to expand its enterprise partnerships with brands like Reebok and Warner Music Group.