Shares in Shopify sank Thursday after the e-commerce firm reported June-quarter earnings that topped analyst estimates. The company's outlook for SHOP stock edged by views.
Released after the market close Wednesday, Shopify earnings came in at 14 cents, swinging to a profit from a year earlier. Also, revenue for the Canada-based company's stock rose 31% to $1.7 billion, Shopify said.
Analysts expected Shopify to report a profit of 6 cents a share on revenue of $1.625 billion. A year earlier, Shopify lost 3 cents per share on revenue of $1.295 billion.
"Management guided Q3 revenue of low-20% revenue growth (ahead of consensus of 18% and flat-to-up operating expense spending (despite offload of Deliverr) as Shopify reinvests into point-of-sale and offline marketing," Mizuho Securities analyst Siti Panigrahi said in a note to clients.
SHOP stock fell 4% to 59.90 in early trading on the stock market today. In Wednesday's regular session, shares fell 7.4%.
Shopify Stock: Logistics Business Sold
The company recently sold its delivery and logistics business to Flexport, easing Wall Street worries over rising capital spending.
Shopify also issued a September-quarter outlook. The company said it expects "revenue to grow at a low-twenties percentage rate on a year-over-year basis, which translates into a year-over-year growth rate in the mid-twenties, when adjusting for the 300 to 400 basis points headwind from the sale of our logistics businesses."
Shopify said second-quarter gross merchandise volume rose 17% to $55 billion. Analysts had predicted that number would come in at $53.4 billion.
Shopify sets up e-commerce websites for small businesses, and partners with others to handle digital payments and shipping. Further, the company is building a U.S. distribution network to store and ship products for its merchant customers.
Heading into the earnings report, Shopify stock had jumped 90% in 2023.
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