Shopify full-year revenue jumps 47%, stock reaches record level

By

Jennifer Braun

Published
Feb 13, 2020

Ottawa-based e-commerce company Shopify Inc. saw its stock spike almost 20 percent on Wednesday, after announcing a 47 percent increase in full-year revenue.

For the full year ended December 31, 2019, Shopify’s total revenues hit $1.578 billion, with the company’s CFO, Amy Shapero, attributing the impressive rise to the company’s investments in its product offerings and international expansion.

Subscription solutions revenue grew 38 percent to $642.2 million, while merchant solutions revenue grew 54 percent to $935.9 million.

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Despite the impressive progress, Shopify posted an annual net loss of $124.8 million, or $1.10 per share, compared with $64.6 million, or $0.61 per share, for 2018. It attributed the dip to a tax provision related to a one-time capital gain triggered in the third quarter of 2019.

“2019 was a milestone year for us,” said Tobi Lütke, Shopify’s CEO. “We’ve earned the trust of more than one million merchants, and we are motivated more than ever to keep lowering the learning curve so anyone, anywhere can become an entrepreneur.”

Likewise, Shopify had a tremendous fourth quarter with total revenue reaching $505.2 million, up 47 percent from the comparable quarter in 2018.

Subscription solutions revenue grew 37 percent to $183.2 million, driven primarily by growth in Monthly Recurring Revenue, due to an increase in the number of merchants joining the Shopify platform, while merchant solutions revenue grew 53 percent, to $322 million.

The platform has been investing heavily into its fulfillment network, having revealed plans to pour more than $1 billion into setting up more fulfillment centers in June.

The company further pointed out a range of other achievements driven by its investments in 2019, including the acquisition of 6 River Systems Inc., and the launch of several new merchant features like Shopify Email, Shopify Retail Kit, Shopify Payments in four additional countries, and the launch of 13 additional native language capabilities.

Looking forward, the company currently expects 2020 full-year revenues to total between $2.13 billion to $2.16 billion, with operating loss expected to be in the range of $324 million to $344 million.

For the first quarter of 2020, Shopify currently expects revenues in the range of $440 million to $446 million, and an operating loss in the range of $101 million to $105 million.