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Shopify's (SHOP) Q2 Earnings to Gain from Strong Merchant Base
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Shopify (SHOP - Free Report) is expected to have benefited from its expanding merchant base in second-quarter 2022, set to be reported on Jul 27.
Accelerated adoption of Shopify products such as Shop Pay, Shop Pay Installments and Shopify Balance is likely to have driven the company’s top line in the to-be-reported quarter.
However, top-line growth is expected to have suffered from the absence of government stimulus and slower growth in e-commerce compared with COVID-triggered acceleration in the year-ago quarter.
Click here to know how Shopify’s overall second-quarter results are likely to be.
Strategic Integrations Boosts Prospect
Increased focus on expanding its merchant base to benefit from the e-commerce boom is anticipated to have aided Shopify’s second-quarter 2022 performance.
In the first quarter of 2022, Gross Merchandise Volume (GMV) rose 16% year over year, reaching $43.2 billion. The trend is likely to have continued in the to-be-reported quarter.
Shopify’s rich partner ecosystem might have also acted as a growth driver in the to-be-reported quarter.
The Twitter sales channel allows merchants to connect with consumers directly from their Twitter profiles. Shopify noted that it is the first time a commerce platform has partnered with a social media company.
The integration with Apple enables shoppers to use Apple smartphones against the terminal to pay for goods. While this may not be a new feature in retail but Apple’s recent Pay Later installments added a whole new dimension to retail marketing.
Shopify’s Google feature syncs local inventory data with the Shopify platform to let customers know when a particular product is in stock.
In the last reported quarter, gross payment volume (GPV) reached $22 million, constituting 51% of GMV.
The Zacks Consensus Estimate for GPV stands at $25.2 million, indicating 24.5% growth from the figure reported in the year-ago quarter.
The GPV in the to-be-reported quarter is expected to have been driven by a strong performance by merchants on Shopify Payments, new merchant adoption, Shop Pay penetration gains, and significant expanded payment penetration by merchants.
The Zacks Consensus Estimate for Merchant Solutions revenues stands at $980 million, indicating 24.8% growth from the year-ago quarter.
Subscription Solutions market growth in the to-be-reported quarter is expected to have been driven by more global merchants joining Shopify, aggressive investments in sales and marketing, and the introduction of new commercial initiatives.
The consensus mark for Subscription Solutions revenues is pegged at $365 million, suggesting 9.3% growth from the year-ago quarter.
Image: Bigstock
Shopify's (SHOP) Q2 Earnings to Gain from Strong Merchant Base
Shopify (SHOP - Free Report) is expected to have benefited from its expanding merchant base in second-quarter 2022, set to be reported on Jul 27.
Accelerated adoption of Shopify products such as Shop Pay, Shop Pay Installments and Shopify Balance is likely to have driven the company’s top line in the to-be-reported quarter.
However, top-line growth is expected to have suffered from the absence of government stimulus and slower growth in e-commerce compared with COVID-triggered acceleration in the year-ago quarter.
Shopify Inc. Revenue (TTM)
Shopify Inc. revenue-ttm | Shopify Inc. Quote
Click here to know how Shopify’s overall second-quarter results are likely to be.
Strategic Integrations Boosts Prospect
Increased focus on expanding its merchant base to benefit from the e-commerce boom is anticipated to have aided Shopify’s second-quarter 2022 performance.
In the first quarter of 2022, Gross Merchandise Volume (GMV) rose 16% year over year, reaching $43.2 billion. The trend is likely to have continued in the to-be-reported quarter.
Shopify’s rich partner ecosystem might have also acted as a growth driver in the to-be-reported quarter.
This Zacks Rank #3 (Hold) company has made strategic integrations with major tech companies to provide new services, like the Twitter sales channel, Apple’s (AAPL - Free Report) iPhone tap-to-pay feature and Alphabet’s (GOOGL - Free Report) local inventory integration with Google. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Twitter sales channel allows merchants to connect with consumers directly from their Twitter profiles. Shopify noted that it is the first time a commerce platform has partnered with a social media company.
The integration with Apple enables shoppers to use Apple smartphones against the terminal to pay for goods. While this may not be a new feature in retail but Apple’s recent Pay Later installments added a whole new dimension to retail marketing.
Shopify’s Google feature syncs local inventory data with the Shopify platform to let customers know when a particular product is in stock.
In the last reported quarter, gross payment volume (GPV) reached $22 million, constituting 51% of GMV.
The Zacks Consensus Estimate for GPV stands at $25.2 million, indicating 24.5% growth from the figure reported in the year-ago quarter.
The GPV in the to-be-reported quarter is expected to have been driven by a strong performance by merchants on Shopify Payments, new merchant adoption, Shop Pay penetration gains, and significant expanded payment penetration by merchants.
The Zacks Consensus Estimate for Merchant Solutions revenues stands at $980 million, indicating 24.8% growth from the year-ago quarter.
Subscription Solutions market growth in the to-be-reported quarter is expected to have been driven by more global merchants joining Shopify, aggressive investments in sales and marketing, and the introduction of new commercial initiatives.
The consensus mark for Subscription Solutions revenues is pegged at $365 million, suggesting 9.3% growth from the year-ago quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.