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A Big Earnings Beat for Shopify, But How High Can It Go?

Today's video will go over Shopify's (NYSE: SHOP) recent earnings report and talk about Shopify Pay and Audience Network and what they could mean for the future of Shopify. I believe Shopify is nowhere near its full potential and could still become a multibagger. You can find the video down below.

Earnings recap

The company reported Q2 revenue of $1.12 billion, up 57% year over year, subscription solutions of $334 million, up 70% YOY, and merchant solutions of $785 million, up 52% YOY. The impressive numbers continued:

  • GMV for the second quarter was $42.2 billion, up 40% YOY.
  • GPV grew to $20.3 billion, up 45% YOY.
  • Adjusted operating income grew 16% to $236.8 million.
  • Adjusted net income was $284.6 million, or $2.24 per diluted share.

The company expects to continue growing revenue rapidly in 2021, but not as rapidly as in 2020.

Now what

Shopify is firing on all cylinders, and there are no signs of it slowing down. It is becoming more of a platform for entrepreneurs to start their companies. With Shop Pay it is entering the payment processing world, which is heavily dominated by PayPal; Shop Capital helps out small businesses with loans that banks refuse to offer; and with Shopify Audiences, a data exchange network that uses aggregated conversion data across all opted-in merchants on Shopify to generate a custom audience for a given merchant's product, Shopify could dip its toe into the advertising business.

For the full insights do watch the video below.

*Stock prices used were the closing prices of July 28, 2021. The video was published on July 29, 2021.

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Neil Rozenbaum owns shares of Shopify. The Motley Fool owns shares of and recommends PayPal Holdings and Shopify. The Motley Fool recommends the following options: long January 2022 $75 calls on PayPal Holdings, long January 2023 $1,140 calls on Shopify, and short January 2023 $1,160 calls on Shopify. The Motley Fool has a disclosure policyNeil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.


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