After a surprise loss in the third quarter despite hitting two major milestones, shares of Shopify fell 4.6 percent in premarket trading on Wall Street today (Oct. 29).
Adjusted loss came in at 29 cents per share, down from adjusted net income of 5 cents per share a year ago. On an unadjusted basis, Shopify showed a net loss of $72.8 million (64 cents a share), compared to a loss of $23.2 million (22 cents) in the year-earlier period.
Revenue, on the other hand, was up to $390.6 million, ahead of a pre-earnings estimate of $383.76 million. Gross merchandise volume (GMV) increased by 48 percent to $14.8 billion, while gross payments volume jumped to $6.2 billion and accounted for 42 percent of Shopify’s GMV processed in the period.
In remarks to analysts, Shopify COO Harley Finkelstein touted two major company milestones. Finkelstein said, “Last month, our counter hit the 1 million merchant mark. That means that 1 million businesses large and small have put their face in Shopify.” Finkelstein also noted on the earnings call that the company closed its 6 River Systems acquisition earlier in the month, which he said was the largest in the company’s history.
“This is another milestone, not just because it signals our commitment to solving some of the most critical challenges our merchants face, but because it is yet another way in which we are evolving to continue making commerce better for everyone,” Finkelstein said.
When it comes to payments innovation, Finkelstein noted that more buyers are opting into Shopify Pay with increasing quarterly order volume and GMV rising to over $1 billion in the third quarter. The company also enhanced its support as well as marketing tools in the third quarter and rolled out its first native chat function called Shopify Chat that lets merchants create stronger relationships with shoppers.
For the fourth quarter, the company expects revenue of $472 million to $482 million, higher than the FactSet estimate of $470.6 million. The company’s full-year outlook calls for $1.545 billion to $1.555 billion in revenue.