Shopify forecasts slowing revenue growth, shares fall

An worker works at Shopify’s headquarters in Ottawa, Ontario, Canada, October 22, 2018. REUTERS/Chris Wattie/File Photograph

Feb 16 (Reuters) – Canada’s Shopify Inc (SHOP.TO) on Wednesday forecast a slowing tempo in first-half income progress, indicating the e-commerce growth seen through the pandemic is cooling as retailers shift their focus again to brick-and-mortar shops from on-line.

U.S.-listed shares of the corporate have been down about 6% in buying and selling earlier than the bell.

Ottawa-based Shopify – which helps retailers arrange on-line shops via subscription-based software program instruments, whereas providing companies resembling delivery to funds – benefited through the pandemic as companies rapidly moved on-line to trip a growth in e-commerce.

“We consider that the COVID-triggered acceleration of ecommerce that spilled into the primary half of 2021 within the type of lockdowns and authorities stimulus might be absent from 2022, and there may be warning round inflation and shopper spend close to time period,” the corporate mentioned in a press release.

It expects income progress for 2022 to be decrease than the 57% rise recorded in 2021.

For the fourth quarter ended Dec. 31, income was $1.38 billion, in contrast with $977.7 million a 12 months earlier. Analysts have been anticipating $1.33 billion, in keeping with Refinitiv knowledge.

Gross merchandise quantity, which is the full quantity of gross sales the corporate raked in, was $54.1 billion, a rise of 31%.

On an adjusted foundation, it earned $1.36 per share in contrast with analysts estimate of $1.27.

Shopify has misplaced its title of being Canada’s most beneficial firm after its shares shed greater than a 3rd of their worth this 12 months.

Reporting by Nivedita Balu in Bengaluru; Enhancing by Anil D’Silva

: The Thomson Reuters Trust Principles.