E-commerce firm Shopify on Wednesday reported a loss for the June quarter while revenue and gross merchandise volume missed estimates. SHOP stock reversed up after the company’s earnings call with Wall Street analysts.
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Canada-based Shopify (SHOP) reported second-quarter earnings before the market open. SHOP stock initially fell on the earnings release.
But Shopify stock climbed 7% in morning trading following its earnings call on the stock market today. Shares in the e-commerce firm plunged on Tuesday after disclosed plans to cut 10% of its workforce.
For the quarter ending June 30, Shopify said it lost 3 cents per share on an adjusted basis.
Revenue for SHOP stock rose 16% to $1.295 billion, the company said. Revenue growth decelerated for a fifth-straight quarter as the coronavirus pandemic fades and online shopping normalizes.
Shopify Stock: Gross Merchandise Volume Light
Analysts expected Shopify earnings of 3 cents a share on revenue of $1.33 billion. A year earlier, Shopify earned 22 cents per share on revenue of $1.12 million.
Gross merchandise volume from merchant customers came in at $46.9 billion vs. estimates of $48.84 billion.
“Q2 results showed trends are deteriorating even more swiftly than expected,” Jefferies analyst Samad Samana said in a note to clients. “GMV of $46.9 billion missed estimates, leading to a total revenue miss. Profitability missed due to the revenue shortfall and elevated expenses.”
SHOP stock tumbled 14% on Tuesday. Shopify stock has declined nearly 80% in 2022.
Merchant Solutions Sales Up 18%
In the June quarter, Shopify said merchant solutions revenue rose 18% to $929 million. Subscription solutions revenue climbed 10% to $366.4 million. Analysts had projected merchant solutions revenue of $968.2 million and subscription solutions revenue of $361.6 million.
Shopify sets up e-commerce websites for small businesses, and partners with others to handle digital payments and shipping.
The e-commerce firm on Tuesday said it will cut roughly 1,000 workers, or 10% of its workforce.
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