Shopify Stock Earnings Reports

Shopify reported a strong Q3 2025 with continued balanced growth and profitability. Key financials: GMV was $92B (up 32% YoY), revenue grew 32% YoY, and Q3 free cash flow margin was 18%; pro forma cash after subsequent convert settlement is about $6B with no debt. Merchant Solutions drove outperformance (Payments penetration reached 65% and Shop Pay processed ~$29B in the quarter), while Subscription Solutions grew more modestly (MRR +10% YoY, Plus plans now 35% of MRR). Gross margin compression was noted (overall 48.9%) driven by mix shift toward Merchant Solutions, higher hosting and AI costs, and partnership dynamics, but operating leverage improved (opex 37% of revenue, down from prior years). Product and strategic highlights: AI is central to Shopify’s strategy — Sidekick adoption accelerated (750k new shops in Q3, ~100M merchant conversations to date) and Shopify launched Commerce-for-Agents tooling (Catalog, Universal Cart, Checkout Kit) with partnerships including OpenAI/ChatGPT, Microsoft Copilot and Perplexity to enable agentic commerce. International momentum remains strong (international GMV +41% YoY; Europe a standout), payments and fulfillment integrations expanded (new carrier & fulfillment partners and DDP capabilities), B2B GMV nearly doubled (+98% YoY), and offline/retail-first GMV grew 31% YoY. Enterprise traction continued with marquee signings (Estée Lauder, e.l.f., Michael Kors, etc.), often landing via checkout/payments and expanding to full-stack adoption. Operational notes: increased payments and capital loss rates were a headwind this quarter but are already improving; management expects Q4 revenue growth in the mid-to-high 20s and gross profit dollars growth in the low-to-mid 20s, with Q4 opex guidance ~30–31% of revenue and FCF margin slightly above Q3. Tariff impacts remain limited based on Shopify’s internal data. Overall, Shopify emphasizes scale, merchant-first product execution, AI-driven product velocity, and consistent free cash flow generation while continuing to invest in growth opportunities globally.