Shopify has released its financial results for the first quarter of 2017. The company reported significant business milestones for the year, as well as optimism for continued growth in the coming months.
As of March 31, 2017, Shopify’s total revenue was $127.4 million, a 75 percent increase from the first quarter of 2016. With an increase in merchants using the company’s ecommerce platform, subscription solutions revenue grew 60 percent to $62.1 million, while merchant solutions revenue grew 92 percent to $65.3 million.
For Q2 2017, Shopify expects revenues in the range of $142 to $144 million. For the full year, Shopify expects revenues within $615 million to $630 million.
Shopify’s monthly recurring revenue was $20.7 million, up 62 percent compared to $12.8 million during the same time last year. Gross profit grew 80 percent to $72.2 million for the first quarter of 2017, versus $40.1 million for the first quarter of 2016. The company also reported an increase in operating loss for the first quarter of 2017 at $14.5 million, compared to $9.7 million in the first quarter of 2016. Shopify reported a net loss of $13.6 million ($0.15 per share) compared with $8.9 million ($0.11 per share) for the first quarter of 2016.
Russ Jones, Shopify’s CFO, indicated that with a strong start to the year, Shopify is becoming the go-to platform for sellers. “In addition to merchant growth and their adoption of both new channels and merchant solutions, we also continue to see expansion of merchants’ GMV,” said Jones. “Retail is shifting headlong toward the vision we laid out two years ago – of inspiring entrepreneurship with multi-channel commerce – and we fully expect to continue leading this industry transition for years to come.”
Company highlights in Shopify’s Q1 report included announcements of new products at the Shopify Unite conference held in San Francisco last month. At Shopify Unite, Shopify announced a new chip and swipe card reader that offers portability and EMV support to Shopify merchants, and Shopify Pay, which lets customers save their shipping and credit card information to reduce the time it takes to purchase with Shopify Merchants.
“Shopify continues to build momentum. They have been public for seven quarters, and beaten analyst’s expectations every single quarter,” said Mark MacLeod, former Shopify CFO and SurePath Capital Partners founder. “With the latest announcements coming out of their Shopify Unite conference, it’s clear to me that they are still just getting started.”
Other company highlights included a Wholesale Channel for Plus, through which Shopify Plus merchants can create a separate, password-protected storefront and invite buyers to purchase products at assigned wholesale prices, as well as new application programming interfaces (APIs) for partners. The company reported that mobile traffic to merchants’ stores continued to grow, reaching 69 percent of traffic and 59 percent of orders at the end of March 2017.
For the second quarter of 2017, Shopify expects revenues in the range of $142 to $144 million. For the full year 2017, Shopify expects revenues in the range of $615 million to $630 million and adjusted operating loss in the range of $14 million to $18 million, which excludes stock-based compensation expenses and related payroll taxes of $55 million.