Shopify releases Q1 2016 results, announces 95 percent increase in revenue YoY

Shopify TSX

Shopify’s first quarter 2016 results are in. The company has continually demonstrated that it can hold its own as a public company since its IPO last year, and is maintaining its growth since it last reported Q4 2015 results, when it reported 99 percent YoY growth.

As of March 31, 2016, Shopify’s total revenue was $72.7 million, a 95 percent increase from the first quarter of 2015. Thanks to an increase in merchants using the company’s platform, subscription solutions revenue grew 73 percent to $38.7 million, while merchant solutions revenue grew 127 percent to $34.0 million, primarily driven by an increase in revenue from Shopify Payments.

Monthly recurring revenue was $12.8 million, up 73 percent compared with $7.4 million during the same time last year. Gross profit grew 82 percent to $39.3 million for the first quarter of 2016, versus $21.6 million for the first quarter of 2015. The company also reported an increase in operating loss for the first quarter of 2016 at $9.7 million, compared to $3.5 million for the first quarter of 2015.

Company highlights include mobile orders surpassing desktop for the first time ever; just over 51 percent of orders exiting the quarter came from mobile devices while the share of traffic from mobile devices in the quarter was even higher at 62 percent.

Mark MacLeod, founder of SurePath Capital and former Shopify CFO, indicated that Shopify is set to become a leader in the mobile space. “Shopify is continuing its strong momentum as a public company and clear market leader. Revenues are up 95 percent year on year. More fundamentally, the pace of innovation is staggering. This is a big reason why mobile orders have now surpassed desktop,” said MacLeod. “This is an inevitable trend, but Shopify is leading the pack. I typically see 30 percent mobile with other e-commerce companies.”

As Shopify announced the acquisition of Kit, a bot that manages social marketing for small businesses via SMS, it’s clear that the company sees its future in mobile.

“The era of mobile commerce has officially arrived: mobile orders from Shopify merchants surpassed those of desktops in February, and have continued to climb since,” said Tobi Lütke, founder and CEO of Shopify. “Mobile is bringing commerce to places it’s never been before, it is making it more social, and we are pushing that forward in a big way. With our recent integration with Facebook’s new Messenger platform and our acquisition of a leader in mobile messaging for commerce, Kit CRM, we’re making it easier for our merchants to thrive in this new era.”

For the full year 2016, Shopify expects revenue in the range of $337 million to $347 million, and GAAP operating loss in the range of $41 million to $47 million.

Read the full report here.