Shopify Stock Hits Two-Year Low, President Urges “Patience”
Canadian e-commerce company Shopify’s stock slipped another 8.6 per cent on Friday to reach a two-year low.
The shares have now plummeted 22 per cent since releasing its disappointing first-quarter financials on Thursday morning.
Shopify posted adjusted earnings of 20 cents per share (USD), while Wall Street had forecast earnings of 63 cents per share.
President Harley Finkelstein has urged investors to focus on long-term growth, pointing out the company’s growing roster of merchants, and the unseasonal boom that came with the pandemic. Harvey Norman Bing Lee, JB Hi Fi and several other leading Australian retailers use Shopify for e-commerce sales.
“We’re in an inflationary environment and consumer spending has changed dramatically,” Finkelstein told Bloomberg.
“We’re looking at very difficult comps here. I think anyone that’s studied the stock and the market sees that. When you compare Q1 of 2022 to Q1 of 2021, we had lockdowns, we had government stimulus and it was a very different economy.”
Shopify recently made the $2.1 billion acquisition of delivery technology company Deliverr to expand its fulfillment network – something Finkelstein says will bring in additional revenue.
Finkelstein also stressed Shopify expects “rapid” sales growth, and that businesses who leans on the company’s e-commerce platform in the lockdown are now installing its point-of-sales technology for bricks and mortar retail.
Wall Street analysts expect likewise, tipping growth of 28 per cent in 2022, to reach almost US$6 billion.