In This Article:
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Revenue: Up 27% in Q1 2025.
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Free Cash Flow Margin: 15% in Q1 2025.
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Gross Merchandise Volume (GMV): $74.8 billion, up 23% in Q1 2025.
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Offline GMV Growth: Increased 23% in Q1 2025.
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B2B GMV Growth: Up 109% year-over-year in Q1 2025.
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International GMV Growth: Grew 31% in Q1 2025.
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Shopify Payments GMV Penetration: Reached 64% in Q1 2025.
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Shop Pay GMV: Up 57% year-over-year, processing over $22 billion in Q1 2025.
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Merchant Solutions Revenue: Increased 29% in Q1 2025.
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Subscription Solutions Revenue: Grew 21% in Q1 2025.
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Monthly Recurring Revenue (MRR): Up 21% year-over-year in Q1 2025.
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Gross Profit: Up 22% in Q1 2025.
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Operating Income: $203 million, or 9% of revenue in Q1 2025.
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Free Cash Flow: $363 million, or 15% of revenue in Q1 2025.
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Shopify Inc (NASDAQ:SHOP) reported a 27% increase in revenue for Q1 2025, with free cash flow margin reaching 15%.
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The company saw significant growth in key areas, including a 23% increase in offline GMV and a 109% rise in B2B GMV.
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International GMV grew by 31%, and cross-border trade remained steady at 15% of GMV.
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Shopify Payments expanded to 16 new markets, nearly doubling its reach to 39 countries, enhancing merchant onboarding and payment processing.
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The Shop App experienced 94% year-over-year growth in native GMV, with Shop Pay GMV up 57%, processing over $22 billion.
Negative Points
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Gross margin for merchant solutions decreased to 38.6% from 40.1% in Q1 2024, impacted by factors such as the PayPal partnership.
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The expiration of the de minimis exemption for goods from China could potentially impact Shopify's cross-border trade, though currently only 1% of GMV is affected.
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Subscription Solutions gross profit grew at a slower rate than revenue due to higher cloud and infrastructure costs.
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The shift to three-month paid trials in certain markets may create comparability issues for MRR throughout 2025.
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The dynamic macro and trade environment, including tariffs, presents ongoing uncertainties that Shopify Inc (NASDAQ:SHOP) must navigate.
Q & A Highlights
Q: Can you provide insights into where merchants are sourcing their inventory and how tariffs might impact them? A: Harley Finkelstein, President: Our merchant base is diverse, spanning various geographies and verticals, so exposure to tariffs varies. We haven't seen a significant impact on GMV yet. Many of our buyers in the US have incomes exceeding $100,000, which helps insulate against potential economic shifts. Jeff Hoffmeister, CFO: Our guidance incorporates potential impacts from tariffs and consumer spending, but we've seen continued strength in GMV through April and early May.