Shopify (NYSE: SHOP) stock plunged about 20% in intraday trading after the company provided lower-than-expected guidance for the current quarter.
E-commerce giant Shopify (SHOP) issued guidance below forecasts, signaling a slowdown in sales growth and continued effects from the sale of its logistics business last year.
The renowned retail platform expects revenue growth in the high teens percentage year-over-year for the current quarter. This projection falls below the consensus estimates compiled by Visible Alpha and marks a continuation of the recent slowdown in quarterly sales growth.
This outlook follows Shopify’s first-quarter earnings report, which revealed a net loss of $273 million, primarily attributed to the effects of the logistics business sale.
This news overshadowed an otherwise robust Q1 earnings report. Excluding some charges, the company reported an adjusted profit of $0.20 per share. Revenue climbed 23% to reach $1.86 billion. Both metrics beat analysts’ estimates.
Moreover, Gross merchandise volume from merchant transactions surged by 23% to reach $60.9 billion, surpassing expectations. Merchant solutions revenue climbed by 20% to $1.4 billion, while subscription solutions revenue soared by 34% to $511 million, both outperforming analyst estimates.
Shopify (NYSE: SHOP) Stock Reaction
SHOP stock plummeted 18.59% to close at $62.73 on Wednesday. Its value increased by 10.89% this week. Trading activity has witnessed 58,128,597 (58.12 million) shares changing hands, well above the average daily volume of 9.04 million.
