What Can Investors Expect From Shopify’s Q1 Earnings Call?

With earnings on the horizon, many investors are expecting a bloodbath from Shopify, but that shouldn’t dissuade long-term investors.

Down almost 70% year-to-date, it’s likely that a big (and wild) couple of weeks are ahead for Shopify investors when it reports its Q1 earnings on Thursday.

So, what exactly can we expect?

A rough first quarter for Shopify

Like so many other high-growth companies in the market right now, Spotify has been getting spanked, and its once unassailable highs have become crushing lows. 

This has culminated in some pretty conservative guidance for Q1 and what to expect. According to experts, this cloud-based commerce company that still seeks Amazon’s now-Bezosless crown is expected to post quarterly earnings of $0.76 per share in its upcoming report, which represents a year-over-year decline of 62.2%. On a lighter note though, revenues are expected to be $1.25 billion, up 26% from the year-ago quarter.

As always, supply chain issues, inflation, etc., are the main culprits behind these low estimates. 

But, if we’ve learned anything as long-term, buy-and-hold investors, is that great businesses don’t have crushing lows at all really, just discount opportunities. 

And Shopify is as strong as ever. 

Shopify just ended a year in which it saw gross merchandise volume — or everything sold on the platform — grow 47% while revenue grew even faster, at 57%. This proves that sellers are moving a lot of merchandise, and Shopify’s tools are their go-to. The real moat builder is also emerging in the form of the Shopify Fulfillment Network, which offers an option to make shipping much easier and more streamlined for merchants.

In 2021, Shopify’s merchants already represented over 10% of U.S. retail e-commerce sales, but this could be only the beginning of its dominance in the space, and we’re on this ride ’til the very end.