Technology
Tuesday, February 13th, 2024 4:15 pm EDT
Key Points
- Shopify’s stock experienced a 10% decline after reporting better-than-expected earnings for the fourth quarter but providing mixed guidance for the current period.
- Fourth-quarter performance exceeded analyst expectations, with adjusted earnings per share of 34 cents versus the expected 31 cents and revenue of $2.14 billion compared to the anticipated $2.08 billion.
- Despite strong results, Shopify’s first-quarter guidance fell short of investor expectations, with projected free cash flow margin in the high single digits, below the anticipated 13.6%. Analysts noted that the company’s guidance implies significantly lower operating income compared to consensus estimates. Shopify anticipates first-quarter revenue growth in the low twenties percentage rate.
On Tuesday morning, Shopify’s stock experienced a 10% decline following the release of its fourth-quarter earnings report, which surpassed analyst expectations but offered a mixed outlook for the current period. The company reported adjusted earnings per share of 34 cents, beating the expected 31 cents, and revenue of $2.14 billion, slightly higher than the anticipated $2.08 billion. Jeff Hoffmeister, Shopify’s CFO, attributed the robust performance to increased sales of products on its platform, with gross merchandise volume reaching $75.1 billion, a 23% increase compared to analyst estimates of $72.1 billion. However, Shopify’s first-quarter guidance fell short of investor expectations, with projected free cash flow margin in the high single digits, lower than the anticipated 13.6%. Wedbush analysts noted that Shopify’s guidance indicates operating income significantly below consensus estimates, with a forecasted adjusted operating income of $178 million compared to a consensus of $382 million. Shopify anticipates first-quarter revenue growth in the low twenties percentage rate, translating to a mid- to high-20s year-over-year growth rate when adjusting for the sale of its logistics business. The company reported a net income of $657 million, or 51 cents per share, compared to a loss of $623 million, or a loss of 49 cents per share, in the same quarter the previous year.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/02/13/shopify-shop-earnings-q4-2023.html
