Shopify Inc (NYSE:SHOP) reported third-quarter revenue growth of 25% year-over-year to $1.71 billion, which beat the consensus estimate of $1.67 billion.
The e-commerce platform company reported adjusted EPS of $0.24, which beat analyst estimates of $0.14.
Gross merchandise volume increased 22% year-over-year to $56.2 billion. Gross payments volume came in at $32.8 billion. Merchant solutions revenue increased 24% year-over-year to $1.2 billion.
Free cash flow totaled $276 million in the second quarter compared to negative free cash flow of $148 million in the same quarter last year.
Shopify expects FY23 revenue growth of a mid-twenties percentage rate on a Y/Y basis (prior expectation of low-twenties percentage rate) versus $6.95 billion consensus, driven by Q4 revenue growth in the high-teens Y/Y compared to a consensus of $2.08 billion.
The company expects the Q4 gross margin to be higher by 300 – 400 bps than the Q4 FY22 margin of 46.0%, primarily due to the absence of the logistics business.
It projects a free cash flow margin in the high teens and expects capital expenditures of approximately $45 million for FY23.
The stock has gained 37% YTD.
SHOP Price Action: Shopify shares traded higher by 17.40% at $57.27 premarket on the last check Thursday.
