Shopify's growth is not enough to appease investors

The Canadian e-commerce store Shopify's turnover grew by more than 60% in the second quarter, but it was not enough to strengthen the company's shares against a global technology haircut and fears of a slowdown in growth.

For the quarter, Shopify recorded an operating loss of $ 30.8 million on a US $ 245 million business

To a certain extent, the loss of The operation was predictable and the management had already warned however, other measures that investors are closely watching also gave rise to a pause in the market.

Income for the Ottawa Company – which provides payment, shipping, marketing and other services to online merchants, as well as services to traditional retailers increased by 62%. year to year, but this represents a slowdown from the 75% growth in the second quarter of last year.

Similarly, the volume of merchants, the measure of all merchandise sold through Shopify, reached 9.1 billion US dollars, an increase of 56% over the same period. period last year. But this growth rate has also been considerably slower than that of Q2 in 2017, when the company grew 74% year-over-year.

Shopify's financial reports come as technology stocks beat the markets. Facebook saw its shares fall by more than $ 120 billion, after the social network announced a stagnation of user growth.

Shopify's shares have fallen since Facebook's disappointing report, and finished down 5.54 During the second quarter earnings cycle, tech giants Netflix and Twitter also missed, though not as seriously as Facebook

"If you look at the fallout after the disappointing results of Facebook, I think that," said Suthan Sukumar, an badyst at Eight Capital, who covers Shopify.

"Shopify is one the most expensive technology stocks on the market today Washington is always more sensitive, more volatile compared to its peers. "

Shopify's CEO, Tobi Lutke, spoke about Facebook's situation at the time. Tuesday morning call, when asked if the problems with social networks The giant will affect Shopify, because many online retailers rely heavily on Facebook's targeted ads to boost sales.

Lutke says that Facebook's struggle to develop boils down to "running out of humans on the planet," he does not think it will create problems for Shopify, as merchants will find new avenues for their advertising .

"Until now, the internet has been very good at creating new advertising space," he said. 19659002] "I think you'll just see people getting a little more enterprising."
Behind the numbers, several badysts have seen the potential to accelerate Shopify's growth again.

Focusing on their expansion efforts beyond North America, and the Shopify Plus program, which addresses larger and larger retail businesses established.

Larger merchants who join the Shopify Plus program are perceived as more "sticky". As they are larger companies, they tend to move more stocks and generate more revenue.

"It is clear that they have other growth avenues they are working on, so we think these could" Richard Tse, Analyst at National Bank Financial

"They have a number of ongoing initiatives that could be very useful in propelling this company to another level.

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