The Shopify logo is pictured outside The Well building on Spadina Ave. in Toronto.
Lance McMillan | toronto star | Getty Images
Shares from Shopify Canadian e-commerce company Amazon.com Inc. shares closed up 17.8% on Wednesday after the company beat expectations for the second quarter, citing strong demand despite a “mixed consumer spending environment.”
Here's how the company performed compared to what Wall Street was expecting, based on a survey of analysts conducted by LSEG:
Earnings per share: 26 cents vs. 20 cents expectedRevenue: $2.05 billion vs. $2.01 billion expected
The company said gross merchandise volume, or the total amount of goods sold on the platform, jumped 22% during the quarter to $67.2 billion. That easily topped the consensus estimate of $65.8 billion, according to FactSet.
Shopify sells software to merchants who run online businesses as well as services such as advertising tools and payment processing. Shopify CFO Jeff Hofmeister said in a statement that the company continued to “gain share” during the quarter even as consumer spending remained in flux amid a tough economic backdrop.
Competing e-commerce companies including: Amazon, Etsy And Wayfair Consumers remain cautious about their spending and in some cases are “turning to cheaper brands” as they hunt for deals, analysts have all said in earnings reports in recent weeks.
In a conference call with investors, Shopify executives said its merchants were able to weather the slowdown in consumption, a factor they attributed to the “very diverse group” of businesses using its platform.
“I think our merchants seem to be outperforming and outperforming others,” Shopify CEO Harley Finkelstein said on the call. “And I think a big part of the reason we’re not seeing the same thing that others might be seeing is simply that we have merchants across a wide range of verticals and across a wide range of (geographies).”
For the third quarter, Shopify said it expects revenue to grow at a low- to mid-20s rate year-over-year. Analysts surveyed by FactSet expect sales to grow 21% year-over-year to $2.07 billion.
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