Shopify Inc. saw its shares advance more than 7% in premarket trading Wednesday after the e-commerce platform delivered fourth-quarter revenue that surpassed analyst forecasts and authorized a substantial $2 billion share repurchase program.
The company reported quarterly revenue of $3.67 billion, marking a 31% increase year-over-year and exceeding the consensus estimate of approximately $3.60 billion. Gross merchandise volume processed on its platform reached $123.8 billion for the period.
For the current quarter, Shopify projected revenue growth in the low-thirties percentage range, which stands above Wall Street's expectation of roughly 25% growth. This optimistic outlook arrives despite broader economic concerns surrounding inflation and consumer spending.
Net income for the quarter was $743 million, down from $1.29 billion in the prior-year period. The company also reported free cash flow of $715 million, with a margin of 19%, compared to 22% a year earlier.
Looking ahead, management anticipates the free cash flow margin will be in the low-to-mid teens for the first quarter, a step down from the year-ago quarter. The newly authorized share repurchase program, set to commence on February 17, has no fixed expiration date.
President Harley Finkelstein characterized 2025 as a year of strong execution and framed 2026 as focused on merchant tools, highlighting investments in areas like AI-driven shopping features. The company continues to compete in a crowded space against other website builders and larger bundled commerce ecosystems.
