Shopify 1Q Loss Widens, Revenue Tops Estimations

Shopify Inc

reported a wider net loss of $8.708 million or a loss of $0.11 a share for the first quarter. In comparison, the company suffered a narrow loss of $4.53 million or a loss of $0.12 a share in the year-ago quarter. However, its adjusted net loss was $5.1 million, or a loss of $0.06 per share, compared with an adjusted net loss of $2.5 million, or a loss of $0.06 per share, in the comparable quarter of the preceding year. Street analysts expected a loss of $0.09 a share. The company's total revenues jumped to $72.72 million from $37.35 million in the previous year quarter and came in well above the analysts' estimations of $66.89 million. While subscription solutions revenue climbed to $37.71 million from $22.35 million, merchant solutions revenue more than doubled to $34.02 million from $15 million in the same quarter last year. Shopify founder and CEO, Tobi Lutke, commented that "The era of mobile commerce has officially arrived: mobile orders from Shopify merchants surpassed those of desktops in February, and have continued to climb since. Mobile is bringing commerce to places it's never been before, it is making it more social, and we are pushing that forward in a big way. With our recent integration with Facebook's new Messenger platform and our acquisition of a leader in mobile messaging for commerce, Kit CRM, we're making it easier for our merchants to thrive in this new era." The company's CFO, Russ Jones, added that "Our first quarter delivered a great start to the year. The strong merchant adds in the quarter, together with GMV once again doubling year on year, highlight the value we bring to merchants of all sizes. Our unique combination of strengths is clearly meeting a pressing need in commerce right now." Moving ahead, Shopify said that it expects its revenues between $337 million and $347 million for the full year 2016. The company indicated that it sees adjusted operating loss of $16 to $22 million for the same period. Street estimate the company to deliver $327.8 million. For the second quarter, the company projects revenue of $79 - $81 million and adjusted operating loss of between $6 and $7 million. Analysts expect $74.74 million. Shares of the company traded 2.13% down on Tuesday.