Why Shopify (SHOP) Shares Are Plunging Today - Shopify (NASDAQ:SHOP)

Shopify Inc SHOP reported second-quarter FY22 sales growth of 16% year-on-year, to $1.29 billion, missing the consensus of $1.71 billion.
Revenue from Subscription Solutions rose 10% Y/Y to $366.4 million, primarily due to more merchants joining the platform and Merchant Solutions increased 18% Y/Y to $928.6 million, driven primarily by the growth of Gross Merchandise Volume (GMV).
GMV rose 11% Y/Y to $46.9 billion. Monthly Recurring Revenue (MRR) rose 13% Y/Y to $107.2 million.
Margin: The non-GAAP gross margin contracted 500 bps to 51%, reflecting a greater mix of lower-margin Merchant Solutions revenue, lower margins in Shopify Payments due to mix, and increased investments in its cloud infrastructure.
The adjusted operating margin loss was (3)%. The shrinkage reflected the expansion of its R&D and sales and marketing teams.
Adjusted EPS loss of $(0.03) missed the consensus of $0.03.
Shopify held $6.95 billion in cash and equivalents.
Shopify looks to downsize by 1,000 workers, or 10% of its global workforce, marking a retreat from its pandemic bet on e-commerce growth.
Price action: SHOP shares traded lower by 7.07% at $29.32 in the premarket on the last check Wednesday.
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Momentum88.98

Growth97.04

Quality73.56

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Shopify Shares Drop After Q2 Earnings Miss Consensus, Margin Contracts