Making Financial Headlines · Page 9
Shopify Beats on Adjusted Earnings and Still Gets Sent to the Revenue Office
· New York time
Shopify shares fell more than 8% after third-quarter revenue and gross merchandise volume missed estimates, despite adjusted earnings beating expectations. Gross merchandise volume is the value of goods sold through merchants using the e-commerce platform, so it offers a view of activity across those businesses. The missed estimates concern performance relative to forecasts, not necessarily a decline in the underlying figures. Investors had both a favorable earnings comparison and disappointing revenue and merchandise-volume comparisons to weigh. The share-price reaction shows which side of that report got the louder reception. Shopify arrived with one number that exceeded expectations and two that did not, only to discover that Wall Street does not grade by averaging the applause. A profit beat can earn a compliment, but it cannot automatically erase a sales miss from the report card.
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