Shopify Inc. (SHOP) Reports Q3 2025 Earnings
Key Points
- Revenue: $2.84 B vs. $2.75 B est. — up 32% YoY
- EPS: $0.34 vs. $0.34 est. — flat YoY
- Gross Profit: $1.39 B (up 24%)
- Operating Income: $343 M (up 21%)
- Free Cash Flow: $507 M, 18% margin
- GMV: $92.0 B, up 32% YoY
- MRR: $193 M, up 10% YoY
Quarter Highlights
- Achieved nine consecutive quarters of double-digit free-cash-flow margins.
- Merchant solutions revenue surged 38%, while subscription solutions rose 15%.
- Operating expenses grew to $1.05 B, mainly from higher R&D and transaction losses.
- Net income was $264 M, but excluding equity investment impacts, $367 M, up from $344 M last year.
- Cash and equivalents increased to $2.41 B from $1.50 B at year-end 2024.
CEO Statement and Outlook
President Harley Finkelstein said Shopify’s growth engine is running at “full speed,” citing broad adoption from new entrepreneurs to global brands.
CFO Jeff Hoffmeister called Q3 a “standout quarter,” highlighting consistent growth and profitability.
Q4 2025 guidance:
- Revenue growth mid-to-high 20s % YoY
- Gross profit growth low-to-mid 20s % YoY
- Operating expense ratio 30–31% of revenue
- Stock-based comp ≈ $130 M
- Free cash flow margin slightly above Q3
Financial Summary
| Metric | Q3 2025 | Q3 2024 | YoY Change |
|---|---|---|---|
| Revenue | $2.84 B | $2.16 B | +32% |
| Gross Profit | $1.39 B | $1.12 B | +24% |
| Operating Income | $343 M | $283 M | +21% |
| Net Income (ex-investments) | $367 M | $344 M | +7% |
| Free Cash Flow | $507 M | $421 M | +20% |
| Free Cash Flow Margin | 18% | 19% | −1 pt |
| GMV | $92.0 B | $69.7 B | +32% |
Capital Return
No dividend or buyback activity disclosed. Cash position improved sharply with $872 M increase in cash during the quarter.
Key Takeaways
- Shopify delivered broad-based growth across both merchant and subscription lines.
- Free cash flow discipline remains a defining strength, marking another high-margin quarter.
- Slight dip in FCF margin reflects higher transaction and loan losses.
- Q4 guidance implies continued double-digit expansion, reinforcing Shopify’s profitability momentum.
Stock Reaction: SHOP closed at $160.94 (−6.94%) following results.