SHOP TSX NASDAQ-100 Earnings call
Shopify (SHOP) · Q2 2026 results and valuation
Share price: 212.57 CAD · 2026-11-11
Shopify operates a cloud e-commerce management platform for retail point-of-sale systems. The company provides its services to a variety of retail customers across international markets. Source: Wikipedia
Results Q2 2026 vs Q1 2026 · previous quarter · published 5 Aug 2026 and 5 May 2026
Net income turned to a profit from a loss last quarter. Management sounded cautious, though noticeably more positive answering analysts.
1 · Numbers
Turned profit
Net income vs Q1 2026
Outlook given
Net income 1.50B vs -581.0M
Revenue +13.0%
Why Against the same quarter last year (+65.8%), net income rose primarily because gross profit dollars grew faster than expenses due to disciplined management of headcount, sales and marketing, R&D, and G&A as a percentage of revenue.
2 · How management spoke
Cautious
Among the least upbeat of all company calls
Answers to analysts: upbeat, and more positive than the script.
Similar to last call.
3 · What stood out
Shopify expects Q3 free cash flow margin to be in the high teens to low 20s, including less than 1 point of tailwind from a merchant cash advances accounting change.
Valuation
Is Shopify undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 20.0% growth a year (3-year revenue growth), the model's fair value is $79.57 a share — the stock trades 88% above it. Today's price assumes 29.1% growth a year.
Current price
$149.26
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+29.1% for 10 yrs
Fair value / share
$79.57
Buy below
$59.68
Price vs fair value
Overvalued 88%
Price vs buy-below price
Overvalued 150%
Read between the lines
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Guidance
Shopify expects Q3 revenue growth in the low 30s year-over-year.
Source quote
“We achieved greater than 30% growth in each of GMV, revenue, gross profit, operating income, and free cash flow.”
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Guidance
Shop expects Q3 free cash flow margin to be in the high teens to low 20s, which includes less than 1 point of tailwind from a merchant cash advances accounting change.
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Figure
GMV increased 32% to $116 billion due to broad growth across merchant sizes, geographies, and sales channels.
Source quote
“GMV was up 32% to $116 billion with broad growth across our merchant sizes, geographies and sales channels.”
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Figure
Operating expenses were 34% of revenue, reflecting a nearly 4-point improvement from Q2 last year.
Source quote
“Now looking at operating expenses, which were 34% of revenue, a nearly 4-point improvement from Q2 last year.”
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Guidance
Sidekick onboarding guidance drove an 8% increase in new merchants reaching 5 orders within 15 days, improving the initial experience for new stores.
3 more
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Figure
Daily active merchants using Sidekick increased 3.6x year-on-year and daily sessions grew 4.8x in the second quarter.
Source quote
“In the second quarter, daily active merchants using Sidekick were up 3.6x year-on-year and daily sessions were up 4.8x.”
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Figure
Half of all AI-referred sessions land directly on a product description page, which is 2.5x more than traditional search, compressing buyer shopping journeys.
Source quote
“Buyer shopping journeys are being compressed as half of all AI-referred sessions are landing directly on a product description page. That is 2.5x more than what we see with traditional search.”
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Figure
Shop app's native GMV grew over 70% in Q2, with the Cart Sync feature accounting for over 30% of that GMV.
Source quote
“Shop app's native GMV grew over 70% in Q2. And one of my favorite features Cart Sync, represented over 30% of Shop app GMV in this quarter.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Management was more positive answering analysts than in its script — usually a sign it was comfortable with the details it was asked about.
Sentences that drove the tone
“Merchant Solutions revenue grew 37%, driven primarily by the strength in GMV and increased payments penetration, which grew 3 points year-over-year, reaching 68% of our global GMV.”
“And as we enter this agentic era, any acceleration in e-commerce growth or disproportionate value to the long tail of commerce is upside to our underlying growth story.”
“Subscription Solutions revenue grew 22%, the largest contributor to the growth was monthly subscriptions for our standard plans, as we saw a strong quarter of merchant net adds in Standard.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-06-30)
| Metric | Q2 2026period end 2026-06-30 | Q1 2026period end 2026-03-31 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 3.58B | 3.17B | +13.0% | 2.68B | +33.7% |
| Gross profit | 1.71B | 1.55B | +10.5% | 1.30B | +31.2% |
| Operating income | 488.0M | 382.0M | +27.7% | 291.0M | +67.7% |
| Net income | 1.50B | -581.0M | Turned profit | 906.0M | +65.8% |
| EPS | 1.16 | -0.45 | Turned profit | 0.69 | +68.1% |
| P/E today 91.4 | 77.1 | 116.3 | −39.2 | 64.1 | +13.0 |
Topics
Most discussed now
- Every new surface area they build is another place Shopify's merchants can sell, all because they're on Shopify.
- Shopify's Q1 2015 cohort now has a quarterly GMV that's 5x its initial size, implying a compound annual...
- Shopify thinks you've seen this, of course, but the agentic transactions carry the exact economics as an online store transaction.
- You're going to see this accelerated checkout experience that is going to be far better than whatever you have.
- More merchants are using Sidekick and each merchant is finding new ways to use it.
Faded since Q1 2026
- Fading New buyer orders from AI searches are actually occurring at nearly twice the rate of traditional organic search.
- Fading Each new cohort stacks on top of the prior one and Shopify's newer cohorts are larger than the ones before...
- Fading Shopify gives you everything you need by operating across the entire commerce stack.
- Fading If you talk to partners and particular app developers that are building for commerce or retail, for the most part,...
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations · SEC 8-K
- Results of operations · SEC 8-K
Shopify Inc. issued a press release on August 5, 2026, regarding its financial results for the quarter ended June 30, 2026.
- Director or officer change · SEC 8-K
Prashanth Mahendra-Rajah resigned from the Shopify Inc. board and as Chair of the Audit Committee on July 2, 2026, to accept a position with the U.S. Department of Commerce.
- Shareholder vote results; Other events · SEC 8-K
At the June 16, 2026 annual meeting, shareholders elected 10 directors, including Tobias Lütke with 97.72% of votes, and approved the appointment of PricewaterhouseCoopers LLP as auditors.
- Regulation FD disclosure · SEC 8-K
Shopify Inc. authorized an additional $3.0 billion to repurchase Class A subordinate voting shares, increasing the total repurchase authorization to $5.0 billion.
- Other events · SEC 8-K
Shopify Inc. announced its 2026 Annual General Meeting will be held online on June 16, 2026, to review financial statements and elect 10 directors.
- Results of operations · SEC 8-K
Shopify Inc. issued a press release on May 5, 2026, regarding its financial results for the quarter ended March 31, 2026.
- Results of operations; Regulation FD disclosure · SEC 8-K
Shopify Inc. announced its financial results for the fiscal year ended December 31, 2025, and authorized a share repurchase program of up to US$2.0 billion starting February 17, 2026.
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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Q3
revenue growth in the low 30s year-over-year
Source quote
“We expect Q3 revenue growth in the low 30s year-over-year.”
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Q3
gross profit dollars to grow in the mid- to high 20s
Source quote
“We expect our gross profit dollars to grow in the mid- to high 20s.”
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Q3
operating expenses to be 33% to 34% of revenue
Source quote
“We expect operating expenses in Q3 to be 33% to 34% of revenue, reflecting continued leverage and meaningful improvement compared to the 37% we delivered in Q3 of last year.”
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Q3
free cash flow margin to be in the high teens to low 20s
Source quote
“We expect our Q3 free cash flow margin to be in the high teens to low 20s, inclusive of less than 1 point of tailwind from the accounting change in merchant cash advances.”