"The standout driver was Merchant Solutions, which surged 38% year-over-year to $2.145B. This segment now represents 75% of total revenue and reflects both pricing increases and expanded adoption across the platform. Subscription Solutions grew at a slower but still solid 15% pace to $699M, showing the diversification of the business model beyond transaction-dependent revenue. Revenue totaled $2.84B, beating the $2.81B consensus estimate by 1.2%. Gross profit climbed 24% to $1.39B, while operating income rose 21% to $343M."
"Operating cash flow came in at $513M against minimal capital expenditure of just $6M, underscoring the asset-light nature of the platform. The company maintains a fortress balance sheet with $2.414B in cash and equivalents against total liabilities of $2.213B. Shareholders' equity sits at $12.511B, reflecting years of profitable operations and disciplined capital allocation. What stands out here is the consistency. Free cash flow margins stayed elevated at 18%, and management guided for Q4 free cash flow margins to remain slightly above Q3 levels."
Shopify reported 32% year-over-year revenue growth in Q3, reaching $2.84B and topping estimates. Merchant Solutions surged 38% to $2.145B and now comprises 75% of revenue, while Subscription Solutions rose 15% to $699M. Gross profit increased 24% to $1.39B, operating income rose 21% to $343M, and net income was $264M. Free cash flow totaled $507M with an 18% margin, and operating cash flow was $513M versus minimal $6M capex. Cash and equivalents stood at $2.414B against $2.213B in liabilities. Q4 guidance targets mid-to-high twenties revenue growth and slightly above Q3 free cash flow margins.
Read at 24/7 Wall St.
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