Shopify keeps up blazing growth with revenue up 57%

Dive Brief:

Shopify posted $1.1 billion in revenue for its second quarter, representing 57% growth from the same period last year, the company said in a release.
That figure includes $334.2 million in revenue from Shopify's subscription platform for merchants, up 70% from the year-ago period, and $785.2 million in the company's merchant solutions unit, up 52% mainly on growth in gross merchandise volume.
On Thursday, Shopify announced what it called "our largest set of platform investments to date." These include upgrades to Shopify's online store platform allowing for more personalization, new storefront hosting platforms and a faster checkout function.

Dive Insight:

The pandemic was a cardinal event in the relatively short history of e-commerce. Online sales grew at their fastest rate in nearly two decades, pulling forward years worth of growth into less than a year.

While growth is slowing with the reopening of the economy and return of shoppers to stores, much of the expansion last year could stick as many shoppers change their habits permanently.

Shopify provides infrastructure for online merchants that helped some of that growth along. Last year at this time, the company said that new e-commerce stores on its platform grew 71% in the span of a quarter while its revenue spiked 97% over the same period 2019.

That growth was from a harrowing, world-changing period, as traditional retailers weathered business restrictions and store closures and consumers faced a pandemic without the protection of available vaccines. While growth has slowed, Shopify's recent second quarter shows e-commerce growth remains robust, and not just on Amazon's website.

Shopify President Harley Finkelstein told analysts that the company did see an expected return of spending to recreation toward the end of Q2, but that worldwide GMV remained above pre-COVID levels, according to a Seeking Alpha transcript.

As it grows, Shopify continues building out its features and services, including its fulfillment network and mobile platform, which during the quarter added an analytics dashboard, automated marketing tools, and in-app cart and checkout, and discovery filters for LGBTQ+ and Indigenous-owned businesses.

Along with technology services, Shopify acts as a lender to many of its users as well, providing financing to their businesses. In Q2 Shopify Capital made $363 million in merchant cash advances and loans to merchants. Finkelstein told analysts that figure represented 137% year-over-year growth and a record for the company.