Something disappointed given pre market activity;
This is a public question
SHOP reported revenue beating estimates of $1.84B coming in at $1.86B, displaying 23% year-over-year growth. Adjusted EPS also beat estimates of 17c coming in at 20c increasing 1c from the year prior. Gross merchandise volume was $60.86B beating estimates and displaying 23% year-over-year growth. Merchant solutions and subscription revenue both displayed strong growth of 24% and 34% from the prior year and beat estimates. Markets had an issue with SHOP's outlook, particularly gross profit margin outlook for Q2, which the company sees declining 50 bps. SHOP also said it expected revenue growth in the 'high-teens,' which was disappointing to some when estimates called for growth just under 20% for Q2. Additionally, the company raised its operating expenditure guidance. The earnings for Q1 in itself were strong and continued to display high growth. However, markets were concerned with increased expeditures and margin compression in Q2 which caused the inital decline. With its high valuation it may stay weak for period of time. Growth potential is still there, and we would be reluctant to transact shares into this decline.