Shopify (NYSE:SHOP) is noticing two big things: a “resilient consumer” and the “rise of entrepreneurship.”
Shopify president Harley Finkelstein has told Fox News that they’ve noticed that the “consumer remains resilient.” He claims people still buy from brands they love, including Alo Yoga, SKIMS, and BARKBOX.
But when it comes to the endurance of entrepreneurs, Shopify is noticing the “volume of entrepreneurs starting new businesses” has more than doubled in recent years.
Finkelstein told Bloomberg TV a new Shopify is shaping up. “We’re helping all different types of merchants take more and more of our products.”
In the latest quarter, Shopify generated “almost $2 billion of revenue.” That’s an increase of 23% year-on-year. “We had a billion dollars of gross profit. We had a free cash flow of $232 million for the quarter,” explains Finkelstein.
Shopify has, in fact, doubled its free cash flow compared to the same quarter last year. “So you’re seeing, I think, one of the best versions of Shopify with a ton of opportunities. We are very excited…about the future of the company,” says an optimistic president.
Shopify financial results summary
It’s precisely what analysts were expecting, and Shopify is smiling from ear to ear. The first quarter of 2024 shows revenue is up 23% year-on-year to $1.86 billion.
It has a gross margin (GAAP) of 51%, up from 47% compared to the same period last year. This helps to assess the profitability of its manufacturing activities. When it comes to free cash flow, it reported a decline of nearly half from the previous quarter.
E-commerce opportunities
As Finkelstein alluded, the e-commerce landscape has grown drastically, and more entrepreneurs are finding their way to creating wealth.
A report, Global Entrepreneurship Monitor 2023/2024, found that lower-income economies tend to have much higher proportions of new startups among different sectors. This is more noticeable in the consumer services sector, where entry requirements are “typically less demanding.”
“Fear of failure” remains the most significant obstacle to new startups, especially for women. “At least two in five adults seeing good opportunities would not start a business for fear it might fail in 35 of the 45 participating economies.”
About the author
Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand.
