10-K/APeriod: FY2025

SHOPIFY INC. Annual Report (Amendment), Year Ended Dec 31, 2025

Filed April 29, 2026For Securities:SHOP

Summary

This 10-K filing for Shopify Inc. for the fiscal year ending December 31, 2025, primarily details the company's corporate governance, executive compensation, and security ownership. Key highlights include a strong revenue growth of 30% to $11.5 billion, with merchants generating $378 billion in gross merchandise volume. The company also achieved a free cash flow of $2 billion, marking a 17% free cash flow margin, indicating a focus on profitable growth. The executive compensation strategy emphasizes long-term alignment with shareholders through equity-based incentives, specifically using a 'boxcar' equity grant model with extended cliff vesting. The company's board of directors is composed of a majority of independent members, bringing diverse expertise from technology, finance, and business leadership. Security ownership remains heavily concentrated with founder Tobias Lütke, who maintains significant voting control through a dual-class share structure and a founder share.

Financial Highlights

48 data points
Beta

Revenue

$11.56B

48.1% Gross Margin

Net Income

$1.23B

10.7% Net Margin

EPS (Diluted)

$0.94

Total Assets

$15.19B

Cash & Equivalents

$1.54B

Free Cash Flow

$2.01B

Financial Statements
Beta
Revenue$11.56B
Cost of Revenue$6.00B
Gross Profit$5.55B
R&D Expenses$1.54B
Operating Expenses$4.09B
Operating Income$1.47B
Net Income$1.23B
EPS (Basic)$0.95
EPS (Diluted)$0.94
Shares Outstanding (Basic)1.30B
Shares Outstanding (Diluted)1.30B

Key Highlights

  • 1Shopify Inc. reported a 30% revenue increase in 2025, reaching $11.5 billion, with merchant Gross Merchandise Volume (GMV) growing by 29% to $378 billion.
  • 2The company achieved a free cash flow of $2 billion in 2025, with a free cash flow margin of 17%, demonstrating strong profitable growth.
  • 3Executive compensation is heavily weighted towards long-term equity incentives, utilizing a 'boxcar' equity grant model with extended cliff vesting to align executive and shareholder interests.
  • 4The Board of Directors is composed of a majority of independent directors, bringing a wealth of experience in technology, finance, and business leadership.
  • 5Founder and CEO Tobias Lütke maintains significant voting control through a dual-class share structure and a founder share, holding approximately 40.02% of the aggregate voting power.
  • 6The company continues to invest in emerging technologies, including AI-enabled features, to empower merchants and enhance their selling and buying experiences.
  • 7Shopify operates with a remote-first work environment, fostering a culture that values merchant obsession and adaptability.

Frequently Asked Questions

Shopify's executive compensation philosophy is centered on a long-term approach designed to align executive interests with those of shareholders. The majority of executive compensation is delivered through equity-based incentives, such as stock options and RSUs, with a 'boxcar' grant model and extended cliff vesting. This structure aims to motivate sustained performance, promote retention of key talent, and ensure that realized compensation is a function of Shopify's multi-year performance.

Tobias Lütke, the company's co-founder, CEO, and Chair of the Board, holds significant voting control. Through a combination of Class B restricted voting shares, Class A subordinate voting shares, and the Founder Share, Mr. Lütke and his affiliates control approximately 40.02% of the aggregate voting power of all outstanding voting shares as of April 21, 2026.

Shopify's Board of Directors is committed to independence, with a majority of its members meeting the criteria for independence as defined by Nasdaq listing standards and applicable Canadian securities laws. The Nominating and Corporate Governance Committee plays a key role in identifying and assessing director candidates. Independence is determined based on each director's background, employment, and affiliations, ensuring that their judgment is not compromised in fulfilling their responsibilities.

The 'boxcar' equity grant model is a long-term incentive structure where equity awards, such as stock options and RSUs, are granted with extended cliff vesting periods (typically two to four years). This means executives do not begin to receive value until after this initial cliff period has passed and their initial equity awards have fully vested. Shopify uses this model to provide a clearer and more predictable equity distribution over time, strongly aligning executives' financial outcomes with the company's long-term performance and sustained execution, rather than short-term metrics.