01—Abstract
Summary
Summary of the 10-Q filed May 5, 2026. Cited figures are marked; the original filing is the authoritative source.
Shopify Inc. reported strong revenue growth in the first quarter of 2026, with total revenues reaching $3.2 billiona, a 34% increase year-over-year.
This growth was primarily driven by a robust expansion in Merchant Solutions revenue, which grew 39% to $2.4 billionb, fueled by increased payment processing and currency conversion fees from Shopify Payments. Subscription Solutions revenue also showed healthy growth of 21% to $750 million, indicating continued demand for the core platform. While the company reported a net loss of $581 million for the quarter, this was largely influenced by significant unrealized losses on equity and other investments, amounting to $1.06 billion.
Excluding these investment-related fluctuations, the operational performance demonstrates continued expansion. The company also initiated a substantial $2 billionc share repurchase program, signaling confidence in its future and a commitment to returning value to shareholders. Shopify's Gross Merchandise Volume (GMV) surged by 35% to $100.7 billion, underscoring the growing success of its merchants and the platform's expanding reach.
02—Key points
Key Highlights
- Total revenues grew 34% year-over-year to $3.2 billion, driven by strong performance in both subscription and merchant solutions.
- Merchant Solutions revenue surged 39% to $2.4 billion, largely due to increased payment processing fees from Shopify Payments and higher GMV.
- Subscription Solutions revenue increased 21% to $750 million, reflecting continued demand for the platform and growth in MRR.
- Gross Merchandise Volume (GMV) increased 35% year-over-year to $100.7 billion, indicating merchant success and platform adoption.
- The company announced a significant $2 billion share repurchase program, demonstrating confidence and commitment to shareholder value.
- Despite a reported net loss of $581 million, a substantial portion was attributable to non-cash unrealized losses on equity and other investments.
- The company's cash position remains strong, with cash, cash equivalents, and marketable securities totaling $5.7 billion as of March 31, 2026.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q1 FY2026, Shopify Inc. lost $0.18.
- Revenue$3.17B100.0%
- Cost of revenue−$1.62B51.2%
- Gross profit$1.55B48.8%
- Operating costs−$1.16B36.7%
- Operating income$382.0M12.1%
- Interest, other & tax−$963.0M30.4%
- Net income−$581.0M18.3%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed May 5, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $3.17B$2.36B | +34.3% |
| Cost of Revenue | $1.62B$1.19B | +36.4% |
| Gross Profit | $1.55B$1.17B | +32.2% |
| R&D Expenses | $437.00M$377.00M | +15.9% |
| Operating Expenses | $1.16B$966.00M | +20.5% |
| Operating Income | $382.00M$203.00M | +88.2% |
| Net Income | -$581.00M-$682.00M | +14.8% |
| EPS (Basic) | $-0.45$-0.53 | +15.1% |
| EPS (Diluted) | $-0.45$-0.53 | +15.1% |
| Shares Outstanding (Basic) | 1.30B1.30B | +0.6% |
| Shares Outstanding (Diluted) | 1.30B1.30B | +0.6% |
05—Questions
Frequently Asked Questions
What was the main driver of Shopify's revenue growth in Q1 2026?
The primary driver of Shopify's revenue growth was the Merchant Solutions segment, which saw a 39% increase to $2.4 billion. This growth was largely due to higher payment processing and currency conversion fees from Shopify Payments, directly correlating with the significant 35% increase in Gross Merchandise Volume (GMV) facilitated through the platform.
How is Shopify addressing its net loss in the quarter?
Shopify reported a net loss of $581 million. However, this loss was significantly impacted by $1.06 billion in unrealized losses on equity and other investments, which are non-cash items and subject to market volatility. Operationally, the company is focusing on revenue growth and managing operating expenses. The company also announced a substantial share repurchase program, signaling confidence in its long-term prospects.
What is the significance of the new share repurchase program?
The company announced a $2 billion share repurchase program. This indicates management's confidence in the company's financial health and future prospects, and it represents a commitment to returning capital to shareholders by reducing the number of outstanding shares.
How is Shopify's international performance?
Geographically, North America remains Shopify's largest market, accounting for 68% of total revenues in Q1 2026. Europe contributed 21% and APAC contributed 10%. While North America continues to dominate, international segments are also showing growth, with Europe up 20% and APAC up 10% year-over-year.
06—Continue