Since its public debut just three years ago, Shopify (NYSE:SHOP) has been on a relentless run. Revenue has grown 425%, while the stock has soared more than 550%. The company now boasts more than 609,000 merchants worldwide, with a growing percentage of enterprise customers joining its ranks.

Fears of slowing growth took a toll on the e-commerce provider's stock last quarter, though the sell-off was short-lived. Shopify is scheduled to release its second-quarter financial report before the market opens on Tuesday, July 31. Let's look briefly at last quarter's results, and review a few metrics investors will be watching closely.

A smartphone and tablet, each with credit card readers attached, and displaying the Shopify app.

Image source: Shopify.

Still massive growth, but...

For the first quarter, Shopify reported revenue of $214.3 million, an increase of 68% year over year. While many companies would be envious of those results, it was the slowest rate of growth since Shopify went public in mid-2015. 

The company continued to pour all its profits back into its worldwide expansion, producing an operating loss of $20.3 million, worse than the $14.5 million loss in the prior-year quarter, and generating a loss per share of $0.16, a 7% decline versus the year-ago period.

For the second quarter, Shopify said it anticipates revenue in a range of $230 million to $235 million, which would produce year-over-year growth of between 52% and 55%. This would be a significant deceleration from the 68% year-over-year growth the company saw just last quarter. The company is also guiding for an adjusted operating loss in a range of $5 million to $7 million, which works out to an adjusted loss per share of between $0.05 and $0.07.

While long-term investors shouldn't concern themselves with Wall Street's short-term thinking, estimates can help provide context. Analysts' consensus estimates are calling for revenue of $234.64 million -- at the high end of management's forecast -- and a loss per share of $0.03, better than what Shopify is predicting. 

Shopify has a history of providing conservative guidance, and I suspect this quarter will be no different.

Other metrics to watch

Another key metric for investors is Shopify's monthly recurring revenue (MRR), found within the company's subscriptions segment. Because its business is subscription-based, recurring revenue can be a key factor for Shopify's success. The ability to consistently grow this predictable income stream eliminates some of the inevitable ebbs and flows and seasonality found in many businesses.

In the first quarter, MRR grew to $32.5 million, up 57% compared to the prior-year quarter. Shopify Plus, the company's enterprise solution, is becoming an increasingly important part of the company's growth potential; it accounted for $7.0 million, or 22% of total MRR, up from 17% in the year-ago period.

The volatility will likely continue

The company's market cap of just $18 billion and its sky-high valuation both contribute to the excessive volatility experienced by Shopify investors -- and that's likely to continue. The company is not yet profitable on a GAAP basis, so using the price-to-earnings ratio is out, but using the price-to-sales (P/S) ratio serves as a viable substitute. Shopify currently sports a trailing P/S of 23, and a forward valuation of 18, both significantly higher than market averages.

While a valuation of this magnitude is a normal part of being a small, high-growth company, it also means that if the company's results fail to live up to the market's lofty expectations, the stock price could plummet -- as we've seen happen on numerous occasions.

The runway for Shopify's e-commerce platform is massive, and over the longer term, I expect the company to continue to excel. However, investors should brace themselves for the roller-coaster ride to come.