Shopify (SHOP -0.47%) continues to increase the tools it provides to its merchants, and during the earnings call, it announced the acquisition of Deliverr, which will expand its logistics solutions. Today's video focuses on Shopify's earnings report that caused the stock price to tumble over 13%. Here are some highlights.
- Shopify had another growth quarter. Unfortunately, it did not meet analyst expectations in revenue or earnings. Revenue grew 22% year over year (YoY), one of the slowest quarters this company has seen. Management believes that numerous headwinds affected revenue growth, like macro impacts, high inflation, the absence of stimulus checks, and the easing of lockdown restrictions.
- Shopify is acquiring Deliverr, a fulfillment technology provider. With the acquisition, Shopify will be able to streamline logistics for merchants of all levels. The deal is valued at $2.1 billion, approximately 80% in cash and 20% in shares. I look at Shopify's balance sheet in the video and discuss how this increases its competitive advantage against Amazon (AMZN 2.49%).
- With the addition of Deliverr, Shopify announced Shop Promise, a new service that will allow merchants to provide two-day and next-day delivery options. Other tools like Shopify Payment and Shopify Capital have also seen growth YoY.
*Stock prices used were the market prices of May 5, 2022. The video was published in May 5, 2022.