On November 12, Shopify (SHOP) is expected to release its third-quarter 2024 financial results. Shopify anticipates revenue growth for the quarter that will be reported to be between low and mid-20% on an annual basis.
Shopify Merchant Growth Looks Solid
Strong merchant base growth is helping Shopify, and third-quarter numbers will show this trend. In spite of a difficult economic climate, merchant-friendly products including Shopify Payments, Shopify Collective, Shop Pay, Shopify Audiences, Shop Cash, and Shopify Capital offerings are assisting it in attracting new merchants. Many small and medium-sized enterprises that are impacted by ongoing inflation use Shopify's platform.
Shopify now supports UPS and controlled markets, allowing retailers to provide international consumers with cheap accelerated shipping prices. Both established, big companies and new, smaller businesses have been drawn to the platform by its continual attempts to streamline procedures.
The business has been making investments to provide the most modern solutions for e-commerce. products such as the Marketplace Connect app, Collective, Tax Platform, Shop Pay, and Bill Pay.
Shopify Key Metrics Analysis
It is anticipated that merchant expansion contributed to the growth of Gross Merchandise Volume during the quarter that will be reported. Shop Pay accounted for 39% of SHOP's GPV in the subsequent quarter of 2024, processing $16 billion in GMV. GPV increased to $41.1 billion in the second phase, accounting for 61% of the GMV generated.
The 27% over the past year growth in offline GMV indicates that larger international merchants with various locations are increasingly using SHOP's services. The second quarter saw the online and offline debut of international companies EVEREVE and MAJOURI in collaboration with Shopify, which span more than 130 sites across four regions. This was a significant accomplishment for the business.
Shopify's Strength In Business Expansion
One significant move is Shopify's plan to concentrate on its main business by selling off its logistics division. Shopify businesses may now access Amazon's extensive fulfillment network thanks to their relationship. Additionally, the partnership with Target enhances SHOP's reach.
Shopify merchants of all sizes can now effortlessly handle and automate worldwide tax compliance thanks to their collaboration with Avalara. The partnership with Manhattan enables it to provide customers with top-notch, cohesive omnichannel purchasing experiences.
Shopify's growing global presence is impressive. It introduced the point-of-sale move and point-of-sale station in Australia during the first quarter. It is revolutionary that the Markets Pro is now available in foreign markets. Cross-border revenues accounted for 14% of SHOP's GMV in the second quarter of 2024.
Shopify Stock Forecast Technical Analysis
In the daily chart of SHOP stock price, the current price is trading within a strong bullish trend after exhausting the May 2024 low.
In the main chart, a strong bullish crossover is seen between the 50-day EMA and 200-day SMA lines. It is a sign of a strong bullish continuation signal from the Golden Cross, where the 50-day EMA is working as an immediate support level.
A similar structure is visible from the volume's side, where the largest volume in 6 months is found at the 65.60 level.
Based on the current market outlook, any upbeat earnings report could boost the buying pressure in this stock, taking the Shopify stock price above the February 2024 high. Moreover, the bullish momentum is valid as long as the 50-day EMA is below the current price. A break below the 72.00 level could invalidate the buying possibility at any time.
In that case, investors might find a bearish opportunity, aiming for the 65.00 to 60.00 zone.
