Shopify Inc. (NYSE:SHOP) Q1 2024 Earnings Call Transcript May 8, 2024

Shopify Inc. beats earnings expectations. Reported EPS is $0.2026, expectations were $0.1717. Shopify Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Carrie Gillard: Good morning, and thank you for joining Shopify's First Quarter 2024 Conference Call. Harley Finkelstein, Shopify's President, and Jeff Hoffmeister, our CFO, are with us today. After their prepared remarks, we will open it up for your questions. We will make forward-looking statements on our call today that are based on assumptions and, therefore, subject to risks and uncertainties that could cause actual results to differ materially from those projected. We undertake no obligation to update these statements, except as required by law. You can read about these assumptions, risks and uncertainties in our press release this morning as well as in our filings with the US and Canadian regulators. We'll also speak to adjusted financial measures, which are non-GAAP and not a substitute for GAAP financial measures.

Reconciliations between the two are in the tables at the end of our press release. And finally, we report in US dollars. So, all amounts discussed today are in US dollars unless otherwise indicated. With that, I'll turn the call over to Harley.

Harley Finkelstein: Thanks, Carrie, and good morning, everyone. The start of 2024 has been very strong for Shopify with more and more merchants thriving on our platform. This is the strongest version of Shopify yet. We're helping millions of merchants around the world to both start and scale their businesses. For four straight quarters, we have demonstrated our ability to drive results at scale, growing revenue over 25%, excluding logistics. And as we have proven over the last two decades, the more hard problems we solve for merchants, the more we add to our flywheel and the better off commerce is for everyone today, tomorrow and for many years to come. We've talked a lot about this new shape of Shopify and how it's enabling us to drive greater growth and profitability at a larger scale, and it's working.

The penetration of payments is on the rise. We're making significant strides in our offline and enterprise sectors. Our efforts towards international growth are yielding positive results, and our attach rate is expanding. Our operating discipline has been a key factor in the success, ensuring that we maintain efficiency, invest from our position of strength and deliver value at every turn. Shopify has always been high volume, high velocity when it comes to building and shipping products. In the span of just two years, we've rolled out more than 400 new features and updates to our platform, setting a pace that demonstrates our leadership in building for the future. In that time, we've launched what we call editions twice a year, changing how we present and unveil Shopify's progress.

These biannual moments have not only increased engagement, product adoption and visibility with our merchants and partners, but also reinforced our leadership in commerce. In fact, in our recent Q1 edition, 62% of businesses who installed Shopify subscriptions had never previously installed a subscription app on Shopify, demonstrating the impact these key storytelling moments can have on driving adoption. We're dedicated to continually creating great software that allows brands to start and scale, finding their desired features quickly and intuitively as if each feature had been integrated from the start. From foundational elements like expansion of variant limits to 2,000 and the rollout of our web performance dashboard, which can improve a storage search rankings and boost conversion to new AI enabled editing tools and within point of sale, the launch of e-mail capture at off-line checkout, we are relentlessly working to reduce friction and make it easier for merchants to run and manage their business.

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